Asset and Investment Management

Sector Payment Analysis: asset and investment management

Based on a comprehensive dataset of 201 companies, this report presents an analysis of the financial conduct and payment behaviour within the asset and investment management sector. The data reveals a highly efficient payment culture that significantly outperforms many other UK industries. The central tendency metrics indicate a swift turnover of invoices, with an average payment time of 22.5 days and a median of 20 days. The close proximity of the mean to the median suggests a stable distribution, free from the skewing effects of massive outliers. With a standard deviation of 12.2 days, the variance in payment practices amongst these firms is relatively low, providing suppliers with a high degree of predictability regarding cash flow.

A detailed examination of the distribution highlights a strong propensity for prompt settlement. An overwhelming 82.6% of the companies analysed (166 entities) settle their invoices within the 0-30 day window, categorising the vast majority of the sector as 'Fast' payers. Furthermore, the interquartile range is notably narrow at 13 days, with the 75th percentile falling at just 28 days. This statistic is critical; it signifies that three-quarters of the sector realises the importance of supply chain liquidity, settling debts in under a month. It is also worth noting that nearly half of the sample (96 companies) are classified as top performers, finalising payments in fewer than 20 days. Conversely, the 'Very Slow' category (61-90 days) comprises only 2.5% of the sample, and significantly, there is a complete absence of 'Critical' payment behaviour (90+ days).

Whilst the raw speed is impressive, it is crucial to analyse the distinction between payment speed and contractual adherence. Despite the swift average speeds, 17% of payments are classified as 'late'. This juxtaposition suggests that whilst companies pay quickly in absolute terms, the standard terms in this sector may be exceptionally tight—likely often set at 14 days or immediately upon receipt—rather than the standard 30-day net. Geographically, the dataset is heavily London-centric, with 165 companies located in the capital. This concentration may skew the behaviour towards the automated, centralised financial practices typical of large metropolitan firms, contrasting with the disparate distribution found in the North West or the East of Scotland.

In conclusion, the asset and investment management sector demonstrates robust financial health and responsible payment behaviour. The credit risk profile for suppliers is notably low, as evidenced by the fact that only 5.1% of invoices remain unpaid after 60 days. The fastest payer settled within a mere 3 days, whilst the slowest recorded payer took 73 days, which remains well below the critical delinquency threshold. For credit controllers and business analysts, this sector represents a favourable environment where cash flow is fluid. Suppliers trading amongst these firms can reasonably anticipate settlement within three weeks, providing they organise their invoicing processes efficiently to match the sector's rapid tempo.