Measuring payment activities of approximately 350,000 businesses, the March 2010 SCI dropped to 7.65 days beyond terms (DBT), its lowest level and best reading -- since August 2008.
The Supply Chain Index (SCI) is a monthly index of accounts receivable activities covering manufacturers, distributors & wholesalers, retailers, services and transportation companies. It is created by Cortera, a community-driven business credit bureau.
"Payment behavior can been seen as a barometer of confidence in future sales and demand. And when payments between partners show this kind of improvement, it provides an indicator of overall optimism," said Jim Swift, CEO of Cortera. "It remains to be seen whether such optimism can be maintained, but it is clearly a positive development for businesses seeking what has been an elusive improvement in cash flow."
Corteras Supply Chain Index™ (SCI) is a measure of financial confidence. The Cortera SCI tracks late payments against agreed upon terms, measuring late accounts receivable (Late A/R), excessively late accounts receivable (Late A/R >30 days), and overall average days beyond terms (Average DBT).