Cleaning

Sector Payment Analysis: Cleaning

This report serves to analyse payment behaviour within the Cleaning sector, drawing upon a dataset of 59 companies to evaluate financial stability and supplier risk. The data reveals a payment culture that centres around a median settlement time of 38 days, which aligns closely with the arithmetic mean of 39.5 days. This central tendency suggests that the standard commercial practice within the industry is to settle accounts shortly after the traditional 30-day term. However, whilst the average appears stable, the standard deviation of 19 days indicates a moderate level of variability. Suppliers should realise that reliance on the average alone may be misleading; the actual experience can fluctuate significantly depending on the specific trading partner.

A granular examination of the distribution bands allows us to better organise the sector’s risk profile. The interquartile range—spanning 27 days from the 25th percentile (25 days) to the 75th percentile (52 days)—demonstrates that the middle 50% of the market operates within a reasonably predictable window. Notably, the 'Fast' category (0–30 days) is the largest single cohort, representing 39.0% of the sample. When combined with the 'Moderate' band (31–45 days), we observe that over two-thirds of the sector generally settle debts within six weeks. Nevertheless, a bifurcation in strategy is evident; whilst many companies favour prompt settlement to maintain supply chain goodwill, a significant minority appear to specialise in working capital preservation by extending terms, with 30.5% of companies taking longer than 45 days to pay.

The analysis of outliers and risk metrics highlights critical concerns amongst the slower payers. Although seven top performers boast impressive settlement times of under 20 days—with the fastest payer settling in just 7 days—the tail end of the distribution is worrying. Approximately 11.9% of the companies analysed fall into the 'Very Slow' or 'Critical' categories, taking over 60 days to release funds. The most extreme outlier, taking 114 days to pay, represents a severe liquidity risk to smaller suppliers. furthermore, with 19.5% of all payments classified as late, it is evident that adherence to agreed terms remains inconsistent across the board.

Finally, the geographical distribution of the sample underscores the dominance of the south, with London and the South East accounting for 25 of the 59 entities (42%). This concentration suggests that payment trends in the Cleaning sector are heavily influenced by capital-centric business practices. As we monitor these regional hubs, it becomes clear that credit controllers must remain vigilant. The disparity between the sector's efficient payers and the 15.9% who pay over 60 days suggests that comprehensive credit checks are essential before extending significant lines of credit.