27 March 2008
United Utilities has been named as the slowest firm to pay its suppliers.
Research from the Institute of Credit Management (ICM) examined all UK public companies and published league tables of the best, worst and most improved payers. Just behind United Utilities, which averaged 99 days for payment, were AGA Foodservice Group, which took 81 days, and construction and support services firm Carillion, at 80 days.
A spokeswoman for United Utilities said the figure given by the ICM equated to less than 1 per cent of its overall transactions. She said the water firm's average payment time is actually 23 days and that successful business relies on good relations with suppliers.
Carillion said its average payment time is 65 days. AGA Foodservice Group would not respond to SM's request for comment.
The average payment time across all sectors was 44 days. The average was slightly quicker among FTSE 350 index firms, which take 34 days.
René de Sousa, former Better Payment Practice Group representative, said that late payment terms could be detrimental to business relationships.
"Late payment has been an issue for a number of years. Buyers and suppliers should take the time to do financial checks on each other," he advised.
He added the global credit crunch highlighted the importance of paying suppliers in accordance with agreed terms, but explained vendors could offer discounts for prompt payment.
Among the fastest payers were easyJet, which averaged 9 days, and publishing firm EMAP, averaging 11 days.
One of the most improved firms was online marketplace Tradus, which improved its payment time by 47 days, to 33.