Drugstores Payment Declines While Retail Continues to Rebound Overall

Credit2B’s trade credit risk data delivers insight on payment trends in the retail sector of the US economy.

South Plainfield, NJ, October 16, 2013

Credit2B, the world’s leading web-based trade credit community providing industry-centric intelligence on common customers, released its Payment Quality Index (or PQI) for major segments in the retail industry. PQI measures the probability that a trade creditor will collect its money within its terms of sale on a scale of 0-100 (100 being perfect), derived from tens of millions of trade receivables experiences of Credit2B’s contributing members.

Over the last four quarters, from July of 2012 and continuing into July 2013, grocery stores in the Credit2B index showed significant improvement in payment trends from 89% to 93%, while drugstores showed significant declines over the same period overall from 87% to 77%, while the index for mass merchandisers and discounters stayed more or less flat over that period. For more details of major trends in the retail industry view Credit2B’s Retail Performance Monitorwhich is a monthly indicator of major trends impacting the industry, click here.“Drugstores have been impacted by tighter pharmacy payout rates from benefits managers, Medicare and other insurance carriers,” said Bob Carbonell, Credit2B’s Chief Credit Officer about the challenges facing drugstores over the period. Jaime Palanca, Credit2B’s Food and Drug analyst pointed out that “grocery stores continue to feel tighter margins and in this environment, vendors are helping with extended terms and plenty of support for special promotions.” Credit2B’s deep understanding of the retail sector payment trends comes from the significant representation of major brands that exchange trade payment experiences in a real-time, high-quality environment. These payment index trends are a more accurate representation of financial risks because Credit2B is meticulous about excluding payment experiences from utilities. “Retailers pay their utility bills on time so they can keep their stores running. Unlike trade supplier trade experiences, this type of trade data is an inherently bad predictor of risk so you really need to ensure your credit information provider distinguishes between these different sources when providing a credit opinion or recommendation,” explained Bob Carbonell. Credit2B delivers deep insight from its industry-specific data and its credit analysts like Bob Carbonell and Jaime Palanca who have significant experience as credit practitioners working at firms like D&B, commercial financing organizations or in credit risk operations for mid-size and large companies.

About Credit2B 

Using patent-pending technology, Credit2B is a platform that empowers peers to exchange trade credit data and share common experiences. Built as a cloud-based application, Credit2B today delivers remarkably high quality and timely information which is validated by a network of trusted connections. Credit2B is simple to join, create connections and access huge amounts of information on common customers from peers and third party databases through a high-fidelity experience.