Businesses in the UK lose up to £20 billion per year because of poor payment practice, according to new research from the payments group Prompt Payer.
And approximately one quarter of UK businesses that go insolvent do so because invoices are paid late, statistics from the Federation of Small Business show.
Though the Late Payments Act was instituted in 1998, since then businesses take an average of eight days more to pay invoices, figures from the credit rating company Experian prove.
Mark Flower, managing director of Prompt Payer, said: "Late payment affects every company large and small, harming reputation and damaging business relationships.
"Survey results highlight the need to place late payment higher on the agenda, encouraging companies to take an active stand against the issue and put an end to late payment once and for all."
Responsibility must be taken by companies themselves and certain measures must be taken to protect their business, such as familiarisation with government legislation, added Mr Flower.
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