It’s often easy to get wrapped up in the buy-side of the purchasing equation, acting as we do for the purchaser most of the time. However, it’s critical to remember that there are two sides to every trading relationship and the procurement solutions we put in place are designed to deliver benefit to supplier too. Often one of the key benefits revolves around process efficiencies that deliver big reductions in stopped and blocked invoices, ensuring that suppliers get paid more quickly and with fewer costly manual interventions.
However, whilst a joined up eProcurement or purchase-to-pay solution can bring major process efficiencies to bear, it isn’t always the case that the benefits are passed on to the supply chain and the Institute of Credit Management have recently published a league table charting the time every single UK public limited company takes to pay its bills – see the FT article here for full details.
At the top of the tree companies like easyJet and Northumbrian Water score well, with payment in under 10 days, but the worst offender by far is United Utilities, where suppliers have to wait an average of 99 days for their bills to be paid. Of the 350 large and medium-size companies listed on the FTSE 100 and FTSE 250, Aga Foodservice Group, the manufacturer, was shown to take 81 days on average to pay invoices, while Carillion, the construction company, takes 80 days. Some of the slowest payers, among Britain’s 11,000 plcs, take more than a year to pay bills!
