U.S. Business Payment Behavior is Stabilizing, and Delinquent Balances are Reducing, According to Experian’s Q3 Business Benchmark Report
Costa Mesa, Calif., Nov. 1, 2010 — Experian®, the leading global information services company, today announced the latest results of its Business Benchmark Report. Findings from the now quarterly report show early signs of stabilization in some core metrics. The study shows that even though the national average days that businesses paid their bills beyond contracted terms saw a dramatic increase of as much as 12.1 percent since January 2010, it has since stabilized, showing only slight fluctuations quarter over quarter. The study also shows that during Q3, the percentage of dollars delinquent and the percentage of dollars severely delinquent have begun to return to the levels observed at the beginning of the year, virtually erasing increases of as much as 13.2 percent seen during the year.
Other findings from the Q3 Business Benchmark Report include the following:
Risk score:
- The average commercial risk score* remained relatively flat over the past quarter but has seen a sharp increase of 2.4 percent year to date.
- Very large businesses (those with more than 1,000 employees) showed a 3.7 percent drop in their risk scores over the last quarter, going from 41.6 to 40.1. However, these businesses have shown the greatest overall improvement (21.3 percent) in risk scores since the beginning of the year, when the average score was 33.0.
- The Northeast region has shown the greatest improvement in risk scores consistently since the beginning of the year. The score increased by 6.5 percent since the end of Q2 and 7.9 percent year to date.
Average days beyond terms (DBT):
- The national average days that businesses paid their bills beyond contracted terms remained relatively flat during Q3 but has seen a 10.3 percent increase since the beginning of the year.
- Very large businesses (those with more than 1,000 employees) and nonemployer businesses (firms with no paid employees) have shown the greatest increase in DBT since the beginning of the year, increasing by 26.5 percent and 13.4 percent, respectively.
- All U.S. regions have shown an increase in DBT since the beginning of the year. The most significant increases were from the Plains states, Midwest and Southeast, rising by 20 percent, 12.9 percent and 12.2 percent, respectively.
Percentage of dollars delinquent:
- After a sharp increase in percentage of dollars significantly delinquent (accounts 91 or more days past due) of 7.6 percent through the first half of the year, Q3 erased some of that increase with a decline of 3.6 percent.
- The largest businesses (those with more than 1,000 employees) and midsize businesses (with 50 to 249 employees) have shown significant improvements in percentage of dollars delinquent since the beginning of the year, decreasing by as much as 11.8 percent. Small to midsize businesses (those with 10 to 99 employees) and larger businesses (with 500 to more than 1,000 employees) showed a sizable improvement in percentage of dollars significantly delinquent in Q3, decreasing by as much as 10.1 percent and 24.2 percent, respectively.
- In terms of severely delinquent dollars, the Southeast has continued to see the most dramatic rise, with a 9.6 percent increase over the last quarter, while the Midwest, Mountain and Southwest regions saw significant improvements, decreasing by as much as 14.2 percent over the same time period.
Monthly trends:
Business Benchmark Report:
| September 2010 | Year-to-date change | ||||||||
|
Risk |
Average |
Percent $ |
Percent |
|
Risk |
Average |
Percent $ |
Percent $ |
National average |
58.5 |
6.4 |
12.7% |
5.5% |
2.4% |
10.3% |
1.8% |
3.0% | |
| |||||||||
Number of employees |
|
|
|
|
|
|
|
| |
Nonemployer |
60.5 |
5.6 |
8.7% |
5.4% |
4.3% |
13.4% |
-0.7% |
8.4% | |
One to four |
56.9 |
7.0 |
14.7% |
8.6% |
-0.3% |
9.5% |
4.4% |
8.9% | |
Five to nine |
54.6 |
8.3 |
14.4% |
7.6% |
-0.7% |
8.3% |
-2.4% |
5.4% | |
10 to 19 |
54.0 |
8.3 |
14.2% |
5.8% |
-0.7% |
6.7% |
-5.0% |
-8.2% | |
20 to 49 |
55.6 |
7.8 |
13.6% |
4.3% |
0.5% |
2.3% |
-5.1% |
-9.1% | |
50 to 99 |
56.5 |
7.3 |
13.7% |
3.1% |
1.2% |
-2.2% |
-8.4% |
-17.1% | |
100 to 249 |
54.9 |
7.5 |
14.2% |
2.5% |
1.8% |
-3.5% |
-8.7% |
-14.5% | |
250 to 499 |
53.3 |
8.2 |
14.9% |
2.0% |
1.0% |
-2.4% |
-4.3% |
-9.3% | |
500 to 999 |
52.0 |
8.8 |
15.9% |
1.7% |
-0.9% |
5.3% |
-4.7% |
17.1% | |
1,000 and more |
40.1 |
8.3 |
17.6% |
1.8% |
21.3% |
26.5% |
-11.8% |
-17.8% | |
|
Risk |
Average |
Percent $ |
Percent |
|
Risk |
Average |
Percent $ |
Percent $ |
Industry group | |||||||||
Agriculture |
63.6 |
5.5 |
9.1% |
4.4% |
|
1.1% |
4.4% |
-15.5% |
-31.1% |
Forestry |
65.7 |
4.0 |
13.8% |
8.9% |
1.4% |
7.0% |
-41.5% |
-50.6% | |
Mining |
60.4 |
5.2 |
8.6% |
0.8% |
0.0% |
6.8% |
10.0% |
-32.9% | |
Construction |
55.5 |
10.5 |
22.0% |
9.1% |
0.1% |
6.1% |
-3.4% |
-7.0% | |
Manufacturing |
55.8 |
9.1 |
15.4% |
4.2% |
-0.9% |
6.8% |
-4.9% |
-6.6% | |
Transportation |
53.4 |
8.2 |
15.0% |
5.8% |
0.3% |
5.6% |
0.4% |
-4.2% | |
Communications |
49.9 |
10.5 |
19.3% |
9.1% |
-0.8% |
11.9% |
17.2% |
15.4% | |
Utilities |
68.9 |
5.3 |
13.6% |
2.4% |
0.1% |
7.4% |
-17.4% |
-54.0% | |
Wholesale trade |
56.2 |
8.0 |
11.9% |
3.3% |
-0.5% |
5.3% |
-6.6% |
-1.8% | |
Retail trade |
52.1 |
8.3 |
16.0% |
5.7% |
-0.5% |
5.4% |
-10.7% |
0.4% | |
Finance |
49.4 |
9.9 |
13.1% |
8.2% |
-2.4% |
26.0% |
6.4% |
2.9% | |
Insurance |
58.6 |
6.8 |
7.1% |
4.8% |
-1.1% |
17.8% |
-14.4% |
-16.1% | |
Real estate |
56.3 |
7.0 |
5.1% |
3.3% |
0.0% |
11.9% |
-4.0% |
-5.0% | |
Hospitality |
52.2 |
7.2 |
6.0% |
2.3% |
-0.2% |
5.5% |
2.5% |
22.9% | |
Business services |
54.4 |
9.2 |
15.5% |
8.4% |
-0.5% |
7.5% |
0.8% |
6.3% | |
Health services |
60.7 |
5.0 |
10.7% |
4.0% |
-0.3% |
7.5% |
1.6% |
5.3% | |
Legal services |
55.9 |
7.2 |
14.3% |
9.4% |
-1.4% |
10.8% |
11.0% |
9.5% | |
Educational services |
61.6 |
5.9 |
10.4% |
5.3% |
0.4% |
10.9% |
-4.0% |
0.4% | |
Public administration |
62.0 |
5.2 |
15.8% |
5.4% |
1.8% |
6.9% |
15.0% |
20.6% | |
|
Risk |
Average |
Percent $ |
Percent |
|
Risk |
Average |
Percent $ |
Percent $ |
Region | |||||||||
Mid-Atlantic |
60.6 |
5.5 |
14.8% |
5.2% |
|
2.0% |
9.3% |
12.5% |
16.1% |
Midwest |
60.2 |
6.7 |
16.4% |
7.1% |
2.6% |
12.9% |
-2.0% |
-7.6% | |
Mountain |
58.8 |
9.6 |
7.9% |
4.0% |
2.7% |
10.8% |
-5.7% |
-1.7% | |
New England |
61.7 |
4.8 |
11.7% |
4.5% |
2.6% |
5.9% |
2.7% |
18.3% | |
Northeast |
55.8 |
4.7 |
14.7% |
6.1% |
7.9% |
7.5% |
0.1% |
11.2% | |
Northwest |
60.8 |
8.1 |
13.1% |
5.5% |
3.0% |
7.9% |
1.7% |
8.2% | |
Plains |
62.1 |
6.1 |
13.8% |
4.9% |
2.9% |
20.0% |
3.2% |
18.6% | |
South Central |
58.7 |
5.6 |
11.8% |
3.7% |
2.9% |
10.5% |
11.4% |
-1.6% | |
Southeast |
56.2 |
7.2 |
15.8% |
7.6% |
1.4% |
12.2% |
16.4% |
24.1% | |
Southwest |
57.1 |
6.4 |
9.0% |
4.6% |
2.5% |
10.3% |
-7.7% |
-8.3% | |
To download previous reports or to see a visual representation of this data and other information broken down by state in an interactive map, visit www.experian.com/business-benchmark-report.
About the Business Benchmark Report
Experian’s Business Benchmark Report is a monthly look at how businesses are faring in the United States. Designed to monitor the progress of business recovery, the report looks at four key indicators of business health, including commercial risk score, days beyond payment terms, percentage of dollars delinquent and percentage of dollars severely delinquent.
Contact:
Roslyn Whitehurst
Experian Public Relations
1 714 830 5578
roslyn.whitehurst@experian.com
About Experian’s Business Information Services
Experian’s Business Information Services partners with organizations to establish and strengthen customer relationships, enabling them to mitigate risk and improve profitability. The company’s business database provides comprehensive, third-party-verified information on U.S. companies of all sizes, with the industry’s most extensive data on the broad spectrum of small and midsize businesses. By leveraging state-of-the-art technology and superior data compilation techniques, Experian is able to provide market-leading tools, such as BusinessIQSM, that assist clients in processing new applications, managing customer relationships and collecting on delinquent accounts. For more information about Experian’s advanced business-to-business products and services, visit www.experian.com/b2b.
About Experian
Experian is the leading global information services company, providing data and analytical tools to clients in more than 90 countries. The company helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score and protect against identity theft.
For more information visit, www.experian.com.
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