Military and Defence

Based on the comprehensive dataset provided, I have conducted a detailed review to analyse the payment behaviour of the Military and defence sector. This sample, comprising 10 companies primarily situated within the economic hubs of London and the South East, presents a distinct dichotomy between a generally efficient majority and a minority of critical payment risks.

Central Tendency and Distribution Skew To properly analyse the sector's financial health, one must look beyond the simple arithmetic mean. Whilst the average payment time is recorded at 38.3 days, this figure does not accurately reflect the typical behaviour of the sector due to significant skewing by outliers. A more reliable indicator of the sector's centre is the median payment time of 28 days. This disparity between the mean and the median highlights a volatile standard deviation of 32.5 days, suggesting that whilst the typical company pays promptly, the risk of encountering severe delays is non-negligible. The data indicates that companies in this sector generally favour prompt settlement, with 70.0% of the sample categorised as 'Fast' payers (0-30 days). However, credit managers must realise that the stability suggested by the median is compromised by the extreme variance found in the tail end of the distribution.

Consistency and Quartile Analysis A closer examination of the quartiles reveals a highly consolidated core of performance amongst the majority of these firms. The interquartile range (IQR) is a mere 11 days (spanning from 24 to 35 days), which demonstrates that the middle 50% of the sector operates within a very predictable window. This tight IQR suggests that most finance departments in this sector organise their ledgers efficiently, maintaining a standard 30-day payment cycle. Nevertheless, the distribution analysis highlights a 'Critical' segment, representing 10.0% of the sample, where payment times exceed 90 days. This creates a bimodal risk profile: a vendor dealing with the Military and defence sector can generally expect payment within a month, but must remain vigilant against the minority of bad actors that can severely disrupt cash flow.

Transactional Performance and Outliers When we delve into the granular breakdown of invoice performance, the data shows that 68.5% of obligations are settled within 30 days. However, a concerning statistic is that 23.8% of payments are classified as 'late'. This indicates that even amongst companies that generally pay reasonably fast, administrative friction or tactical cash preservation often pushes payments slightly beyond agreed terms. The most alarming data point is the extreme outlier: whilst the fastest payer settles in just 13 days, the slowest payer extends to a staggering 132 days. This 132-day extreme is the primary driver of the high standard deviation. For analysts specialising in credit risk, this signals that due diligence is essential; assuming a new client will adhere to the sector's 28-day median could be a costly error if they turn out to be the outlier.

Regional Concentration and Summary Geographically, the sample is heavily weighted towards the South East and London, which account for 80% of the analysed companies. This regional bias suggests that the payment culture observed here is largely reflective of practices in the UK's primary commercial centre. In summary, the Military and defence sector displays generally healthy payment habits, with a strong inclination towards settling debts within the standard commercial month. However, the presence of extreme outliers necessitates a cautious approach. Stakeholders must not become complacent due to the favourable median; instead, they should rigorously vet new partners to ensure they do not fall victim to the minority of firms exhibiting critical payment delays.