11 August 2010 | Angeline Albert
Provident Financial has reduced the average time it takes to pay its suppliers by seven days – but is still paying late – according to its latest corporate responsibility report.
The Bradford-based financial services company, which serves 2.3 million customers in the UK and Ireland, is settling bills with vendors 18 days late on average, instead of the 25 additional days it generally took in 2008.
This figure compares favourably to Experian’s late payment index, which in December 2009 reported businesses were paying suppliers an average of 20.9 days after the agreed terms. Provident Financial said the reduction in payment time was part of its commitment to treat suppliers fairly.
“Late payment can severely affect businesses’, and particularly small and medium-sized businesses’, cash flow. This is particularly important in these tough economic times,” the report said.
In 2009, the firm built corporate responsibility requirements into invitation to tender documents, as well as new and renewed supplier contracts. To ensure responsible purchasing is considered early on, it included social, environmental and ethical questions in both the pre-qualification and invitation to tender stages.
The company’s report also said it plans to carry out corporate responsibility spot checks of selected existing suppliers in 2010.
The firm’s procurement spend in 2009 was £87.7 million (in 2008 it was £96.9 million). Provident Financial employs 3,700 people and has 11,600 self-employed agents.