Connect with us

Collecting Payment Is Not Getting Easier a Survey Says



Collecting PaymentPreviously, I said that collecting your payment (cash or check) isn’t getting easier these days—having slower cash flow is a story that belongs to every business. Everyone falls behind to pay. Well that was a rough sense of mine. But, hey, Dun & Bradstreet say the same. While the economic outlook was a bit rosier, according to a new Dun & Bradstreet report, business delinquency rates are actually up compared with last year.

So again, you are not alone. In fact, businesses report that the percentage of dollars they owe that are more than 90 days past due is only slightly lower than it was at the peak of the recession.


Oh yea, you’re right. The payment slow down could be part of big players’ strategic financing mechanism, writes. According to D&B, the percentage of companies with more than 50 employees that reported they were paying late increased for all size categories between April 2010 and March 2011, generally by 3% to 5%.

While larger businesses historically take longer to pay, now “some large corporations are telling suppliers it will be 90 days and even 120 days until they’ll see payment,” compared with standard 30-day terms, says Ernie Brown of Financial Manager’s Resource, as it is cited by

Even though smaller firms get less slack from their vendors, they are also more concerned with paying on time as they face harsher consequences for late payments, including worsening credit ratings. Small businesses are in fact improving their payment rates. According to D&B, the percentage of firms with fewer than 50 employees that reported late balances decreased about 4% between spring 2010 and spring 2011.

As for the industry category, the highest delinquency rates for the first quarter were manufacturing, telecommunications, and automotive. Real estate, natural resources, and insurance were the industries with the lowest delinquency rates, according to D&B.

In this situation, chasing customers for on time payment is always a good idea. And taking care of your own company debt is equally important, in other side. Be prepared to negotiate it. Your vendor may start calling your for on time payment too. (Ref:

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Are you looking for easy accounting tutorial? Established since 2007, hosts more than 1300 articles (still growing), and has helped millions accounting student, teacher, junior accountants and small business owners, worldwide.


Related pages

refresh a pivot tablemasters in accounting starting salarycapital lease examplehow to impair goodwillsunk cost and relevant costforecasted financial statementeoq reorder pointtotal owners equitydeferred tax reversalminimum order quantity calculationcalculating fcffis the cpa exam hardsimple promissory note formaccounts payable workflow diagramaccounting adjusting journal entriesimproper revenue recognitionincome tax provision journal entrycalculate direct materialsgaap book valuesustainable ebitdageneral ledger accounting examplescpa exam tipsnci accountingmonthly flexible manufacturing budgetmanagement representation letter datepromissory note template canadapros and cons of jitfrs 36 impairment of assetsrecoverable amount accountingfurniture and fixtures depreciationcost of goods sold for merchandising companyocf accountingexample of embezzlementpromissory note template word documentexamples of overhead expensessample of cash budgetppe valuationattestation accountingassertions accountingwhat is overstated in accountingmanufacturing income statement statement of cost of goods manufacturedwhat is an unasserted claimformula for rocereflash meaningwhat is logics net worthwhat is accrued salariesbookkeeping month end checklistan activity based overhead rate is computed as followsmachine hour rate method cost accountingpublication 551 basis of assetsdeferred tax asset accounthow to prepare a cash budget managerial accountingvertical analysis of an income statementoperating cash flow direct methodaccounting stockholders equityinterest free promissory noteinventory usage formuladifference between fair value and cash flow hedgebad debt expense on income statementan important purpose of closing entries is tomakalah job order costingcpa exam scorefunctions of ifrshow is cogs calculatedcredit sales formulacorporate promissory note templateadvantages and disadvantages of fixed budgetingnil balance confirmation lettercash float sheetdeferred tax ias 12earnings available to common stockholdersdiluted earnings per share examplesample engagement letter for accounting servicesfixed asset useful life gaappoc calculationcredit sales accounting entryexamples of accounting concepts