Firms slow to pay up - Brief Article

Electronics Times, June 26, 2000

The electronics sector may be in an upswing but companies are taking longer to pay their suppliers, according to research group Experian.

It says that the electronics and engineering sector has experienced a four-day rise in payment times since last September to 62.24 days.

Payments from large companies are taking even longer to reach suppliers at 78 days, again up four days in the last nine months.

Experian's Steve Kilmister said: "Late payment is often an indication of potential cash flow problems. It is noticeable from the latest figures that many of those sectors with the worst performance are those that are most adversely affected by the strong pound and rising interest rates."

But Experian's research also points to a progressive two-year rise in payment times across UK industry and regardless of a company's size.

On the export front, electronics has suffered from sterling and interest rates, although the sector is by no means the worst for payment. Large vehicle and equipment rental companies can take 85 days to settle invoices, while the oil industry has the highest across the board average at 70.6 days.