Over half of Irish exporters had customers who did not pay them over the last year, according to a survey released yesterday, writes Barry O'Halloran

The Irish Exporters' Association (IEA) Export Ireland Survey 2004 shows that Irish companies selling goods and services overseas are spending a growing proportion of their time on credit management.

The report states that 43.5 per cent of those surveyed agreed that customers taking longer to pay than in the past, while just 24.1 per cent disagreed.

It states that 51.6 per cent of the businesses involved reported having to deal with bad debts during the past year, a figure it describes as "surprisingly high". At the same time, 15.3 per cent reported that their overseas customers delayed payments.

The situation is putting pressure on exporters' cash flow, and almost three quarters of those surveyed stressed that managing this was central to sustaining commercial success.

However, it also points out that Irish exporters are happy to offer generous credit terms, with 58 per cent of them giving customers 60 days in which to pay.

Launching the document, IEA president, Mr Michael Counahan, warned that extended credit was stretching companies' resources.

"The survey clearly establishes that the great majority of exporters depend on cash flow and overdrafts to fund this credit," he said. "This both increases the level of risk involved and the ability of exporters to expand their business."

Despite the problems that they encounter with payment, the report shows that Irish exporters are unwilling to take out credit insurance.

Only 28.3 per cent of those questioned took out this insurance, with 40 per cent of those seeking cover against bad debts.

The IEA report also expresses concern about the fact that 10.1 per cent of exporters said they made no attempt to manage their foreign currency risks, even though they are dealing with customers outside the euro area. The balance of those surveyed, 89.9 per cent, do take this precaution.