Companies in North America (USMCA) are ramping up their credit management efforts in response to a surge in delayed payments.
The 2023 Payment Practices Barometer survey for North America (USMCA) was conducted between the end of Q2 and the beginning of Q3 2023. Its findings should therefore be viewed with this in mind.
Key takeaways from the report for North America (USMCA)
USMCA companies intensify credit management as late payments soar
- A deterioration of B2B customer payment behaviour was evident in a 13% rise in late payments during the past year. Just over 50% of all invoiced sales were affected by payment delays. Bad debts were relatively stable across the region, standing at 7% of all B2B invoiced sales.
- The main reason for late payments in the USMCA region was invoice disputes, although liquidity shortfalls among B2B customers was a key factor for US companies. Insolvencies were an issue in Mexico. On average, 66% of businesses collected overdue payments more than one month beyond the due date.
Rising mood of optimism despite inflation and cashflow worries
- A wide range of concerns were expressed by USMCA companies, with inflation and uncertainty surrounding energy and commodity prices a key preoccupation for the year ahead. Interest rate fluctuations and the effect on borrowing costs are a further concern for the coming months, while cash flow issues and liquidity shortfalls are another particular anxiety as companies in the region navigate challenges caused by soaring customer credit risk.
- Despite these worries, a sense of optimism for the future was found in our survey. 75% of companies polled, especially in the US, anticipate a surge in demand for products and services. However, the perspective on profit margins diverges, with a lower 60% of businesses anticipating an increase, with the US showing the highest level of positivity.
The Atradius Payment Practices Barometer is an annual survey of business-to-business (B2B) payment practices in markets across the world. Its findings can give valuable insights into the current dynamics of corporate payment behaviour in B2B trade. It can also help companies doing business, or planning to do so, in the markets polled to identify emerging future trends in the payment practices of B2B customers.
Interested in finding out more?
For a complete overview of the 2023 survey results for North America (USMCA), please download the reports available in the related documents section below. The Statistical Appendix to the regional report is also available for download in the section below.
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