A Quarterly Report for Benchmarking A/R Performance
Q4 2021 Report
Dun & Bradstreet and the Credit Research Foundation's U.S. Accounts Receivable and Days Sales Outstanding Industry Report suggests that industries overall are showing strong resilience and recovery from the impact of the coronavirus pandemic – at least from the companies that submit A/R data to Dun & Bradstreet and the CRF.
The Q4 2021 report shows that 19 of the 223 industry segments report more than 10% of their aging dollars are 90+ days past due. This is lower than Q4 2020, when more than 25 industry segments reported more than 10% of their aging dollars were severely delinquent.
“The data indicates continued progress for economic recovery. While some industries are still reporting significant slowness and payment delinquency, there are industry segments exhibiting signs of growth, such as their accounts receivable performance," William F. Balduino, President and COO of the Credit Research Foundation, said.
Balduino advises business credit professionals to use this quarterly report to benchmark their company's A/R performance against industry averages and investigate the differences. Although differences could be driven by unique company portfolios, using credit best practices plays an important part in driving A/R performance.
“Hence the importance of a full portfolio analysis which allows credit risk management teams to properly assess and apply appropriate strategies across their customer base,” Balduino said.
The Q4 2021 report lists industries by SIC code, along with the percentage of Dun & Bradstreet reporting companies that are current on payments, then slow to 30 days late, slow to 60 days late, slow to 90 days late, and then severely delinquent at 91+ days late (for more information, see Methodology below). The Q4 2021 report data is presented in 15 different industry segments: Agriculture; Business and Professional Services; Chemicals; Construction; Consumer Goods; Energy and Utilities; Food; Machinery; Manufacturing; Metals and Mining; Retail; Technology and Electronics; Transportation; Wholesale; and Wood and Paper.
Highlights of the Q4 report show that companies in the publishing industry and the construction industry report to Dun & Bradstreet that more than a third of their accounts receivable dollars are paid severely delinquent. Companies in the oil and gas machinery manufacturing industry, as well as certain types of wholesales (such as medical/hospital equipment and frozen goods) and other manufacturers, report more past due dollars. However, note that many of those industries reporting more than 10% of their dollars severely delinquent still have the majority of their dollars current.
As a preview of the data available, the chart below shows the top 15 industries that paid more than 90 days late during Q4, October 1– December 31.
Top 15 Industries Getting Paid Severely Late in Q4 2021
|SIC Code||Industry||% Paying Current||Up To 30 Days Late||30-60 Days Late||60-90 Days Late||91+ Days Late|
||Construction - general contractors & operative builders||51.2%
||Manufacturing - oil/gas field machinery
||Manufacturing electrical equipment/supplies
|5047||Wholesale medical/hospital equipment
|5142||Wholesale packaged frozen goods||66.6%
||Miscellaneous repair services
||Manufacturing - sheet metalwork||73.4%
|3069||Manufacturing fabricated rubber products
|7514||Passenger car rental||51.4%
||Help supply services||62.9%
This joint report expands upon the Credit Research Foundation's own quarterly report, the National Summary of Domestic Trade Receivables (NSDTR), by providing aging A/R percentages on more industry segments. Dun & Bradstreet’s aging A/R data is supplied by contributors to the Global Trade Exchange Program, its commercial trade data network. Contributors report their trade payment information to help strengthen reporting of trade credit experiences. The DSO numbers are those collected by CRF from its NSDTR survey process. Dun & Bradstreet’s aging A/R data and CRF’s DSO numbers are presented side by side for an industry. Both sets of data are presented when the numbers of providers and survey results meet a minimum threshold of relevance.