The latest data produced from Experian shows that whilst the payment of Business invoices has improved somewhat, there still remains serious issues within many industries and many geographical areas within the United Kingdom.
Research conducted for the financial period between of April 2014 and March 2015 and was used as a comparative on data complied for the same previous financial year.
It showed the the UK average for payment beyond terms actually fell on average from 25.28 days to 24.29 which was news welcomed by many however it still means that many companies are still making payments far beyond the terms on which they are supposed to highlighting the fact that there is still a major problem with the culture of late payment of commercial invoices in the UK.
The Experian report confirmed that small business with only 1 or 2 employees were the best performing for payment with a much lower average of 20.58 days beyond terms (DBT) Rather ridiculously, the UK’s largest companies with more than 501 employees on average pay their invoices 34.19 DBT
The report also highlights the distinct trends between regions in their payment of invoices. The North West has the highest average DBT with 30.44 yet it is also almost half that in Northern Ireland where the average DBT is only 15.93
A full breakdown of the regions
North West 30.44
North East 25.07
East Midlands 23.39
West Midlands 22.61
South East 20.82
South West 17.93
Northern Ireland 15.93
Within the food industry, there was marked improvements with a huge 3 day reduction in their average DBT whilst the leisure industry also experienced a significant drop in late payment, falling over two days in the average DBT. Whilst many industries showed great improvement, the postal and telecoms industry remains at the peril of creditors with a huge average DBT of 44.44
Marc Curtis-Smith, Managing Director of leading Debt Recovery firm, Federal Management said “This is extremely positive news especially for SME’s in the UK. Late payment of invoices and accounts can dramatically affect a company’s profitability and hinder growth plans”.
“However, whilst Experian’s latest figures show a small drop, unpaid invoices and overdue accounts remain a very valid threat to company’s cash flow and they should always act sooner than later or risk the potential of not being paid at all”