The credit industry’s view is required for the CICM’s headline survey
Views are being sought from the credit industry as to the volumes and value of credit being requested and extended across both the manufacturing and services sectors. The research is part of the Chartered Institute of Credit Management’s (CICM) regular Credit Managers’ Index (UK CMI) that revealed record results in the first two Quarters of 2015.
With the all-time high Q1 (60.2) recorded by the manufacturing industry, and the services sector driving business confidence in the most recent Q2 results (60.7), the new survey will be important in determining which sector is pushing further forward or lagging behind.
The Index, sponsored by Tinubu Square, is important because it gauges nationwide levels of credit being sought and granted by credit managers across both the manufacturing and services sectors. It therefore acts as a primary indicator of actual levels of business being conducted.
But whether 2015’s trend of high results is set to continue will be determined by the new research: “The credibility of this index rests upon credit managers, government departments, business organisations and CICM members’ responses, and I urge all to submit their experiences to the Q3 survey,” says Philip King, Chief Executive of the CICM.
Philip explains the index has closely tracked the FTSE All-Share’s highs and lows over the past five years: “It will be interesting to see whether the FTSE 100’s recent market correction will have an effect on the UK CMI Index, or whether business confidence will continue to be as strong.”
The CMI is a diffusion index producing ‘scores’ of between one and 100 (typically in a range of 40-60). Ten equally weighted factors are included – three favourable and seven unfavourable – and the index is calculated on a simple average. Credit Manager’s views and statistics are sought on such issues as applications for credit through to days sales outstanding.