New Germany Corporate Payment Survey 2016

Despite the solidity of Germany’s economy, payment delays are still commonplace

• 84% of German companies experience delays in payments, with export companies the most affected
• On a cross-sector average, payment delays correspond to 41.4 days
• For over 3/4 of German companies, the maximum delay is 60 days - lower than in China
• 84.4% of companies grant credit periods. While 20% report reduced outstanding receivables, 16.9% have seen a rise
• Mixed picture across business sectors. Textiles/Leather/Clothing is the most severely affected, at 94.4%

Coface’s first German payment survey, conducted among over 850 participant companies, reveals that, despite the country’s solid economic situation, nearly 84% of companies are affected by delays in their customers’payments. Nevertheless, the positive situation of German companies is reflected in the fact that they have seen a slight reduction in the financial volumes of outstanding receivables over the past year. Payment delays, for the companies surveyed, remain within manageable time periods. Potential liquidity risks, arising from very long overdue receivables, are thus relatively low.

Payment delays: German companies in better situation than their Chinese counterparts

Payment delays are a regular occurrence for 83.7% of companies. Over half of these delays are due to financial difficulties experienced by customers. This is higher than the share reported in China, according to a recent Coface survey. Around 80% of Chinese companies are experiencing payment delays, while in the Asia Pacific region, the proportion is even lower, at just 70%. In Germany, payment delays are more frequent for companies that are mainly dependent on exports, at nearly 90%, while companies trading on the German domestic market report 82.8%. Compared with the previous year, the size of outstanding receivables shows a downward trend. Around 20% of the companies surveyed report reduced outstanding receivables, while 16.9% have seen a rise. For over 60%, the level of outstanding receivables remains unchanged.