Germany Corporate Payment Survey 2022: Battered companies prepare for another crisis
The sixth edition of Coface's survey on corporate payment experience in Germany was conducted in July and August 2022, with 1070 companies participating. This is the third edition taking place in the context of the COVID-19 pandemic, but the first to take into account the impact of the war in Ukraine and its effect on trade. One of the main takeaways of this year’s survey is that payment behaviour has become slightly more restrictive: with a gas-crisis on the horizon, fewer companies are offering payment terms (71%) compared to last year (74%). Businesses remain cautious, and prefer to cash-in as soon as possible. Accordingly, the preference for shorter credit-terms remained unchanged: more than half of the surveyed companies requested payments be made within 30 days, while ultra-long credit terms (120+ days) remained rare.
Although two and a half years of a difficult and complex economic situation are taking their toll, the cost appears to be comparatively lower: the number and duration of payment delays has increased, but only on a small scale, and starting from a very low level. Even though payment discipline in 2022 deteriorated compared to 2021, and 65% of surveyed companies reported payment delays (+6pp year-on-year), this is still below the level we saw in 2020, and far below pre-pandemic levels (82% on average). The average duration of payment delays increased to 28.7 days in 2022 (+1 day YOY), after shortening by seven days YOY in 2021. Most sectors (excluding paper-packing, agri-food, machinery and automotive) reported an increase in the duration of payment delays. With an average of 18.4 days, companies in the paper-packing sector experienced the shortest waiting-time this year, while companies in the finance sector were the most patient, with an average delay of 35.0 days (still below 2021's peak of 35.8 days in the machinery sector).
Although the payment behaviour remains very positive, companies have never been so pessimistic about their business outlook. While the view on the current situation this year is more or less neutral - 23% of participants think their business situation is better than in 2021; 22% see it as worse - the view for 2023 is very clear. 38% of companies surveyed are pessimistic regarding 2023, while only 14% are optimistic about their near future. The main reason for this is the significant amount of risks that companies are facing. Pre-existing risks, such as global production chain disruptions and rising non-energy commodity costs, remain the key concern for companies export outlook in 2022. However, new risks - including the war in Ukraine and related sanctions as well as rising energy prices - are also weighing on companies' minds. COVID-19 is currently a minor issue, although businesses are well aware of the economic risk of any new mutations. Related to these risks, international market focus has shifted. German companies are focused less on the European Union and the United Kingdom, and more on non-EU countries, possibly to circumvent sanctions against Russia. In addition, China has lost some of its popularity, while the United States are once again a key export destination. With all these obstacles on the horizon, the question remains: how did German companies navigate the economic crisis caused by the pandemic, and in what shape are they entering the looming gas-crisis? While 48% of participants had used public support over the last 12 months in 2021, this number was still 30% in 2022, with 25% even using state aid in the last 3 months before public support ended in June 2022. It is unclear if these companies will be able to continue without the support measures, which is especially true for companies using state-backed loans (31% of the participants who use support measures), as the loans require the start of repayments two years after their admissions.
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 The survey was conducted between 27 June and 14 August 2022.
 Coface is publishing Germany corporate payment surveys since 2016.