Almost 1 in 5 invoices issued by small and medium-sized businesses in the UK are paid late, according to research.
On behalf of Sage, Plum Consulting analysed a survey of over 3,000 companies, across 11 countries.
Of the countries surveyed, UK companies were shown to have one of the highest rates of late payment, totalling £112 billion per year.
This was found to have significant impacts on productivity, with an average of 15 days spent chasing payments.
Over half of those surveyed in the UK said this causes negative effects for their business, impacting on their ability to pay suppliers (26%), invest (25%), and give employees an annual bonus (22%).
The report called for a change in the business culture that sees late payments as acceptable, and increased awareness of the impacts they can have.
Use of automation was also encouraged, as a way of chasing payments without putting the client relationship under strain.
Stephen Kelly, chief executive of Sage, said:
"At a time when economies around the world are rightly obsessed with driving up productivity, we must work to help small businesses cut down hours spent on administrative tasks like this, allowing them to spend more time growing their businesses."
Get in touch for help managing your cashflow.