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Contractor accountants’ clients chasing less late payments

Contractor accountants’ clients chasing less late payments

Companies are now taking slightly less time to settle their invoices than they did in quarter 3 last year, according to Experian.

Experian’s research shows that, on average, companies settled their bills 22.61 days late last quarter, instead of the 23.17 days they took in the comparable period last year.

Micro businesses, those with just 1 or 2 employees, settled up the fastest in Q3 taking an average 19.43 days. Companies with 500 or more employees are still the slowest payers, but they registered the best improvement level. In the third quarter of 2009, the largest firms were taking 39.33 days to pay up and this has now reduced by just over 4 days to 35.31 days.

Sector wise, the largest improvement was in Spirits, Wines and Tobaccos where the average settlement period reduced by 3.23 days to 15.95. Overall, the fastest paying sector is still Agriculture, Forestry and Fishing and is the only industry to settle less than 10 days late. The slowest payers are to be found in the Postal and Telecoms sector with an average settlement time of 39.13 days beyond agreed terms.

On a regional basis the South West showed the best improvement whilst Yorkshire, the North West and Scotland all recorded worse late payment times than in the corresponding period last year.

Meanwhile, large companies that try to persuade suppliers and contractors to reduce their costs are coming under fire. Serco, the outsourcing giant, demanded a 2.5% cash rebate from almost 200 of its suppliers. They did however retract the demand after receiving much criticism from business groups and politicians.

© 2010 All rights reserved. Reproduction in whole or in part without permission is prohibited.

Image: Time Watching by Simon Peckham

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