Despite challenging economic times, U.S. businesses continue to pay their invoices in a timely manner, according to Cortera’s July 2011 Supply Chain Index (SCI) report. This monthly index of accounts receivable (A/R) activities analyzes 200,000 manufacturers, distributors & wholesalers, retailers, services, and transportation companies. The July 2011 SCI registered 6.16 days beyond terms (DBT), remaining near its record low of 5.05 in May 2011.
The Cortera SCI tracks late payments against agreed upon terms, measuring late accounts receivable (Late A/R), excessively late accounts receivable (Late A/R >30 days), and overall average days beyond terms (Average DBT).
While the latest numbers are the best Cortera’s vice president, Alex Coté, has seen since the index was introduced in April 2007, he does have concerns.
“While businesses are currently paying their bills fast partly because they are confident they will continue to get paid equally fast by their existing customers, they don’t appear to be investing aggressively because of mixed economic news and fears over another recession,” he said. “Overall it’s a conservative, wait and see approach to working capital management.”