Late payment periods cut

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The time British firms take to pay their bills improved slightly towards the end of 2011.

But it still takes them 26 days more than the terms they have agreed with their suppliers, according to business data specialist Experian.

Britain’s large firms are the worst payers, with companies that have more than 500 employees settling their bills more than 34 days later than agreed - 10 days longer than companies with 51 to 100 employees.

Firms in the North West continued to pay their suppliers later than firms in any other region – 35.54 days after agreed terms, compared with 26.68 days in Yorkshire.

Engineering firms were amongst the worst payers, settling their bills 30.45 days later than they should, nearly four days longer than the national average.

Jason Mills, head of payment performance at Experian UK & Ireland, said: “Payment performance is the timeliest indicator of the current health of any business, so the overall improvement suggests that during the last three months of 2011, pressure on cash flow and finances was more manageable for most businesses.

“Feedback from our larger customers demonstrates awareness and understanding of the struggles faced by some of their key SME suppliers so (they) are prioritising payments to them, to better support them.”