Tips & Advice for
Leveraging Business Data

What Kind of Credit Risk Professional Are You? NACM Credit Congress Attendees Survey Results

May 24th, 2013 by Shannon Rentner

Most occupations have their own stereotype – think of the accountant [Angela from The Office], the brainy but beautiful homicide detective [Kate Beckett in Castle] or the savvy, debonair advertising exec [Don Draper in Mad Men]. What’s the stereotype for the Credit Risk Professional?

We came up with two: the relational, affable, but more traditional Shay Cands[Shake Hands]  and the more serious, data-driven, innovator Anita Ansa

[I need an answer!].

Which one did the NACM Credit Congress attendees identify with more? Anita Ansa. In fact, the data-driven approach to managing credit/risk beat out the traditional approach 2:1. We don’t want to speculate as to what this means,  but with the squeeze on credit managers to do more with less combined with new technologies and better data sources, the profession may be turning a corner when it comes to assessing risk. Where do you fit? See the InfoGraphic here.

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The B2B Sales Dilemma: Go Digital or Go to Dinner?

May 16th, 2013 by Shannon Rentner

Knowledge is power – especially when it comes to self-educating before making a purchase: 88% of consumers research before they buy – reviewing an average of 10.4 sources. From purchasing a digital camera to choosing a new restaurant, we self educate – through basic online search to visiting review sites to social media. Gone the way of the dodo is the consumer who walks into the Apple store to begin his search for a new laptop without having first done his own online research.

We in the B2B world like to think that because the sale is often more complex, entails a longer sales cycle and is generally more practical, our buyers are different than consumers  and they’ll  consult with a sales person earlier in the buying cycle.

The reality is that even B2B buyers are self-educating by consulting a significant number of resources before they ever speak to a salesperson. In fact, according to a recent survey by DemandGen Report, 77% of B2B buyers do not talk with a salesperson until after they have self-educated – and even more interesting – 36% of buyers reported that they didn’t engage with a sales rep until after they had developed a vendor short list.

What does that mean for today’s B2B sales professional? In the past the top performing sales professionals had their list of closely guarded connections in specific industry verticals – where they had demonstrated their industry expertise by closing business. Their tools for selling: hand-written notes stacked in a manila folder, big expense accounts for wining and dining, and a golf membership. Has the digital age changed all that? Considering that the average company tenure of a US-based employee is about 4 years – the question naturally arises – how long will those connections to target companies be of any use?

A recent B2B sales and marketing conference broached this topic on how the buying cycle has change – and its impact on the B2B sales professional: how should they spend their time and budget – dinner or digital?

It’s a blend of both. B2B Sales people need to engage and educate buyers digitally – and then build the relationship over dinner. At the end of the day, people like doing business with…well…people they like – so dinner is still a weapon in the salesperson’s arsenal. With the focus on self-education and the importance of targeting the right companies to begin with, B2B sales professionals need to strike a balance.

Here’s four tips for adding digital tools and technologies to the mix:

  1. Find the right targets. Like consumers, companies change gears and priorities – constantly. At the same time, employees at all levels come and go – so leverage the best online, automated data sources available to find prospects that have a high propensity to buy what you sell. This step dramatically improves productivity, shortens the sales cycle and leads to better closure rates.
  2. Ensure your marketing team is generating quality, informative content to push through digital channels – including the website, email, online advertising and social channels. If buyers are self-educating, make sure they’re getting educated about you!
  3. Get social – make connections in LinkedIn, Twitter and Facebook – then establish yourself as an expert in order to help educate prospects by sharing content via Twitter, Facebook and engaging in group discussions on LinkedIn.
  4. Stay up-to-date on the latest digital tools – many are free and will help you remain productive, engaged and hopefully – successful. Here’s an article that can get you started: 10 Little Known Apps That Entrepreneurs Can’t Live Without.

Knowledge is power not just for the buyer – but also for the sales professional.  So when it comes to going digital or going to dinner, choose a little bit of both.

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Solving the Credit Risk Dilemma: When Traditional Credit Data Isn’t Enough

May 9th, 2013 by Shannon Rentner

To  extend or not to extend?  That is the question – at least when it comes to credit. It’s an even more important question now – in today’s uncertain economy as companies are getting ‘back to business’ – buying and selling. The pressure is on credit and risk professionals to make the right call.

Unfortunately, traditional credit data – based on a company’s payment behavior – is a lagging indicator of a company’s financial health and overall credit worthiness. In fact, more often than not, it tells you what you already know. Purchase behavior, on the other hand, is a leading indicator of a company’s financial health. What a company is buying, how much it’s spending and when it’s making those purchases reveals a pattern of behavior that provides much deeper insight into the financial health of a company.

Check out the latest eBook, Business Behavior Insights: Where to Turn When Traditional Credit Data Isn’t Enough, to learn more about how credit and risk professionals are leveraging business behavior data to gain a clearer view of a company’s financial health.

In this eBook you’ll discover:

  • The advantages of B2B purchase behavior vs. traditional credit data
  • Why B2B purchase behavior is a leading indicator of a company’s financial well-being
  • How to get B2B purchase behavior insights

 

Get a sharp and timely view into what customers and prospects buy and how their buying patterns change over time to obtain a powerful new measure of a company’s financial health.

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The New Rules of Sales Prospecting: A Guide to Using Business Behavior Data & Insights [Webinar Replay]

May 1st, 2013 by Shannon Rentner

Gary Brooks, CMO, Cortera and John Tusa, SVP Sales, Cortera

 

Why is B2B Sales Prospecting so difficult? Whether you’re an SMB or Fortune 1000 sales professional, finding the right company at the right time with the right message and right offer seems nearly impossible. And often sales closure rates show it.

Check out this recorded webinar to learn the latest on how to leverage advanced sales intelligence to find the prospects with the highest propensity to buy your products and services.

In this webinar, you will learn:

  • Why B2B Sales Prospecting is still so difficult – a look into the data
  • How to find focus on companies with the highest propensity to buy what you’re selling
  • What is Business Behavior Profiling and how it can be used to identify lookalike companies
  • Why this approach will alleviate the stress associated with prospecting
  • Who is Cortera
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3 Ways Credit Pros Can Become Sales Heroes

April 8th, 2013 by Jeff Braunstein, VP, Strategic Channels, Cortera


Reduce Risk and Drive Revenue:  The former may be the goal for the credit department, but the latter is the goal of any business. Armed with the right data, credit and risk professionals can change the game by not only reducing risk, but also contributing to the sales effort.

So what’s the hold up?

Businesses have long relied on conventional credit data to evaluate the risk of potential and existing customers. This data has been the sole source for determining the financial solvency of prospects. However, credit and risk professionals now have access to data that reveals not just how a company pays – yielding a credit score – but how it behaves across multiple dimensions. Like consumers, businesses aren’t static and are defined by behaviors – how it pays, what it buys, how it invests, who it hires and fires, how it conducts business across multiple categories captured in news, blogs and other social media – as opposed to demographics or credit history alone. With a 360˚view into these behaviors – or business life events – credit and risk professionals can now not only better determine where the risks are – and avoid them – but also identify opportunities to upsell to existing customers – or find completely new sales opportunities.

Drive New Sales

A first step in selling more is seeing more, i.e. to have a better handle on a prospect’s behavior early on in the sales process – often before a sales call is even made. Business behavior insights provide organizations with a more robust view of a company’s financial health. The details and trends revealed in a customer or prospect’s spending areas can adequately tell if that company is growing or failing, expanding or downsizing, or in status quo health. From that information, companies can connect the dots and prepare for their next move. In sum, this gives companies a clearer, more accurate picture on which to base important decisions.

Perhaps more importantly, having a behavioral profile of your existing accounts can help you determine what types of companies you should be actively pursuing – the ones that look and act like your existing customers and have a propensity to buy your products and services. This will help you guide sales to targets that promise to be more profitable in the long terms and a shorter sales cycle the short term.

Find Ripe Upsell Opportunities

An existing customer is 45% more profitable than a brand new one, according to recent survey by InsideView. You not only want to retain them, but you also want to sell them more stuff. So actively monitoring the business behavior of existing customers will show you timely upsell opportunities – are they increasing their spend in shipping? Transportation? Has their spend in business services suddenly increased – perhaps signaling the opening of a new plant/office? Letting your sales team know about these sudden positive shifts in behavior can empower you to become a key sales resource and growth driver.

Better Risk Reduction: Leading vs. Trailing indicators

Another benefit of business behavior data is its ability to signal a company’s demise before traditional credit reporting systems. For example, one company recently announced closing its factory doors. Stand-alone conventional credit scoring gave creditors no inkling of the company’s collapse. In fact, the company’s credit ratings had consistently portrayed solid credit-worthy performance for years, and there was nothing revealed from the company’s public-facing information to signal any areas of weakness. This gave suppliers a false sense of confidence and led them to continue extending credit to the company that was about to close its doors.

By itself, the credit data did not paint a complete picture. However, behavior data raised three major red flags within the failing company. First, there was a decline in materials spend. A sudden drop in materials purchases can indicate an anticipated drop in manufacturing volume due to weak sales or declining orders.

The company also showed a decline in shipping expenditures. Seeing the trend in regard to shipping expenditures over a period of three to five years can demonstrably illustrate a company’s financial health or expose any glaring vulnerabilities. A drop in shipping can translate into a reduction in manufacturing output, weak sales, or both.

The third red flag identified was a decline in operations spend. Every business requires a broad variety of products and services to support normal business operations, from paper clips to printer cartridges to computer maintenance. A drop in this area represents a slowing of business, efforts to conserve cash, or both.

Traditional data for risk decisions is based on payment decisions. However, users of behavioral insights do not assign a customer or prospect to a single, overall score. Instead, these behavior-based insights provide a wealth of clues, which can be used to predict future behavior.

Like many positions within today’s organizations, the role of credit managers and financial executives is evolving with a deeper emphasis on providing other departments – like sales – with information to help them improve their pipelines and close deals. Credit data continues to serve a purpose – but acquiring deeper insights from business behavior data not only helps credit and risk professionals avoid risk, but also equips them to be sales champions as well – a win-win for the individual, the department and the company as a whole.

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4 Reasons Why B2B Sales Prospecting Sucks
And How to Make it Suck Less

April 2nd, 2013 by Shannon Rentner

1. It’s a Time Killer:

Sales people burn more than 200 hours per year searching for information on prospects and which companies to target. That’s 5 whole weeks, WASTED.

2. Too Much Information:

With all the hype around Big Data and how it’s supposed to drive revenue, increase efficiency and deliver unprecedented competitive advantage, why are B2B Sales and Marketing departments left with 2nd rate demographic data for targeting sales prospects? That’s just information overload.

3. The Wrong Prospects:

Bad data is bad data – more of it won’t help but only serves to multiply our poor choices. Talk about trying to find a needle in a needlestack.

4. Skyrocketing Costs:

Technology and innovation is all about cost-savings and efficiency. But the wrong data for targeting sales prospects also translates into missed opportunities. It’s hard not to dwell on all the SALES that didn’t happen – what’s the cost of that?

Scroll down to see how to make sales prospecting suck less.

Lookalikes

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Making ‘Big Data’ Small…and Usable

March 28th, 2013 by Gary Brooks, CMO, Cortera

How to use mountains of “big data’ to improve sales targeting

The slogan “It’s not complicated – more is better than less” might work well in entertaining AT&T television ads where children express their desire for wanting “more, more, more,” but when it comes to data, it is complicated and more isn’t always better. In fact, there are three times more bits of information in our current digital universe than there are stars in the galaxy. But more isn’t necessarily better. An IDC study (cited by CFO.com) reports that “only about 3% of that universe’s potentially useful information has been identified, and even less has been analyzed. Which means 97% of the world’s stored information is basically worthless.”

Without focus, precision and automated processes to convert even the business-related data that’s available into actionable insights, the ‘Big Data’ avalanche will continue to bury sales and marketing professionals under a mountain of irrelevant and useless data and leave them struggling with a very old problem—figuring out which companies to target. The demographic or firmographic data used for targeting leaves them with sales blinders, leading to wasted time, resources and missed opportunities, but at the same time, as great as web-based research has become as a sales prospecting tool, “the core competencies of B2B salespeople – communicating, convincing, and closing” – may be somewhat enhanced, but more likely, sales people are continuing to be overwhelmed by the sheer volume of irrelevant information and data.i On average, according to a recent Aberdeen Report, Sales Intelligence: What B2B Sellers Need to Know Before the Call,” salespeople in companies surveyed spent the equivalent of 200 hours per year in non-productive time searching for customer data. That’s five weeks of unproductive time.

There has to be a better way.

Business Behavior Data and Insights Deliver Results

A growing number of forward-thinking B2B sales and marketing overachievers have taken a page from the B2C marketing playbook to use business behavior data and profiles—what companies buy, how they pay, where they invest, who they hire, etc. – to determine which companies to target. Businesses, after all, behave like people. And smart B2C marketers know that consumer needs can be predicted based on behaviors – things like life events. If a consumer purchases a mini-van and a crib, retailers should start sending coupons for diapers. Businesses, too, have life events and other “triggers” because they are “multi-dimensional, dynamic entities” that constantly shape-shift. When a B2B sales force has access to this behavior data, not only does overall company revenue increase, but so, too, does customer retention and sales rep efficiency.ii

However, hiring a team of data scientists or data analysts isn’t the answer – automation is.

Imagine a system that automatically generates prospects – that look and act like your existing customers. That’s the basis of Cortera Lookalikes™. No more sifting through infinite lists of prospects based on inaccurate, static and incomplete SIC/NAICS codes, number of employees, annual sales revenue or spending hour manually searching the web and social media for the latest company news. Cortera does it for you. First, it generates a Behavior-based profile of your existing customers. Next, it uses that to identify lookalike companies in a database of more than 20 million companies. These prospects are then delivered directly to you. Unlike other data sources, the Cortera database is continuously updated with the most recent changes in company behavior.

Companies of all sizes, across diverse industries are using Business Behavior Data and Insights to:

  • Finally figure out which companies to target
  • Develop highly relevant offers and messages
  • Improve marketing conversion rates
  • Drive revenue through the roof
  • Reduce cost of new customer acquisition

View the new Lookalikes eBook to learn how you can make big data small enough to improve your sales targeting.

i Ostrow, Peter. “Yesterday and Today: How Contemporary Sales Intelligence Users Earn Best-in-Class Results,” AberdeenGroup. 18 Dec. 2012. < http://aberdeen.com/Aberdeen-Library/8290/RB-sales-intelligence-enablement.aspx>

ii “Ostrow, Peter. “Yesterday and Today: How Contemporary Sales Intelligence Users Earn Best-in-Class Results,” AberdeenGroup. 18 Dec. 2012. < http://aberdeen.com/Aberdeen-Library/8290/RB-sales-intelligence-enablement.aspx>

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B2B Sales Prospecting and Target Marketing: Drift Netting or Fly Fishing?

March 19th, 2013 by Shannon Rentner

Face it. B2B target marketing is like drift netting. Drift netting is a commercial fishing practice that floats nets across the water to catch massive amounts of fish all at the same time. Because the nets aren’t species specific and are cast over a wide area, you may catch a lot of fish, but also by-catch, other species that you pick up – but don’t want.

So it is for B2B sales reps and marketers who are trying to target qualified prospects. Equipped with only SIC and NAICS codes, generic industry categories, guesstimates at revenue and number of employees for private companies, we are forced to cast a wide net – picking up targets that we don’t really want. And manually picking through the leads is a time-consuming, discouraging and ineffective process because even then, do we really have insight into which companies have the propensity to buy our products and services?

 

So marketers go through the same drift netting routine:

  • buy a prospect list
  • launch a campaign
  • cross our fingers
  • send mediocre leads to sales
  • see dismal conversion rates
  • try to convince sales the leads are good
  • repeat
  • find another company to fish for

B2C marketers, on the other hand, are like fly-fisherman. Equipped with extensive knowledge into the behavior patterns of fish, they use sophisticated flies that mimic the insects the target fish feed on. They know the right time of day to pursue the fish, and where to go on the water to find them. A VERY targeted approach to finding the prize fish.

B2C marketers evolved decades ago from using demographic data [casting a wide net]  to targeting consumers based on behavioral data because how we act reveals what we want and can often predict what we’ll buy in the future. Much more like fly-fishing.

 

So why are B2B marketers still stuck drift netting?

With all the data that’s now available – as well as the analytics to capture it – it’s time the B2B world caught up. While we’re not stuck scanning the yellow pages or “People on the Move” section of the business journal anymore, the demographic or firmographic data that we do use only defines what a business is, not how a company behaves. To better engage with our customers and prospects, improve efficiency, and drive more sales in a shorter period of time, we need insight in business behavior – not just what a company is, but also what companies buy, how they pay, how they invest, who they hire, public records, news, blogs, etc. The ability to predict how a company will act based on behavior will become a significant competitive advantage.

 

Introducing Lookalikes – a smarter approach to target marketing

The concept behind lookalikes is to take the guesswork out of prospecting by enabling B2B sales and marketing  to evolve beyond basic demographic customer profiles and use this business behavior to find companies that not only look like, but act like your current customers—the ones with a high propensity to buy your products and services. Instead of just casting a wide net, Lookalikes targets only those companies that look and ACT like your existing customers.

The first step is to capture and analyze the progression of your existing customers’ behaviors in order to generate a Business Behavior Profile—a detailed model of how your current customers look and act. This behavior-profile is then used to search the Cortera database of 20 million companies for lookalike companies and delivers a list of prospects that look and act like your existing customers.

With this intelligence, you can determine the right message with the right offer at the right time to the most qualified prospect – significantly boosting your ability to win new business.

Learn more about how Cortera Lookalikes™ is changing the game for B2B sales and marketing by checking out this eBook.

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How CFOs Use B2B Purchase Behavior Data to Increase Revenue and Reduce Risk [Webinar Replay]

March 11th, 2013 by Shannon Rentner

Jim Swift, CEO, Cortera

Traditional data does not provide sufficient insight into the financial health of your customers or prospects – it serves as a lagging indicator. Business behavior – what companies buy, and how that behavior changes over time – is a leading indicator of a company’s overall financial health. Learn how how business behavior insights was used to predict the demise of Mayville Products Corp. 12-months before the company closed its doors and how a Global 3PL is using behavior data to increase annual revenue 10%.

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How Thoreau Helped Me Find My Next Marketing Job

March 1st, 2013 by Shannon Rentner

Thoreau wasn’t thinking about B2B marketing when he said, “Simplify, Simplify, Simplify!  …let your affairs be as two or three, and not a hundred or a thousand; instead of a million count half a dozen, and keep your accounts on your thumb-nail.”

But his words ring true when it comes to vetting prospects for sales.

Why B2B Prospecting Sucks

For better or worse, when it comes to identifying prospects, there’s a lot to choose from – even after completing market sizing and segmentation using NAICS codes. What’s a marketer to do? Such was the case with a client I was working with to develop a lead gen program. The goal was to generate  warm leads for sales to follow up on.  What I found was that within just one smaller segment, there were almost 1,000 companies that met our criteria. In total, more than 10,000 companies.

Sure, I could scrap that and go buy a pre-existing list, but even then, the data is usually unreliable and mostly based on demographics – giving me a one-dimensional  view – which I already had.

Shannon, why don’t you just prioritize this list according to which companies have budget and are actively spending in our product category, said the VP of Sales. Brilliant! Talk about qualifying! That would cut the list down significantly – and increase the odds of converting those leads into actual opportunities.

What’s Missing

The problem was:  I needed better data than what was currently available. I needed insight that would help me understand what a company was doing, or was likely to do, rather than what a company is. What I needed was a LinkedIn-type database – not for contacts – but for continuously updated business behavior insights.  Who’s increasing spend in shipping? Who’s decreasing payments in raw materials? How about business operations? Technology spend? Hiring? Investing?

Then automatically report to me: Who are my top prospects?

So  it came as no surprise to me  that “combining data from multiple sources to draw correlations and make predictions”  is the goal of 39% of the 1,260 marketers surveyed as part of MarketingSherpa’s 2013 Marketing Analytics Benchmark Report. Acting on that data is the goal of 66% of marketers surveyed.

We could hire some interns to do some research, make some calls, collect data and crunch it for insight. Or I found a market research company who could do some research, make some calls, give some introductions. Then there was the cousin of a friend of a colleague who knew a guy who has a lot of connections in that industry who would make some calls – and he’d give us a deal – being family and all.

Simplify with Better Data, Better Insights

With all the hype around Big Data, I thought, surely someone somewhere had an automated approach to this.  Monitoring and studying consumer behavior has been practiced by B2C marketers for decades.  Retail companies do it. Credit card companies do it. Insurance companies do it. Why doesn’t somebody help B2B marketing and sales leverage multiple sources of data for delivering highly qualified leads?

Imagine my surprise when I talked with my friend and former colleague, Gary Brooks, who had recently  joined company called Cortera.  The more I learned about the company, the more I realized they had solved my problem. Taking a page from the B2C marketing playbook for B2B, Cortera combines behavioral data—how companies buy, pay, hire, invest and conduct business—with traditional demographic data to provide never-before-available insights on my current and prospective customers.   Armed with hard-to-find behavior data, Cortera models the behavior of my top customers, creates a behavior-based buyer persona, searches its database of 20 million companies to find prospects that behave and look like my ideal customers – and automatically delivers them to me.  Now, I have the THE target list I need to dramatically improve my marketing conversion rates.

It’s the kind of approach that helps me “Simplify!” – and dramatically improve – prospecting and lead gen. In fact, I was so impressed with this approach to “data-as-a-service” for B2B finance, sales and marketing that I joined the company’s marketing team – call me “Chief Evangelist” – for I’m a believer.

@shannonrentner

Senior Manager, Marketing, @Cortera

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New Mexico Businesses Tops in Late Payments, Hawaii a Close Second

September 19th, 2011 by

New Mexico businesses on average are the slowest at paying their invoices in the nation. According to Cortera’s monthly report on businesses accounts receivable debt past due by state for July 2011, New Mexico businesses are 23.16% past due making them the slowest in the country. New Mexico businesses have been in the top 5 slowest payers group for all of 2011. Alaska tops the most current list at only 7.15% past due – a position it has held for over a year. The top 10 lists are below.

Top 10 States with the most amount of businesses accounts receivable debt past due (July 2011)

State % Business A/R Debt Past Due
New Mexico 23.16%
Hawaii 23.11%
Florida 22.85%
Wisconsin 22.62%
Colorado 22.05%
Washington 21.60%
Missouri 20.98%
Oregon 20.92%
Minnesota 20.42%
Connecticut 20.32%

Top 10 States with the least amount of businesses accounts receivable debt past due (July 2011)

State % Business A/R Debt Past Due
Alaska 7.16%
West Virginia 9.38%
Utah 9.98%
Kentucky 10.65%
North Dakota 10.81%
Maryland 11.57%
Pennsylvania 12.31%
Rhode Island 12.85%
Ohio 13.06%
Virginia 13.22%

The Cortera Past Due by State Report tracks late payments of businesses within each state against agreed upon terms, measuring the percentage of late accounts receivable by state. This monthly report of accounts receivable (A/R) activities by state measures the payment activities of approximately 20 million public and private business locations.

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Latest Cortera Supply Chain Index Steady Near Historic Lows

September 13th, 2011 by

We just released our July 2011 Supply Chain Index (SCI) report, a monthly index of accounts receivable (A/R) activities covering manufacturers, distributors & wholesalers, retailers, services, and transportation companies. Measuring payment activities of approximately 200,000 businesses, the July 2011 SCI registered 6.16 days beyond terms (DBT), remaining near its record low of 5.05 in May 2011. The latest numbers show that US businesses continue to pay their invoices in a timely manner – the best we’ve seen since the index was introduced in April 2007.

Businesses are currently paying their bills fast in part because they are confident they will continue to get paid equally fast by their existing customers. However, they don’t appear to be investing aggressively because of mixed economic news and fears over another recession. Overall a conservative, wait and see approach to their working capital management.




A three year view of the Cortera Supply Chain Index and other industry data and figures are available on Cortera’s Market Trends website.

Media Inquiries: please contact Alex Coté at 857-403-1370.

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Florida Businesses Tops in Late Payments for Second Straight Month

December 10th, 2010 by

For the second straight month Florida businesses on average are the slowest at paying their invoices in the nation. According to Cortera’s monthly report on businesses accounts receivable debt past due by state for October 2010, Florida businesses are 24.21% past due making them the slowest in the country.  On a positive note, Alaska tops the most current list at only 6.51% past due – the only state below 10% past due.  The top 10 lists are below.

Top 10 States with the most amount of businesses accounts receivable debt past due (October 2010)

State % Business A/R Debt Past Due
Florida 24.21%
New Mexico 22.45%
Minnesota 22.44%
Oregon 22.30%
Illinois 22.04%
Hawaii 22.00%
Oklahoma 21.87%
Georgia 21.70%
Indiana 21.49%
Wisconsin 21.20%

Top 10 States with the least amount of businesses accounts receivable debt past due (October 2010)

State % Business A/R Debt Past Due
Alaska 6.51%
Wyoming 10.52%
Utah 10.53%
Maine 10.56%
South Dakota 11.40%
Louisiana 11.70%
New Hampshire 11.94%
North Dakota 12.71%
Mississippi 13.41%
Vermont 14.05%

The Cortera Past Due by State Report tracks late payments of businesses within each state against agreed upon terms, measuring the percentage of late accounts receivable by state. This monthly report of accounts receivable (A/R) activities by state measures the payment activities of approximately 20 million public and private business locations.

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Florida on Top of Business Late Payments by State, Michigan a Close Number Two

November 19th, 2010 by

It’s not exactly the title you want to win, but Florida businesses on average are the slowest at paying their invoices in the nation. According to Cortera’s monthly report on businesses accounts receivable debt past due by state for September 2010, Florida businesses are 23.91% past due making them the slowest in the country. Michigan came in number two at 23%. On the bright side, businesses in states like Alaska, Wyoming and Maine remain below 10% past due. The top 10 lists are below.

Top 10 States with the most amount of businesses accounts receivable debt past due (September 2010)

State % Business A/R Debt Past Due
Florida 23.91%
Michigan 23.00%
Oregon 22.48%
Minnesota 22.41%
Illinois 21.75%
New Mexico 21.75%
Hawaii 21.54%
Indiana 21.19%
Washington 21.00%
Georgia 20.81%

Top 10 States with the least amount of businesses accounts receivable debt past due (September 2010)

State % Business A/R Debt Past Due
Alaska 6.90%
Wyoming 9.92%
Maine 9.93%
South Dakota 10.87%
Utah 10.92%
North Dakota 10.96%
Louisiana 11.23%
New Hampshire 11.88%
Mississippi 13.19%
Kansas 14.13%

The Cortera Past Due by State Report tracks late payments of businesses within each state against agreed upon terms, measuring the percentage of late accounts receivable by state. This monthly report of accounts receivable (A/R) activities by state measures the payment activities of approximately 20 million public and private business locations.

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Cortera Supply Chain Index Up, In Line with Seasonal Payment Slowness

November 4th, 2010 by

Our latest Cortera Supply Chain Index (SCI) numbers are in and jumped by 13% over the prior month. While this might seem like a big jump, this typical for this time of year as we head into the holiday season and businesses tend to slow payments to help finance their expanded inventory. Still, since the beginning of 2010 the Cortera SCI has trended back down to levels last seen in early 2008.

As we look back on the Cortera SCI over the last few years it correlates nicely with both the ISM’s Purchasing Managers Index and NACM’s Credit Managers Index—as both indices started contracting in late 2008 (below 50 on the scale), US businesses also began to slow their invoice payments to their suppliers. In 2009 and 2010 as both the PMI and CMI began to improve and show economic expansion, the SCI also began to improve as businesses became more confident in future sales and made more timely payments to their suppliers.

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Latest Supply Chain Index Steady at Lowest Levels in Over Two Years

July 28th, 2010 by

The June 2010 Cortera Supply Chain Index (SCI) remains in record low territory dropping to 6.79 days beyond terms (DBT), its second lowest level since the index was started in January 2007 and the third consecutive month below 7 days—all good news. The lower the SCI the better as business confidence rises and businesses pay their suppliers in a timely manner. The SCI measures the payment activities of approximately 300,000 businesses covering manufacturers, distributors & wholesalers, retailers, services, and transportation companies.

The June 2010 ISM Manufacturing Report on Business also showed healthy numbers with the eleventh consecutive month of expansion in manufacturing activity. However, it’s not all positive news as the ISM index dropped from 59.7 in May to 56.2 in June. Readings above 50 indicate an expansion; below 50, a contraction. One area to watch is the new orders component of the ISM index – it dropped from 58.5 to 65.7. While still in expansion territory this could indicate a more moderate pace in the second half of 2010. The Commerce Department also reported today that demand for durable goods dropped 1 percent in June—another sign that the recovery may be losing steam. We’ll be watching the SCI closely for any signs of weakness.

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Small Business Index Hits Best Levels Since 2007

July 26th, 2010 by

As we do each month, today, we published our latest report of small business payment activities (see chart below). After watching as the gap grew between the payment habits of large and small businesses throughout the worst periods of the recession, both indices have now converged into a tighter pattern. The SBI peaked out in December 2008 at 12.66 days beyond terms and now stands at 7.02 days – the lowest level since we created the index back in August of 2007. This kind of improvement in paying behavior is typically a sign of confidence, as owners and managers feel more comfortable with the expectation of replenishing cash as new business comes in the door. The latest survey results from the NFIB also support a more confident outlook. In May, the NFIB Small-Business Optimism Index recorded another advance, rising 1.6 points to 92.2. The largest index component improvements were found in expectations of economic conditions (+8 points) and plan to increase inventories (+4 points).

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Consumer, Business Delinquency Data Reveal Mixed View on Recovery, Stress

March 18th, 2010 by

Earlier this week, CNBC (via Reuters) published what looks to be great news when it comes to embattled consumers: Major credit card companies were reporting an improvement in delinquent payments. Simply put, their clients (aka The consumer), were suddenly paying their bills at a faster clip. And while reasons other than improved personal finances were floated (like the use of year-end bonuses to pay down debt), most reporters covering the story – and the companies reporting the good news – suggested this was indeed a sign of the long awaited consumer rebound.

Fast forward to today and Cortera’s related business view of debt and delinquencies – our Past Due by State Report – and the picture looks a little less rosy. Unless of course, you’re a business owner in Nevada.

According to our just published data, businesses in the top-ten most delinquent states look to be trending in the wrong direction, revealing a less than uniform impact of the supposedly improving economy. In fact, 9 of the top 10 most delinquent states showed delinquencies actually getting worse.

One of the nice exceptions is Nevada, far too long a poster child for delinquent businesses. As it turns out, Nevada businesses improved to the point that the state no longer makes the dubious top ten list. And that welcome surprise might be as much a sign of impending recovery as consumers suddenly finding the cash to pay down their personal debts.

So how is the recovery impacting debt, delinquencies and deadbeats in your neck of the woods? Is cash suddenly flowing quicker or is the stress still front and center? We’d love to hear from you.

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Credit by association: Chamber members offer safest bets when it comes to commercial credit

February 22nd, 2010 by

Visit your local chamber of commerce website and you are bound to see list of reasons to join – the benefits of membership. Among the most common cited: networking, advocacy and public policy, awareness and marketing, and of course, local credibility. And now we can add another to the list – one uniquely relevant to small businesses in today’s economic landscape: Attracting credit.

According to a Cortera study produced for the American Chamber of Commerce Executives (ACCE), chamber members consistently received better credit scores than other businesses in their region, their states, and across the country as a whole. The study covers 10 regional chambers to ensure both geographic and economic diversity. To a chamber, member businesses scored well above 600, compared to the national average of 557, even in hard hit states like Oregon and Florida.

When we asked the respective chamber execs why such a favorable discrepancy exists, some suggested it matched with the responsible corporate citizen profile of the average chamber member. Others pointed to a great sense of partnership and local commerce responsibility – local businesses helping each other out by paying their bills more rapidly and ensuring fluid cash flow for all. Still others pointed to the types of programs chambers put in place to ensure members were always up to speed on the best finance, accounting and credit practices. Whatever the answer, one thing is clear: When comes to credit in this era of risk adverse lenders and trading partners, chamber members enjoy a distinct competitive advantage.

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Oregon businesses: “The check is in the mail”

January 27th, 2010 by

Good news, Nevada. You’re no longer the poster child for delinquent payments. While it’s a bit too soon to be popping the champagne – Nevada still ranks #1 in percentage of accounts 90+ days beyond term – Oregon businesses now own the dubious distinction of leading the nation in late payments. According to our latest Past Due by State report unveiled this morning, more than 20 percent of Oregon-based business accounts receivable are past due, the highest percentage of any of the 50 states. Alaska, in contrast, continues to enjoy the lowest percent of past due accounts, with just over 6 percent past due. The national average is hovering in a familiar range of just over 16 percent, which has been the norm over the past year.

Joining Oregon on the less-than-favorable top 10 list are Wisconsin (20.46 percent past due), New Mexico (19.79), Florida (19.72), Minnesota (19.64), Nevada (19.55), Michigan (19.15), New York (18.30), and Hawaii (18.05).

Business Accounts Receivable Debt Past Due by State - December 2009

As the saying goes, “if I don’t get paid, you don’t get paid.” Timely payments are critical to ensuring fluid cash flow and therefore optimizing working capital. Unlike the larger credit story, where business owners can quickly point to banks and other lenders for their woes, we’re all in this one together. And at the risk of over simplifying, we all control our own interdependent destinies. Pick your suppliers, partners and even clients carefully, and make sure you take the time to assess and reassess risk when it comes to the payment behavior of those directly responsible for your cash flow. Or adopt a strategy of doing business exclusively with Alaskan companies.

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