According to the latest business-to-business payment figures from Dun & Bradstreet Trade Payment Analysis July 2010, Australian firms took an average of 53.4 days to settle accounts in the June quarter, still well above the average terms of trade of 30 days. Firms with 50-199 employees were however the biggest improvers compared to the previous year, with payments dropping by 4.1 days. This move made the group the fastest to pay during the June quarter at 49.4 days.
Further, the finance sector was the quickest paying group during the June quarter and the only industry to pay its accounts in less than 50 days. Firms in the mining industry experienced the most significant improvement in payment taking 3.3 days off the time taken to settle accounts.
However, despite firms now being four days quicker to settle their accounts than they were during the height of the Global Financial Crisis, payments exceed the standard 30 day term by more than three weeks and remain above pre-crisis levels. Slow payments such as these place stress on business cashflow and businesses should look for alternative ways to fund these shortages. Debtor finance is designed to improve business cash flow and support business growth by releasing cash tied up in unpaid invoices. Bibby Financial Services is the largest global independent specialist provider of debtor finance and unlike other funding arrangements requires no real estate security, making it more accessible for small and medium sized business owners.
Posted on 02 August 2010