Australian small business owners are collectively owed $26 billion in unpaid invoices at any one time, averaging $13,200 each, according to new research from Intuit Australia and PayPal Australia.
The research found small business owners are spending an average of 12 days a year chasing unpaid invoices, yet less than one third offer electronic payment options which would speed up payments and improve cash flow.
Nicolette Maury, Country Manager and Managing Director, Intuit Australia said small businesses need to take another look at how they manage payments with one in five admitting they can't afford any outstanding debt before they cease trading.
“Australians are generally considered to be laid back, humble people, but when it comes to business management and cash flow, our research shows business owners need to take charge and bring cash back into their business more quickly,” she said.
QuickBooks Online now offers online invoice payments with strategic PayPal partnership
Through online invoice payment integration with QuickBooks Online and PayPal, small businesses can now offer their customers more payment options. Emma Hunt, Director of Small Business, PayPal Australia says the new integrated ‘Pay Now’ functionality included in invoices created within QuickBooks Online, allows customers to pay using PayPal, credit or debit cards, with just a few clicks.
“Working with over 110,000 merchants in Australia, we understand that cash flow can present a challenge for growing Australian businesses. We are committed to helping Australian entrepreneurs get paid faster and more seamlessly – by offering their customers convenience and choice. Australian small business owners should have confidence that they can easily access the technology and resources to best manage their payments,” Ms Hunt said.
The integration also solves another key challenge for small businesses – saving time and eliminating manual data entry with PayPal sales transactions, fees, discounts and taxes seamlessly synced with QuickBooks Online.
“We’re working to help solve the challenges small business owners face day-in-day-out. Integrating QuickBooks Online with PayPal helps Australian small businesses get paid faster. What I’m most excited about though, is that the detailed breakdown of PayPal transactions offered in QuickBooks Online through this integration is a first for customers in this market,” Ms Maury said.
Huge opportunity for business owners to solve the late payments challenge
According to the research, just 12 per cent of small businesses request upfront payment with two thirds (67%) taking up to a week to issue an invoice and one in 10 invoicing more than a week after work has been completed.
Calculated based on extrapolation of the research to reflect the 2 million small businesses in Australia (ABS)
“Despite most small business owners being willing to pay for services on completion when dealing with other small businesses, very few are asking for the same courtesy from their own customers and it’s costing them dearly,” Ms Maury said.
Key findings from the research
- 27 per cent of small businesses have been forced to take on loans or credit to pay suppliers and wages
- Almost a quarter (24%) of small businesses that don’t insist on upfront payments are waiting over a month to be paid for their services
- More than 70 per cent of those that don’t invoice upfront say they would embrace new methods to help bring money into the business faster
- Around one in three small businesses that don’t insist on upfront payments (29%) say reducing the time taken to get paid will enable them to run the business more effectively
For more information on how to integrate QuickBooks Online with PayPal, please visit http://www.intuit.com.au/payments?cid=ipr_Intuit_PayPal_PR_paypalfulllaunch_700023.
For more information on tackling business challenges like cash flow, visit our Small Business Centre: intuit.com.au/smallbusinesscentre