Transformation is on the agenda in Central Europe
While businesses across Europe are deferring long term investment in favour of cost cutting, Central European businesses are more likely to be prioritising digital transformation than other regions, according to Intrum’s European Payment Report 2023.
An overview of the European Payment Report (EPR) results for Central Europe, including: Austria, Belgium, France, Germany, Hungary, Ireland, the Netherlands, Switzerland and the United Kingdom.
Digital drive to increase efficiency
The latest annual report surveyed more than 10,000 businesses across 29 countries and found that 70 per cent of Central European businesses see digital transformation as a strategic priority, compared with 64 per cent in Northern Europe. In the UK, 77 per cent of businesses agreed, followed by 74 per cent in the Netherlands, 71 per cent in Switzerland and 70 per cent in Germany and Hungary.
This drive for digital transformation may come from the anticipated impact on payments. More than half (55 per cent) of the companies in the region anticipate that administrative efficiency will make it harder for customers to pay their invoices on time, the highest across all regions. Businesses ranked this challenge alongside the impact of rising interest rates, supply chain disruption and regulation in terms of significance.
It may be that Central European companies have become more aware of the impact that outdated technologies have on efficiency. And the impact goes further. As well as creating savings for the business, customers increasingly expect digital channels and fast access to services when making purchases. Investing in digital solutions is wise.
Ethical codes and payment behaviour
Another positive trend within the region is that its businesses are the most likely, across Europe, to have a code of ethics in place to encourage prompt payments. This factor corresponds with more reliable payments on the part of customers. The average time for corporate customers to make payments in the region is 56 days and in Ireland the figure is notably low, at 46 days.
This spirit of responsibility is also reflected in Intrum’s finding that Central European countries are more likely to think about the negative impact that late payments have on smaller businesses than the European average. More than half (52 per cent) said they did think about this impact, compared with 48 per cent across Europe. Meanwhile, two thirds (66 per cent) agreed that large businesses have a responsibility to society to ensure they pay smaller companies on time.
This is positive, however, there is still room for businesses to fully think through and understand the obligation they have to smaller suppliers when it comes to payments. In practice, Central European countries are most likely to say they pay their suppliers later than they would ever accept themselves.
Insights from the EPR Country Snapshots 2023
Access the full white paper today for a full overview of the local results.
