Companies paid 24.58 days beyond terms from April to June 2013 compared to 23.46 days for the same period in 2012, according to a study by information services company Experian.
When compared to the same quarter last year, the UK’s largest companies (501+ employees) experienced the highest annual increase of over three days from 30.91 in Q2 2012 up to 34.19 in Q2 2013.
However, the quarterly analysis shows a more stable picture with businesses paying their bills between April and June 2013 marginally faster than the last two consecutive quarters.
This was led by the UK’s smallest businesses, with 1-2 and 3-5 employees. In Q2 this year, UK firms were paying their overdue invoices 24.58 days after agreed terms, compared to 24.65 days in Q1 and 25.63 days in Q4 last year.
Max Firth, UK managing director for Experian’s business information services division says, ‘Between March 2009 and June 2012, the UK’s largest firms saw the biggest improvements in their payment performance – falling by 12 days over this period.
‘No other size of business saw such levels of improvement. Although these firms are still paying their suppliers faster than they were in 2009, the slowdown in payment over the past 12 months will be felt by the wider supply chain.’
Firth adds that these firms deal with hundreds of suppliers across multiple sites, numerous departments and hundreds of employees, so bringing their payment performance in line with smaller firms is a real challenge.
‘Smaller businesses should consider spending time and resources to ensure they get paid on time.’
Although payment performance among firms in the North West has worsened since last year, from 28.63 in Q2 2012 to 31.14 Q2 2013, the more recent picture reveals the region as seeing the biggest quarterly improvement with firms paying their late bills three days earlier compared to the last quarter.
It was one of four areas to experience a quarterly improvement with the others being the East Midlands, West Midlands and Scotland.
The UK’s second and third biggest industries both saw a year-on-year improvement with building and construction going from 21.35 last year to 21.30 and property from 30.11 to 29.64 days this year.
Businesses in the spirits, wine and tobacco industries saw the biggest improvement since Q2 2012 with a drop of over five days from 14.77 to 9.70 this year making it the fastest-paying industry in the UK.