Slow payments can have a significant impact on a business's operations:
Cash Flow Problems: Delayed payments can lead to a shortage of working capital, affecting daily operations. Increased Borrowing: Businesses may need to take out loans to cover shortfalls, leading to increased interest expenses. Strained Supplier Relationships: Delays in receiving payments can hinder a company's ability to pay its own suppliers on time. Opportunity Cost: Funds tied up in unpaid invoices could have been used for other investment opportunities.