Cars

Analysis of Payment Behaviour in the Cars Sector

We have conducted a rigorous review to analyse the payment practices of 605 companies operating within the Cars sector. The data reveals a moderately healthy payment culture, though significant variance exists amongst the sample. The central tendency of the dataset indicates an average payment time of 37.5 days, which sits slightly higher than the median of 34 days. This discrepancy suggests a slight skew caused by a tail of slower-paying entities. With a standard deviation of 18.8 days, we realise that payment reliability varies considerably; whilst the centre of the data suggests a standard term of roughly one month, creditors must be prepared for volatility in cash flow when engaging with this sector.

A detailed examination of the distribution clusters reveals that the majority of companies favour a payment schedule falling between immediate terms and 45 days. Specifically, the data is evenly split between 'Fast' payers (0-30 days), accounting for 36.7% of the sample, and 'Moderate' payers (31-45 days), comprising 37.2%. Consequently, nearly three-quarters of the analysed companies settle their accounts within a 45-day window. The interquartile range of 20 days—spanning from the 25th percentile at 26 days to the 75th percentile at 46 days—further reinforces this observation. It indicates that the core of the sector operates within a predictable timeframe, allowing suppliers to organise their receivables with a reasonable degree of confidence, provided they are not dealing with the minority of outliers.

Despite the generally positive trends, risk factors remain prominent. Approximately 17.2% of companies fall into the 'Slow' category (46-60 days), and a concerning 7.9% take between 61 and 90 days to pay. Critical attention must be paid to the 1.0% of companies taking over 90 days, with the slowest payer recorded at an alarming 235 days. Furthermore, whilst performance metrics suggest that 50.6% of obligations are met within 30 days, the data highlights that 22.9% of payments are classified as late. This behaviour underlines the necessity for stringent credit control measures, particularly when dealing with the 13.2% of the sector that consistently extends payment terms beyond 60 days.

Geographically, the dataset is heavily weighted towards the South East and the West Midlands, which serve as the primary hubs for this sample, housing 132 and 71 companies respectively. London also features prominently with 62 companies. In conclusion, whilst the Cars sector generally demonstrates acceptable payment behaviour with a strong median performance, suppliers should remain vigilant. The presence of outliers and a standard deviation of nearly 19 days implies that whilst most transactions will proceed smoothly, a lack of due diligence could expose creditors to significant delays.