Heavy Equipment and Machinery

Payment Behaviour Analysis: Heavy equipment and machinery Sector

This report serves to analyse the current payment landscape within the Heavy equipment and machinery sector, based on a sample of 70 companies. The data indicates a payment culture that leans towards moderate-to-slow settlement terms, with a clear deviation from standard 30-day commercial expectations. The central tendency metrics reveal an average payment time of 44.1 days, closely aligned with a median of 45 days. This proximity between the mean and median suggests a relatively balanced distribution without extreme skewing, yet the timeline itself highlights a tendency for businesses in this sector to delay settlement well beyond the traditional month-end cycle. Whilst the fastest payer settled accounts in just 7 days, the standard deviation of 16.9 days points to a somewhat inconsistent experience for suppliers, where cash flow predictability remains a challenge.

When we organise the data by distribution buckets, it becomes evident that the sector does not favour rapid payment. The largest single cohort of companies, representing 35.7% of the sample, resides in the 'Slow' category (46-60 days). Furthermore, the quartile analysis reinforces this view; the 25th percentile sits at 32 days, meaning even the better-performing quartile fails to meet a strict 30-day target. The interquartile range of 23 days suggests that payment behaviour varies significantly between the 'good' and 'struggling' payers. It is noteworthy that only 21.4% of companies are classified as 'Fast' (0-30 days), indicating that prompt payment is the exception rather than the rule amongst these businesses.

A deeper dive into the performance breakdown and outliers reveals critical risks that creditors must realise. Although the performance metrics suggest that 38.1% of volume is paid within 30 days, the company-level data shows that 10% of the sector falls into the 'Very Slow' category (61-90 days), with one critical outlier taking 95 days to settle. With late payments averaging 25.2% and nearly one-fifth (19.1%) of payments extending beyond 60 days, suppliers generally face a two-month wait for capital. Business analysts must specialise in identifying these lag indicators, as the presence of companies pushing terms to 90+ days—albeit a small 1.4% minority—signals pockets of severe liquidity stress or poor administrative governance.

Finally, the geographical distribution places the centre of activity firmly in the West Midlands, which houses 17 of the companies analysed, followed by the South East and East of England. This regional concentration may warrant further investigation to determine if local economic factors are influencing the sector's payment speed. In summary, whilst there are top performers settling in under 20 days, the Heavy equipment and machinery sector is largely defined by a 45-day payment cycle. Stakeholders should prepare for working capital gaps averaging six weeks, with a significant risk of extensions into the 60-day range.