German companies have switched to “crisis-mode” and offer less payment terms
German companies want to cash in as early as possible, according to the fourth edition of Coface’s survey on corporate payment experience in Germany, conducted in July and early-August 2020, with 753 participating companies located in Germany.
Unsurprisingly, COVID-19 and its effects on the global and German economy is the predominant topic of this survey. One major finding is that German companies are getting worried: companies became cautious in providing payment terms to their clients and less companies are offering payment terms overall and these have shortened, even drastically in some sectors.
The main risks for the export-business have changed a lot. Last year’s number-one risk, the U.S.-China trade conflict, is only marginal within the risk spectrum of 2020. Instead, 3 out of 4 companies named COVID-19 and its effects on the global or the German economy as the main risk, alongside the disruption of production chains because of the pandemic. Nevertheless, risks like the Brexit - which is present since our 2017 survey - have not vanished and could become even more urgent with a “No-Deal-Brexit” looming for 2021. Thus, even with a slightly brighter outlook for 2021, Germany is far from exiting the “crisis-mode”.
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