Alcoholic Beverages

Payment Behaviour Analysis: Alcoholic beverages Sector

This report aims to analyse the current payment behaviour within the Alcoholic beverages sector, utilising a dataset of 104 companies to determine financial risk and operational efficiency. The data reveals a payment culture that is firmly entrenched in mid-term settlement practices. The central tendency of the sector is remarkably consistent; the average payment time stands at 45.8 days, which aligns almost perfectly with the median of 45 days. This symmetry suggests a stable distribution curve where extreme skewing is minimal. However, whilst the average suggests a standard term of roughly six weeks, the standard deviation of 20.4 days indicates that a significant level of variability exists amongst individual organisations. Consequently, suppliers must realise that payment terms can fluctuate considerably depending on the specific trading partner.

When we examine the distribution of payment speeds, it becomes evident that the sector does not overwhelmingly favour rapid settlement. Only 26 companies, representing exactly 25.0% of the sample, manage to settle their accounts within the 'Fast' window of 0-30 days. The bulk of the sector is concentrated in the 'Moderate' to 'Slow' bands, with nearly 58% of companies taking between 31 and 60 days to pay. The quartile analysis further supports this observation; with the 25th percentile at 31 days and the 75th percentile at 55 days, the interquartile range of 24 days highlights a broad 'middle ground' of performance. Crucially, the data highlights a concerning tail of inefficiency: 17.3% of companies fall into the 'Very Slow' or 'Critical' categories, taking over 61 days to settle invoices.

The analysis of outliers and performance extremes exposes a stark divide in operational capability. Amongst the top performers, seven companies demonstrated exceptional liquidity management, settling debts in under 20 days, with the fastest payer achieving settlement in a mere 4 days. In contrast, the sector is burdened by a minority of poor performers; five companies languish in the critical 90+ day bracket, with the slowest payer taking an excessive 121 days. This represents a severe working capital risk for the supply chain. Furthermore, with 28.3% of all payments classified as late, it is clear that strict credit control procedures are necessary when trading in this vertical. Suppliers must be vigilant, as nearly one in five invoices (18.9%) remains unpaid after two months.

Geographically, the commercial activity for this sample is heavily concentrated in London, which accounts for 35 of the 104 companies analysed. This indicates that the capital remains the primary operational centre for the Alcoholic beverages sector, significantly outpacing regional hubs such as the West Midlands (10 companies) and the East of England (9 companies). For stakeholders looking to engage with this market, the key takeaway is one of caution: whilst 39.6% of payments are made within 30 days, the prevalence of late payments and a 45-day median suggests that cash flow forecasts should be adjusted to accommodate a six-to-seven-week settlement cycle.