- Well known companies including Tui, Diageo, Coca Cola and Rolls Royce are amongst the slowest in the FTSE 350 to pay their small suppliers
- Companies currently take an average of 37 days to pay, with the slowest taking more than 4 months to settle bills
- The Good Business Pays campaign is calling on big companies to fast track payments and re-evaluate their payment terms
1st September, London: Good Business Pays has revealed the FTSE 350 companies with the slowest payment practices. Analysis of the latest information submitted under the Duty to Report Regulations to the government shows well-known companies such as Diageo, Coca Cola and Rolls Royce are amongst the ten slowest to settle invoices with their suppliers.
Analysis reveals aerospace manufacturer Meggitt is currently the slowest to pay, taking on average 132 days to settle suppliers and failing to pay 85 percent of invoices within agreed contract terms. The C&C Group, the drinks manufacturer that produces Bulmers and Magners, follows at 120 days and travel operator TUI at 101 days.
The full data shows the slowest 10 slowest large companies, are:
|Company||Average time to pay in days||% Invoices not paid within agreed terms|
|C&C Group plc||120||53|
|Coca-Cola HBC AG||83||8|
|Greencore Group plc||79||11|
|Premier Foods plc||76||2|
|Rolls-Royce Holdings plc||76||8|
The data also shows FTSE 350 companies are taking on average 37 days to pay small suppliers, a week later than the 30-day target set by the Prompt Payment Code.
Despite many FTSE 350 companies taking months to pay suppliers, the analysis undertaken by Good Business Pays reveals only a quarter (24%) of large companies say they are not paying within their agreed payment terms. Although 76% report paying on time, many of these use lengthy and unfair terms within their standard contracts. It also masks the role of trade credit in enabling customers to pay suppliers even later than their agreed terms, further exacerbating the problem of late payment.
There is clear evidence slow payment has a negative impact on small businesses. In fact, the Federation of Small Businesses estimates 50,000 go under each year because of late-paying clients.
The Good Business Pays campaign is calling on FTSE leaders to speed up their payment practices and re-evaluate their standard terms to ensure their smaller suppliers are being paid when they need it the most.
Whilst disappointing, today’s data is unsurprising. Many of these large companies claim to be responsible, but they’re failing to do the basics such as complying with the Prompt Payment Code, which is in place to protect small businesses. We’d like to see FTSE leaders, and their stakeholders such as investors, make responsible payment practices a bigger priority.
“I was very encouraged to see GlaxoSmithKline recently sign up to the Prompt Payment Code recently, and as a result I expect we’ll see a vast improvement in their payment practice over the next 12 months. Making moves to pay invoices faster has also never been easier; with technology enabled systems available to help businesses pay quickly, reduce risk, increase efficiency and save cost. In September, we’ll be launching an accreditation programme to recognise big businesses improving their payment practices to support their small suppliers.Terry Corby, Chair of the Good Business Pays campaign
Backed by Federation of Small Businesses, the CBI, manufacturers group Make UK, the BCC, IoD and the Creative Industries Federation, the Good Business Pays movement was launched in May 2021 to encourage the UK’s largest companies to fast track payments to small suppliers, helping them bounce back and inject vital capital into the economy.