More than 500k overdue invoices in the North East in Q1, R3 research shows

R3’s analysis of data provided by Creditsafe shows there were 522,566 overdue invoices on the books of North East businesses in Q1 2025 - with 173,197 in January, 175,020 in February, and 174,349 in March. This is a rise of 21.2% compared to Q1 2024’s total of 431,039.

Looking at the wider UK picture, the North East saw the third largest percentage increase in overdue invoice numbers, preceded only by the West Midlands (46.3% rise) and Scotland (41.4%).

Kelly Jordan, Chair of R3 in the North East, says: “Late payment levels in the North East have remained consistently high since October last year, and the surge this quarter compared to last year is a stark reminder of how financial pressures are escalating for local businesses.

“Cost increases that came into effect at the start of this month, including rises to Employers’ National Insurance and the minimum wage have been a major concern for businesses over recent months. Now that they’re here, there’s a real risk they could push more firms into cash flow difficulties, particularly in sectors already running on tight margins like construction, hospitality and retail.”

The total number of North East companies with overdue invoices on their books also rose by 6.7% in Q1 2025 when compared to the same period last year, rising from 36,498 to 38,934.

Kelly, who is a partner at Muckle LLP, continues: “It’s concerning to see not just that overdue invoice numbers are rising, but more businesses are finding themselves with overdue invoices on their books. When more companies are struggling to pay their bills on time, it has a knock-on effect across supply chains and makes it harder for others to stay on top of their own finances.

“April could be a turning point for many businesses, and it’s crucial that directors know how to spot the early signs of financial distress. If you’re noticing problems like rising late or missed payments, falling margins, or mounting pressure from creditors, then it’s likely time to speak to a professional. Seeking advice as soon as these issues arise can provide clarity, more time to address the situation, and potentially more options for resolving your concerns.”