The IT industry is a fast moving sector with new technology constantly improving potential development. However, seemingly minor issues such as slow invoice payments have the potential to slow growth.
As such, it is pleasing to report the statistics from the latest Trade Payments Analysis out of Dun & Bradstreet. According to their figures, average invoice payment times dropped to 50.4 days over the first quarter of 2015 – compared to 56 days 12 months ago.
This is seemingly a significant milestone with Dun & Bradstreet reporting that it is the fastest Q1 rate change since records were first measured in 2007. Additionally, it is even more impressive given the fact that the economy is only growing at 2.3 per cent.
Why such a change?
Dun & Bradstreet had a number of reasons for this improvement in payment times. This included lower interest rates on cash flow and the brighter outlook for the corporate sector after the recent recession.
Gareth Jones, CEO of Dun & Bradstreet in Australia & New Zealand, explained the findings in more detail.
“The lower cost of debt is certainly helping businesses to manage their repayments and control their cash flow in an operating environment of soft demand,” he said in a June 17 media statement.
“The protracted recovery since the global financial crisis has also forced businesses to become leaner and more efficient operations, with a greater flexibility in payment terms and conditions to improve the likelihood of timely payment.”
However, it isn’t all blue skies ahead for invoice payments. While they are being paid quicker, Dun & Bradstreet still believe 44 per cent are paid late – hurting the cash flow and growth potential of many businesses.
Businesses looking for assistance
With the national economy moving slowly, there is a real need for corporates to look for assistance in order to grow. According to the Bibby Cash Flow Index, 59 per cent of organisations are looking to seek general business advice. This was followed by tax information (57 per cent), superannuation (33 per cent), investments (29 per cent) and risk management (23 per cent).
It is these areas where Oncore Services can be of assistance. With a range of services including invoices, tax, compliance and expenses, our specially designed software can ensure corporates and recruiters provide excellent value to their IT contractors.
For more information on how we can help, contact our expert team today.