Claims for late or unpaid invoices have shot up by 50% in the food & beverage sector, according to one of the UK’s largest trade credit insurers.
Data from insurer Atradius showed a 50% month-on-month spike in claims in March, the first full month since the start of the Iran war. There were double the number of claims in the UK in March 2026 than there were in March 2025.
“The Iran war has sent a massive ripple through the food and drink supply chain, at a time when the UK is already vulnerable to rising freight, fuel and energy costs – piling the pressure on to firms that are already operating on thin margins,” said Atradius senior underwriter James Napier.
The UK food and drink industry is also heavily reliant on imports, which makes it exposed to global disruption – including the rising fuel costs, shipping delays and unexpected surcharges many businesses were exposed to in March.
When in doubt about the wider economy, many businesses simply “delay payment, delay orders and put on hold growth plans,” said Ian Carrotte, leader of business credit group ICSM, which helps members identify late payers and avoid bad debts. ICSM has also seen a spike in late payments for members, and an increase in bad debts.
Delayed payment spreads business distress wider, piling pressure on to smaller suppliers less able to manage fluctuations in their cashflow.
The government this month introduced its Small Business Protections Bill to Parliament to “end the scourge of late payments”.
Late payments “choke growth, cost jobs, and force too many good businesses to close,” said business secretary Peter Kyle, co-introducing the legislation.
Carrotte added that a bad debt could make the difference between solvency and “shutting up shop”.
“It gives business owners sleepless nights, can end marriages, relationships and jobs – so a spike in late payment as we are seeing at the moment has a real effect on people who are simply trying to earn an honest living.”
Caution would be needed within the sector as the war continues, Napier added.
“At times like these, it’s critical that businesses have the right protection in place to safeguard liquidity as the market continues to shift.”
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