The final 2 takeaways from our Perceptions Deep Dive Study continue the focus on how customer payment is influenced by a supplier’s industry, revenue and invoice volume.
Takeaway #5: The lower the invoice volume and annual revenue, the greater chance of having most of your invoices paid within 30 days.
Larger companies and those that send more invoices tend to have a longer average DSO than smaller companies and those that send fewer invoices. For example, 67% of companies with less than $5 million in revenue have an average DSO of 30 days or less while 55% of companies with revenues over $1 billion tend to have an average DSO of 30 days or less.
This may be a result of larger organizations simply having greater working capital and increased flexibility regarding cash flow. Smaller organizations may seek faster payment due to a lack of flexibility exhibited by larger organizations.
Takeaway #6: The smaller an organization, the more likely they are to have remittance data from customers sent with a paper check.
Receiving remittance data via paper check and email decreases steadily as company revenue increases. For companies with less than $5 million in revenue, 69% receive remittance data via paper check and 44% receive it via email. For companies with over $1 billion in revenue, 56% receive remittance data with a paper check and only 33% receive it via email.
Concurrently, for companies with less than $5 million in revenue, 5% receive remittance data through a customer portal while companies with more than $1 billion in revenue receive remittance data via a customer portal at a rate of 38%.
See these and other findings in the 2015-16 Perceptions Deep Dive: A definitive benchmarking guide for payment and remittance published this week.