The average payment period in Portugal is 74 days, according to the "Payment Behaviour 2018" study by Euler Hermes, placing the country at the bottom of the table, far from the 40-43 days of New Zealand or the 45-47 days of Denmark. According to the study, the global average payment period in 2017 was 66 days, and it is estimated that it increased to 67 days in 2018. Portugal, along with Spain, Greece, and the Netherlands, is one of the European countries where the average payment period has increased the most.
According to the study, in Portugal, one in four private companies receives payment after 120 days; however, the average payment period varies depending on the different sectors of activity. Thus, the average payment period for Portuguese companies in the retail sector is 17 days, followed by companies in the paper industry sector (46 days) and companies in the utilities sector (48 days). On the opposite side, the sectors with the longest payment periods are technology and transport, with an average payment period of 99 days.
According to SERES, there are three main conditions that delay invoice payments. The first is that the invoice does not reach its destination. The second is the existence of discrepancies or errors in the invoice. The third is that the company responsible for making the payment does not want to or cannot pay on time.
Almost 50% of delays occur within the scope of the first two assumptions, which arise in the period between the issuance and payment of the invoice and should be avoided at this stage. This is a period of time in which the provider is usually unaware of the status of the issued invoice.
The main objective of any invoice is to be paid. If companies pay before the due date, their activity and growth will be faster. Electronic invoicing is a key element in reducing payment times for companies, since the automation and traceability it offers considerably streamlines all processes.
“ Automation ,” explains Alberto Redondo, marketing director for SERES in the Iberian Peninsula and Latin America, “ makes processes involving repetitive tasks more efficient, tasks that, despite everything, must be very precise: invoicing, accounting, accounts receivable, and other financial processes. The SERES solution unifies all the services and tools necessary to outsource the exchange, monitoring, and advance payment of invoices, progressively transforming, at the pace of each business and its commercial partners, the work of sending paper invoices electronically .”
To reduce the average payment period, SERES offers the possibility of financing invoices, allowing for early payment so that companies can cover their operating costs immediately and improve their liquidity levels. An electronic invoicing service provider has precise knowledge of the status of each invoice, which enables this financing. In addition to the financial advantages, the service stands out for its speed.
Paying invoices in advance is a much more flexible and transparent option. The right to collect on a single invoice is granted when needed and at a fixed price.
Thanks to the added value that electronic invoicing provides to invoice advances, by reducing management times, financing options are facilitated and simplified, and financing periods are extended. As such, cost savings are achieved. Finally, it is worth highlighting that electronic invoicing offers integration and automation between the supply chain and the financial network.
SERES' invoice advance and financing service, together with the Track2Pay service for invoice monitoring and proactive, automated management before due dates, allows companies to transform and improve their finance departments at every stage: administrative and invoice preparation/receipt, control and monitoring, approval, accounting, tax reporting, collection process, and treasury.
The universal adoption of electronic invoicing has brought transparency and speed to commercial relationships: invoices are issued and accepted immediately, thus reducing payment times. Furthermore, there is greater control for both parties, since electronic invoicing offers traceability that paper invoices do not. Therefore, electronic invoicing is a major ally in streamlining payment processes within companies.
