Management and Strategy Consultancy

Payment Behaviour Analysis: Management and strategy consultancy Sector

Upon analysing the payment data for the Management and strategy consultancy sector, comprising a sample size of 35 companies, a distinct profile of payment behaviour emerges. The sector demonstrates a relatively healthy payment culture, characterised by a median payment time of 28 days. This figure is notably lower than the average (mean) payment time of 32.9 days, indicating a positive skew in the data. This discrepancy suggests that whilst the majority of businesses settle their invoices promptly, a minority of slower payers are dragging the average upwards. The standard deviation of 18.5 days further highlights this volatility, signalling that suppliers should realise that payment experiences can vary significantly between different entities within this industry.

A detailed examination of the distribution reveals that the sector heavily favours prompt settlement. Sixty per cent of the analysed companies fall within the 'Fast' category (0-30 days), and the 25th percentile sits at an impressive 22 days. This demonstrates that for the top quartile of performers, operational efficiency regarding accounts payable is a priority. Furthermore, with an interquartile range of 20 days (spanning from 22 to 42 days), the central 50 per cent of the market operates within a predictable window. However, suppliers must remain vigilant; whilst 69.4% of invoices are paid within 30 days, the data indicates that 25.9% of payments are classified as late. This suggests that credit control teams must remain active to ensure invoices do not drift beyond agreed terms.

The analysis highlights a "tail" of poor performance that warrants caution. Whilst the fastest payer settles in just 2 days, the slowest payer takes 96 days—a critical delay that could jeopardise cash flow for smaller suppliers. The distribution data shows that nearly 9% of companies take longer than 45 days to pay, with one specific outlier falling into the critical 90+ day category. Consequently, when engaging with new clients in this sector, it is advisable to credit-check prospective partners to determine whether they sit amongst the efficient majority or the sluggish minority.

Geographically, the sample is heavily centred on London and the South East, which account for 30 of the 35 companies analysed. This regional concentration suggests that the payment behaviour observed is largely reflective of the capital's economic climate. In summary, the Management and strategy consultancy sector presents a generally low-risk profile for credit managers, provided they organise their collection processes effectively to manage the 25.9% of late payments. By focusing efforts on the minority of companies that exhibit slow payment behaviour, suppliers can mitigate the risks associated with the standard deviation and outlier delays observed in this dataset.