Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Bills Paid in Record Time

MEDIA RELEASE

26 March 2014 – Immediate release

Bills Paid in Record Time
Payment times drop below 40 days

Businesses have been paying their bills at the fastest rate recorded in 10 years of commercial invoice data, with payment times across New Zealand dipping below the 40-day mark in the last quarter of 2013 to an average of 39.6 days.

The findings by credit reporting body Dun & Bradstreet underscore the healthier financial position of many companies and industries over the past year, and the relative strength of the New Zealand economy which this month became the world’s first advanced market to increase interest rates.

In comparison to Australia, where company payment times have stalled at an average of 53 days, the corporate sector in New Zealand has been able to steadily increase the rate of its invoice payments through 2013 as it benefits from strong business and consumer confidence, trade activity and investment.

Invoice payment times typically indicate the financial position of firms, and by association reflect the performance of the wider economy. When experiencing stronger sales and profitability they have a greater capacity to pay their expenses in a timely fashion. In turn, this returns finance back into circulation at a faster rate, providing a positive knock-on effect through to the entire economy.

D&B’s latest Trade Payments Analysis highlights the improved financial capacity of New Zealand companies, with findings that during the last quarter 66 per cent of invoices were paid within the standard 30-day period, an increase from 61 per cent a year earlier.

“Average invoice payment times have fallen below the 40-day mark for just the second time in the past decade, reaching a new low in the last quarter,” said Dennis Martin, Managing Director of Dun & Bradstreet New Zealand.

“These findings continue a clear and positive trend in the performance of the corporate sector, and follow additional positive movements in business and consumer confidence, the current account deficit and jobs growth.

“Our forecasts are for New Zealand’s key economic measures to continue improving this year, and consequently we also expect to see consolidation of this trend of faster business payment times,” Mr Martin added.

Across industries, the forestry sector performed the most strongly during Q4 2013, with payments by the country’s third largest export sector improving to an average of 33 days, compared to 35 days last year.

New Zealand’s substantial agriculture industry also improved the rate at which it settled its accounts, with average payment times moving to 36 days, compared to 37 days last year. The sector has benefited from strong dairy and meat product export volumes and prices during 2013, in addition to an easing of drought conditions.

While smaller operations in New Zealand have recorded faster invoice payment times, larger companies bucked the trend during Q4 2013, with average payment times slowing compared to the previous year.

Businesses employing between 200 and 499 people were one day slower to settle their accounts, while larger operations were significantly slower. D&B’s analysis shows that companies with more than 500 staff paid their invoices in an average of 45 days, up from 41 days.

“The ongoing favourable news on the New Zealand economy has shown up in a 10-year low in the time taken by firms to pay their bills,” said Stephen Koukoulas, Economics Advisor to Dun & Bradstreet.

“These findings confirm that the stronger growth that prompted the RBNZ to hike interest rates earlier this month is contributing to a more positive cash flow position for the business sector.

“Even though the RBNZ has commenced an interest rate tightening cycle, the boost to the economy from the dairy sector, construction and household spending is likely to see company payment times remain low for at least the near term,” Mr Koukoulas added.

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Science: Hookworm Discovery At Malaghan Institute

Professor Graham Le Gros has led a team which has stimulated both innate and memory responses to the parasite, discovering along the way the unexpected behaviour of one particular immune cell, in Hookworm, one of the world’s most devastating tropical ... More>>

Business: Provinces Urged To Make Full Use Of New Air Services

Provincial New Zealand has been urged to use new air services to Auckland or risk losing them either partially or completely. The stark warning was issued today by Far North mayor John Carter at a ceremony at Kaitaia airport to mark the final Air ... More>>

Mobile: 2degrees To Credit All Calls And SMS To Nepal

In the wake of the devastating earthquake in Nepal in the weekend, 2degrees will be crediting all calls and SMS messages made to mobiles and landlines in Nepal from Friday 24th April until midnight Wednesday 29th April. More>>

Scoop Business: Alex Swney Pleads Guilty To $2.5M Fraud Charge

Alex Swney, former chief executive of the Auckland city centre business association Heart of the City, has pleaded guilty to dishonestly using documents to obtain $2.5 million. More>>

ALSO:

Petrol Burns Prices: Second Consecutive Quarterly Fall For CPI

The consumers price index (CPI) fell 0.3 percent in the March 2015 quarter, following a 0.2 percent fall in the December 2014 quarter, Statistics New Zealand said today. The last time the CPI showed two consecutive quarterly falls was in the December 1998 and March 1999 quarters. More>>

ALSO:

Scoop Business: NZ Broadcasters Launch Battle Against Global Mode ISPs

New Zealand broadcasters have confirmed they’ve launched legal proceedings against internet service providers who give customers’ access to “global mode”, which allows customers access to offshore online content, claiming it breaches the local content providers’ copyright. More>>

ALSO:

Sanford: Closure Of Christchurch Mussel Processing Plant Confirmed

The decision comes after a period of consultation with the 232 staff employed at the Riccarton site, who were told on 9 April that Sanford was considering the future of mussel processing in Christchurch. Recent weather patterns had impacted on natural spat (offspring) supply... More>>

ALSO:

Price Of Cheese: Dairy Product Prices Fall To The Lowest This Year

Dairy product prices fell in the latest GlobalDairyTrade auction, hitting the lowest level in the 2015 auctions so far, as prices for milk powder and butter slid amid concern about the outlook for commodities. More>>

ALSO:

Houston, We Have An Air Route: Air New Zealand To Fly Direct To The Heart Of Texas

Air New Zealand will fly its completely refitted Boeing 777-200 aircraft between Auckland and Houston up to five times a week opening up the state of Texas as well as popular nearby tourist states such as Louisiana and Florida. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news