Payment terms for New Zealand companies rose in the fourth quarter, with an increase in the number of days to pay accounts, though Dun & Bradstreet predicts and improvement through 2010.
Payment terms rose 0.3 days to 44.6 days in the fourth quarter from the previous three months, the firm
said. While time taken to pay has improved from as long as 50 days at the height of the financial crisis, it is still two weeks longer than the standard 30-day term, D&B said.
"New Zealand executives need to ensure they have a strong cash position by taking prompt action to collect their bills," said John Scott, general manager at D&B New Zealand. "If they take their eye off the ball and allow their vigilant focus to waiver, the economic recovery will falter."
Scott said 2010 "looks more promising" with further improvements in payment terms expected provided the economy's recovery continues as expected.
The agricultural sector maintained its position as the fastest payer in the final three months of 2009, taking 40.1 days to pay, down 0.8 days from the previous quarter.
Payment terms for fishing and manufacturing also improved. The slowest payer was the electrical, gas and sanitary services sector, at 52 days, 0.8 days less than in the third quarter.
The communications industry recorded the largest increase in days to pay, jumping 1.5 days to 46.8 days.
Companies in Christchurch were the fastest to pay while firms in Wellington were the slowest, according to the report. In terms of size, companies with 6-19 workers were the quickest to pay while those employing more than 500 were the slowest.
