How do your days of exposure compare?
The last Utility Information Pipeline analyzed the possible deposit refund or bad debt write-off, based on early results from the Days of Exposure tool featured a few issues ago. If you remember, Days of Exposure is the total number of days of service a customer ends up owing for if they are disconnected for non-payment and never reinstate service.
Last week, a customer asked how their utility’s Days of Exposure compared to others who used the tool, so this issue reports those results. Thus far, 50 people have completed the Days of Exposure tool, 45 of which bill monthly.
The Days of Exposure tool doesn’t ask who is completing the page, but it does log the values for each entry. This means I don’t know which utilities are represented by the results.
Days of exposure
The Days of Exposure for those utilities that bill monthly ranged from 53 days (1.77 billing periods of exposure) to 116 days (3.87 billing periods of exposure). The mean (arithmetic average) is 81.72 and the median (equal number of smaller and larger values) is 79.
Analysis of results
As described in the last issue, 53 Days of Exposure is impressive! I consider anything under 60 to be excellent (in order to complete the delinquent process before billing again). Anything over 70 is generally indicative of areas that can be improved or policies that need to be changed.
Of the 45 responses shown above, three were under 60 days, 11 were between 60 and 70, and 31 were greater than 70.
Reasons for a high number of days of exposure can include excessive time between reading meters and mailing bills, the number of days between the due date and when bills are actually delinquent, long periods between the delinquent date and a final notice, and extended time before finally disconnecting for non-payment.
If you haven’t already done so, I invite you to take a minute and click here to calculate your utility’s Days of Exposure to see how your utility performs and determine if you are at risk for a potential bad debt write-off.
Are your days of exposure as low as they could be?
Are your days of exposure as low as they could be? To find out, please give me a call at 919-232-2320 or e-mail me at email@example.com to learn how you could benefit from a business review.