B2B payment practices trends, Hong Kong 2024

B2B customer cashflow problems spark concern over late payments

While 63% of companies in Hong Kong report stable payment behaviour from their B2B customers, delays in payment remain a problem for many businesses across our survey. Steady payment practices are particularly evident in the electronics/ICT sector, but some consumer durables companies tell us they had to wait longer than last year to collect payments. Overall, an average 52% of sales being made on credit to B2B customers in Hong Kong are not currently paid by the due date. Bad debts written off as uncollectable stand at an average 4% of all B2B invoices, prompting significant financial strain for businesses. The major reason for late payments, cited by 40% of Hong Kong companies, is cash flow troubles among B2B customers, causing concern that difficulties faced by one firm could spread more broadly through an industry.

Widespread optimism despite geopolitical and economic worries

A positive mood about the outlook for the year ahead is clear in our survey of Hong Kong companies. 48% of businesses tell us they anticipate an improvement in B2B customer
payment behaviour during the year ahead, especially in the electronics/ICT sector. Many companies in the textile-clothing industry foresee no significant change in payment practices,
while only a minority expect a deterioration. The logical consequence of this is that 41% of businesses in Hong Kong also expect improvement in Days Sales Outstanding (DSO)
during the coming months, against notably in the electronics/ICT industry. A possible worsening of DSO is anticipated only by a minority in the consumer durables
sector. There is also optimism about the prospects for insolvency rates among companies in Hong Kong, with 64% anticipating that these will remain unchanged in the year ahead. Our survey also finds that companies in Hong Kong have a variety of concerns looking ahead despite the generally optimistic environment. One major worry is about how shifting domestic and global economic conditions could impact on their businesses, notably a reduction in consumer spending and demand.

The Atradius Payment Practices Barometer is an annual survey of business-to-business (B2B) payment practices in markets across the world. Its findings can give valuable insights into the current dynamics of corporate payment behaviour in B2B trade. It can also help companies doing business, or planning to do so, in the markets polled to identify emerging future trends in the payment practices of B2B customers. 

Interested in finding out more?

For a complete overview of the 2024 survey results for Hong Kong, please download the full reports available in the related documents section below.