Freight and Haulage

Payment Behaviour Analysis: Freight and haulage Sector

Based on a detailed evaluation of 88 companies within the Freight and haulage sector, the data reveals a payment landscape that centres around a moderate settlement timeframe. The arithmetic mean payment time stands at 39.5 days, whilst the median is slightly lower at 37 days. This proximity between the mean and median suggests a relatively balanced distribution, though the standard deviation of 16 days indicates that creditor experiences can vary significantly. It is vital to realise that whilst the central tendency points towards a settlement period of just over five weeks, the notable variance implies that suppliers cannot rely solely on the average when forecasting cash flow. The sector does not uniformly favour rapid settlement, requiring stakeholders to analyse individual credit profiles carefully.

A closer examination of the distribution bands allows us to characterise the sector’s reliability more frequently. The largest concentration of companies, comprising 36.4% of the sample, falls within the 'Moderate' category (31–45 days). When combined with the 'Fast' payers (0–30 days), who represent 29.5% of the total, it becomes evident that approximately two-thirds of the sector settle their accounts within a six-week window. However, the interquartile range of 21 days—spanning from the 25th percentile at 30 days to the 75th percentile at 51 days—demonstrates that a significant proportion of payments extend well into the second month. Consequently, suppliers should organise their credit terms with the expectation that receiving payment could routinely take up to 51 days for a quarter of their client base.

Despite the majority of companies adhering to reasonable terms, risk factors remain prevalent amongst the dataset. The analysis highlights that 29.7% of payments are classified as late, a figure that warrants close monitoring by credit controllers. Furthermore, the 'Slow' (46–60 days) and 'Very Slow' (61–90 days) categories account for a combined 33% of the sector. Whilst only one company was identified as a critical risk (taking over 90 days), the presence of a 'Very Slow' cohort suggests systemic cash flow retention strategies amongst certain players. The extreme variance is further emphasised by the disparity between the fastest payer, settling in a mere 8 days, and the slowest, taking 100 days to pay.

Geographically, the data is distributed across key economic hubs, including London, the South East, and the Midlands, suggesting that these payment behaviours are systemic to the Freight and haulage trade rather than being regionally isolated anomalies. In conclusion, whilst nearly 45% of the sector manages to settle debts within 30 days, the prevailing trend favours extending terms into the 37-to-50-day range. Businesses trading within this sector must specialise their collections processes to handle this delay and should be wary of the minority of firms pushing terms beyond the 60-day threshold.