Experian’s latest Business Benchmark Report shows signs of improvement in business performance in Q4
Costa Mesa, Calif., Jan. 24, 2012 — Experian®, the leading global information services company, today released its Q4 Business Benchmark Report, which shows general improvement in business performance in most categories quarter over quarter, while metrics remain negative from a year-over-year perspective.
Risk scores remained relatively flat across all industry groups and geographic regions quarter over quarter and year over year. Interestingly, the largest businesses (those with more than 1,000 employees) showed the greatest quarter-over-quarter improvement (2.2 percent) but the largest decline (14.7 percent) year over year.
Days beyond terms (DBT) appears to be stabilizing quarter over quarter, across all business sizes, industry groups and geographic regions. However, DBT remains significantly negative year over year, increasing by as much as 13.8 percent.
The percentage of dollars delinquent has remained relatively flat quarter over quarter, with the exception of larger businesses (those with 250 or more employees) that have shown significant improvements, reducing their debt by as much as 11 percent. Performance in this category varies quarter over quarter by industry sector and geographic region. Year over year, the change in percentage of dollars delinquent varies across all business sizes. Notably, midsize businesses (those with 250 to 499 employees) saw the greatest positive change, improving by 35.9 percent.
“The general stabilization and signs of improvement seen in Q4 are encouraging. No matter what the business size, industry or geographic region, having a strong risk score, paying bills on time and reducing delinquent debt are important elements to achieving a positive business profile,” said Allen Anderson, president, Experian’s Business Information Services. “Building and maintaining positive credit is critical to a business’s success, because it helps them obtain more favorable payment terms or interest rates.”
Other findings from the Q4 Business Benchmark Report include the following:
Risk score*
• The average commercial risk score* in December 2011 was 57.4. This metric remained relatively stable over the Q4 2011 time period and over the previous year.
• The largest businesses (those with more than 1,000 employees) showed the greatest improvement (2.2 percent) in their commercial risk score quarter over quarter. When compared year over year, the analysis showed that businesses of all sizes remained relatively stable in commercial risk score, with the exception of the largest businesses that showed a significant decline, decreasing by 14.7 percent.
• Quarter over quarter, all regions showed a slight improvement in commercial risk score, with the Southeast showing the greatest improvement at 1.2 percent. When compared with the previous year, the Southeast and Plains businesses showed the greatest decline in commercial risk score decreasing by as much as 3.5 percent.
*Based on a scale of 1 to 100 (with 100 being least risky) and predicts the likelihood of severe delinquency (more than 91 days past due) within the next 12 months
Average days beyond terms (DBT)
• U.S. businesses paid their bills an average of 7.3 days beyond contracted terms in December 2011. This metric remained relatively flat quarter over quarter, showing a 1.6 percent increase. When compared year over year, DBT has seen a 13.8 percent increase.
• Quarter over quarter, all business sizes have remained relatively stable in their payment performance, showing only slight worsening. When compared with the previous year, however, businesses of all sizes showed an increase in DBT, which is consistent across all industries and geographic regions.
Percentage of dollars delinquent
• The national average percentage of dollars delinquent and the percentage of dollars considered severely delinquent (more than 91 days past due) have remained relatively stable, increasing by 1.4 percent and 1.7 percent respectively quarter over quarter. Compared with the previous year, both metrics have increased by 7.6 percent and 16.2 percent, respectively.
• Quarter over quarter, the Communications sector showed the greatest decrease in delinquent dollars, improving by 28.0 percent. When compared with the previous year, the Finance and Utilities sectors showed the greatest decrease in percentage of dollars delinquent, improving by as much as 28.4 percent. Among the largest increases in percentage of dollars delinquent were the Legal Services (20.8 percent) and Real Estate (19.5 percent) sectors.
• Quarter over quarter, the Communications sector showed the greatest decrease in percentage of dollars considered severely delinquent, improving by as much as 34.0 percent. Year over year, the Utilities sector showed one the greatest decreases in percentage of dollars considered severely delinquent, improving by 29.3 percent. Conversely, Real Estate, Legal Services and Public Services showed the greatest increase in percentage of dollars considered severely delinquent, rising by as much as 36.8 percent year over year.
• Quarter over quarter, New England, Mid-Atlantic, Southeast and Plains regions showed the greatest increase in percentage of dollars delinquent, worsening by as much as 7.8 percent. Year over year, businesses in the Plains, Midwest and Southeast regions showed the greatest increase in percentage of dollars delinquent, rising by as much as 20.3 percent. Meanwhile, the Northeast and South Central regions showed the greatest decrease in percentage of dollars delinquent, improving by as much as 7.2 percent over the same time frame.
• The quarter-over-quarter comparison showed that most regions increased their percentage of severely delinquent dollars, with the New England and Northeast regions showing the greatest increase, rising by as much as 7.9 percent. Conversely, the Mountain region showed the greatest decrease in percentage of dollars considered severely delinquent, improving by 8.9 percent. Year over year, most regions showed an increase in percentage of severely delinquent dollars. The Mountain, Northwest and Midwest regions showed the greatest increase, rising by as much as 29.9 percent.
Business Benchmark Report |
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December 2011 |
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Quarter change |
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Risk score |
Average DBT |
Percent $ delinquent |
Percent $ 91+ |
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Risk score |
Average DBT |
Percent $ delinquent |
Percent $ 91+ |
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National average |
57.4 |
7.3 |
10.3% |
6.5% |
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0.7% |
1.6% |
1.4% |
1.7% |
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Number of employees |
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Nonemployer |
59.4 |
7.0 |
7.1% |
5.5% |
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0.9% |
1.9% |
1.5% |
1.4% |
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One to four |
55.5 |
8.5 |
16.7% |
13.2% |
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0.6% |
1.4% |
1.4% |
2.4% |
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Five to nine |
53.4 |
7.9 |
14.4% |
10.5% |
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0.3% |
1.1% |
1.2% |
1.4% |
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10 to 19 |
52.6 |
6.7 |
12.1% |
7.3% |
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0.0% |
1.4% |
4.2% |
7.8% |
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20 to 49 |
54.5 |
5.2 |
9.8% |
4.8% |
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-0.1% |
1.4% |
3.0% |
4.5% |
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50 to 99 |
55.9 |
4.4 |
9.3% |
3.5% |
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-0.1% |
2.0% |
-0.3% |
4.5% |
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100 to 249 |
54.3 |
4.4 |
8.9% |
1.8% |
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-0.2% |
1.2% |
10.3% |
-5.0% |
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250 to 499 |
52.5 |
4.8 |
5.9% |
1.3% |
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0.2% |
1.4% |
-11.0% |
-3.4% |
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500 to 999 |
51.4 |
5.4 |
8.2% |
0.5% |
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0.0% |
2.1% |
-7.1% |
-11.1% |
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1,000 and more |
35.6 |
7.5 |
18.1% |
1.3% |
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2.2% |
1.3% |
-1.5% |
-24.2% |
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Risk score |
Average DBT |
Percent $ delinquent |
Percent $ 91+ |
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Risk score |
Average DBT |
Percent $ delinquent |
Percent $ 91+ |
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Industry group |
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Agriculture |
61.7 |
9.6 |
13.3% |
9.2% |
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0.7% |
6.2% |
8.2% |
8.8% |
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Forestry |
64.8 |
4.6 |
12.1% |
5.5% |
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0.3% |
6.6% |
55.9% |
55.7% |
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Mining |
59.0 |
3.8 |
2.7% |
0.2% |
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-0.1% |
5.4% |
-5.4% |
-16.8% |
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Construction |
54.1 |
13.1 |
25.9% |
19.2% |
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0.3% |
1.5% |
7.5% |
8.1% |
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Manufacturing |
54.8 |
5.6 |
12.8% |
4.7% |
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-0.1% |
1.3% |
7.1% |
7.3% |
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Transportation |
52.8 |
7.9 |
11.3% |
5.8% |
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0.4% |
1.7% |
-1.6% |
3.8% |
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Communications |
49.1 |
8.8 |
13.9% |
6.9% |
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0.1% |
1.6% |
-28.0% |
-34.0% |
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Utilities |
68.7 |
5.9 |
8.8% |
3.2% |
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10.1% |
1.8% |
7.2% |
5.4% |
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Wholesale trade |
55.0 |
5.4 |
8.9% |
3.6% |
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0.0% |
1.2% |
1.6% |
5.1% |
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Retail trade |
51.1 |
7.6 |
15.2% |
7.0% |
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0.4% |
0.9% |
-0.2% |
-1.3% |
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Finance |
49.1 |
9.4 |
9.6% |
7.5% |
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0.7% |
1.2% |
-2.3% |
-1.8% |
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Insurance |
57.0 |
5.6 |
13.0% |
8.8% |
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0.5% |
1.6% |
0.6% |
1.9% |
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Real estate |
55.5 |
7.3 |
8.0% |
6.3% |
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0.5% |
1.3% |
0.7% |
3.8% |
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Hospitality |
51.3 |
5.4 |
4.6% |
3.0% |
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0.7% |
1.3% |
4.2% |
-2.8% |
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Business services |
53.1 |
9.8 |
13.9% |
10.1% |
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0.6% |
1.3% |
0.4% |
1.3% |
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Health services |
59.4 |
4.0 |
7.5% |
4.3% |
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0.5% |
1.1% |
1.7% |
-0.1% |
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Legal services |
55.1 |
5.0 |
15.4% |
10.1% |
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0.4% |
1.5% |
1.5% |
1.8% |
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Educational services |
60.3 |
5.1 |
9.5% |
6.1% |
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0.2% |
1.3% |
-1.2% |
-0.9% |
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Public administration |
59.7 |
3.7 |
10.6% |
5.0% |
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0.4% |
2.1% |
2.8% |
9.4% |
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Risk score |
Average DBT |
Percent $ delinquent |
Percent $ 91+ |
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Risk score |
Average DBT |
Percent $ delinquent |
Percent $ 91+ |
Region |
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Mid-Atlantic |
60.2 |
5.6 |
25.2% |
13.5% |
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0.5% |
1.8% |
6.6% |
5.4% |
Midwest |
58.6 |
11.0 |
21.2% |
14.8% |
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0.6% |
1.5% |
3.7% |
2.8% |
Mountain |
57.3 |
3.9 |
3.0% |
1.6% |
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0.8% |
2.5% |
-6.0% |
-8.9% |
New England |
61.4 |
4.6 |
24.6% |
12.9% |
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0.4% |
1.8% |
7.8% |
7.9% |
Northeast |
55.6 |
5.2 |
24.8% |
13.5% |
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0.2% |
1.5% |
-0.8% |
6.1% |
Northwest |
60.5 |
4.0 |
8.3% |
3.7% |
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0.4% |
1.4% |
-0.9% |
-2.1% |
Plains |
59.9 |
5.7 |
15.0% |
7.0% |
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0.8% |
2.9% |
5.1% |
4.2% |
South Central |
57.3 |
5.5 |
5.6% |
2.4% |
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0.9% |
1.9% |
1.2% |
1.9% |
Southeast |
54.0 |
9.9 |
24.4% |
17.1% |
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1.2% |
1.7% |
5.2% |
6.0% |
Southwest |
57.1 |
6.5 |
4.6% |
3.3% |
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0.6% |
1.1% |
0.6% |
1.0% |
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 http://www.experian.com/business-benchmark-report.
Contact:
Roslyn Whitehurst
Experian Public Relations
1 714 830 5578
roslyn.whitehurst@experian.com
About Experian’s Business Benchmark Report
Experian’s Business Benchmark Report is a quarterly look at how businesses are faring in the United States. Designed to monitor the health of U.S. businesses, the report focuses on key risk indicators such as commercial risk score, DBT and percentage of delinquent debt. The Q4 report reflects December 2011 data as well as a trending view of the October–December 2011 time period.
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 http://www.experian.com/b2b.
About Experian
Experian is the leading global information services company, providing data and analytical tools to clients in more than 80 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.
Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended March 31, 2011, was $4.2 billion. Experian employs approximately 15,000 people in 41 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; Costa Mesa, California; and São Paulo, Brazil.
For more information, visit http://www.experianplc.com.
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