The Payment Discipline of Small and Medium-sized Enterprises

Abstract

The issue of payment discipline is strongly interconnected with the competitiveness of companies. The aim of this article is to examine the opinions of entrepreneurs from SMEs in Slovakia on the payment discipline issue and its consequences, including the risk of insolvency and lowered competitiveness, and to compare the results in terms of the defined social groups. The entrepreneurs were divided into monitored groups according to the following criteria: gender, age (groups: younger than 35, 36 to 45 years old, and older than 45) and level of education (groups: university educated, other level of education). This article is based on the research conducted in the Slovak business environment in 2016. The results showed that payment discipline represents a major problem in SMEs in Slovakia, a fact confirmed by affirmative replies from more than 67% of the entrepreneurs. While 83% of them noted the existence of problems with overdue receivables, 30% of the respondents acknowledged problems with their own payment discipline and identified secondary insolvency as the most important reason for it.

Keywords

• financial risk
• payment discipline
• overdue claims
• small and medium-sized enterprises
• Slovakia