Businesses Continue to Settle Bills Earlier, According to Latest Experian Analysis

Nottingham, 22 April 2010 — The latest Late Payment Index from Experian®, the global information services company, shows that UK businesses are paying their bills significantly faster than they did this time last year.

Experian ’s analysis shows that during January to March this year, businesses paid their bills an average of 20.93 days late compared to 23.61 days late in Q1 2009. 

Joe Myers, Head of Commercial Credit at Experian, said: “This is a positive step for businesses, mirrored by a stabilization in business insolvencies over the last year.  Businesses of all sizes know the impact a late payment can have on their cash flow and also just how important it is to regularly monitor a customer’s ability to pay on time.”

Compared to October to December 2009 (20.82 days), payment performance in the first quarter of 2010 was fractionally slower.  According to Experian’s experts, the slight lag is most likely to be due to the ‘Big Freeze’ in January that saw travel and postal services disrupted across most of the UK.

Highlights include:

  • Of the five regions that saw an improvement from Q4 2009, the biggest came from the South West.  It also continues to be the region where businesses pay their late bills the fastest – 16.07 days late.
  • The biggest increase in late payment came from Scottish businesses, but this was still only a minor increase - from 22.09 in Q4 2009 to 22.67 in Q1 2010. 
  • Greater London saw the greatest Q1 2009 to Q1 2010 improvement – from 28.73 days to 23.89 days.
  • In terms of size of business, only the smallest businesses saw improvements from Q4 2009 to Q1 2010 - those falling into the 1 to 2, 3 to 5 and 6 to 10 employees categories.
  • The biggest increase from Q4 2009 in overdue days came from businesses with 26 to 50 employees - from 18.96 days to 19.36 days.
  • Micro businesses (1 to 2 employees) led the improvements from Q1 2009 to Q1 2010 – from 20.76 days to 17.90 days.
  • For the first time, property businesses overtook postal/telecommunications businesses as the sector with the worst payment performance – paying their bills 33.60 days after agreed terms. 
  • The biggest improvement from Q4 2009 came from the utilities sector (from 29.12 days) followed by the breweries (from 18.59 days) and IT (from 16.13 days).
  • Spirits/wine/tobacco businesses saw the worst deterioration from Q4 2009 (from 18.63 days) followed by food retailing (from 25.84 days) and banking/financial services (from 24.87 days).
  • Food retailing was also the sector to see the biggest increase in overdue days from Q1 2009 – from 24.29 days to 26.76 days.

 

Government Region

Days beyond terms Q1 2010

% change from Q4 2009

% change from Q1 2009

Scotland

     22.67

2.6

-3.2

North East

     23.03

-1.1

-7.1

North West

     24.47

0.4

-6.7

Yorkshire

     21.96

0.4

-6.2

Wales

     21.08

1.6

-8.1

West Midlands

     23.24

-0.2

-10.1

East Midlands

     20.19

1.5

-8.2

Eastern

     19.07

1.1

-12.5

South West

     16.07

-1.2

-14.2

Greater London

     23.89

1.1

-16.8

South East

     16.76

-0.7

-16.6

Northern Ireland

     18.34

-0.4

-12.4

National Average

     20.93

0.5

-11.4

Source: Experian

 

Employment

Days beyond terms Q1 2010

% change from Q4 2009

% change from Q1 2009

1-2

     17.90

-1.5

-13.7

3-5

     19.35

-0.9

-9.4

6-10

     18.73

-0.1

-8.7

11-25

     18.68

0.6

-7.1

26-50

     19.36

2.1

-8.4

51-100

     20.28

0.5

-10.7

101-500

     24.54

1.7

-7.3

501+

     36.45

1.0

-10.5

Unspecified

     25.20

1.3

-18.3

National Average

     20.93

0.5

-11.4

Source: Experian

 

Industry Sector

Days beyond terms Q1 2010

% change from Q4 2009

% change from Q1 2009

Extractive Industries

     22.35

1.2

5.5

Oil

     13.05

-0.1

-35.5

Building and Construction

     21.08

2.3

1.4

Building Materials

     19.13

0.8

-1.0

Chemicals Industry

     16.70

0.7

-14.0

Diversified Industrials

     18.82

-0.3

-1.9

Electricals

     15.96

-4.0

-21.9

Engineering

     17.22

-2.4

-7.3

Printing, Paper and Packaging

     18.81

-4.5

-18.7

Textiles and Clothing

     23.73

-3.0

-10.7

Breweries

     17.59

-5.4

-36.6

Spirits, Wine and Tobacco

     20.07

7.7

5.3

Food Manufacturing

     20.75

-0.7

-11.1

Pharmaceuticals

     17.41

-4.1

-2.5

Wholesaling

     17.98

-1.0

-14.0

Leisure and Hotels

     29.15

2.3

8.2

Media

     19.54

-0.4

-15.3

Food Retailing

     26.76

3.6

10.2

Non-Food Retailing

     19.69

-0.8

-7.8

Servicing/Repair

     14.60

1.5

-6.7

Transport

     19.69

-3.2

-12.6

Utilities

     26.13

-10.3

-28.8

Postal and Telecommunications

     33.02

-0.8

-24.8

Agriculture, Forestry and Fishing

     10.31

2.4

-17.6

Banking and Financial Services

     25.73

3.5

-17.0

Health and Household

     17.79

-0.9

-16.3

Business Services

     19.27

0.7

-21.8

Hiring and Leasing

     22.30

1.8

2.0

Property

     33.60

2.5

-11.1

Other Services

     17.52

0.2

-15.2

Plastics & Rubber

     21.11

-1.4

-6.8

Insurance

     20.88

2.4

-18.4

IT

     15.30

-5.1

-48.3

Motor Traders

     14.97

-2.1

-10.6

Unspecified

     31.91

-6.4

-43.9

National Average

     20.93

0.5

-11.4

Source: Experian

Contact:
Serj Heera
PR Manager, Business Information and Automotive
+44 (0) 115 992 2773
serjeet.heera@uk.experian.com

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