When you’re running a business, keeping things moving forward can feel like a constant balancing act. Right now, many business owners are doing it tougher than usual. Costs are up, margins are tight, and payment delays are more common. This environment is putting pressure on businesses, and if you’ve noticed it getting harder to stay on top of your accounts, you’re not alone.

 

Optimum Recoveries helps Australian businesses like yours stay in control through a combination of debt prevention, debt management, and debt recovery services. We work closely with business owners to put practical systems in place that reduce risk and support stronger, more sustainable growth. Whether you’re looking to tighten your credit processes or need support chasing overdue invoices, we’re here to help you protect your business.

The Reality Behind the Numbers

Australia is home to over 2.6 million businesses. Almost all of them fall into the small business category, with 98% employing fewer than 20 staff. While the number of new businesses continues to grow year on year, around 60% of them won’t make it past their third birthday. The most common reasons include inconsistent cash flow, poor credit control, and a lack of payment certainty.

 

In the 12 months to June 2025, court actions linked to unpaid debts stayed high. Business-to-business payment defaults increased by 42%, and insolvencies plateaued at 46% above the previous year. Construction and hospitality businesses are experiencing the most pressure, accounting for 40% of insolvencies across the country. A shift in ATO policy means interest charged on overdue tax debts will no longer be tax-deductible after July, adding another layer of stress to already stretched budgets.

 

While business owners are putting in longer hours, many are still operating at a loss or earning below the national average wage. These pressures reflect a challenging environment that requires clear systems, strong boundaries, and better credit habits.

Cost Pressures and Operational Challenges

Labour shortages, inflation, and rising costs of raw materials are pushing operating costs higher. At the same time, wages and superannuation obligations continue to climb. From July 2025, super is rising to 12%, which will affect your overall staffing costs. While productivity is showing a slight improvement, it hasn’t recovered from last year’s decline, and many businesses are still playing catch-up.

 

There’s no single solution to these challenges. But by taking control of your credit processes, you can start to limit your exposure to risk and protect your revenue. Start by reviewing your terms and conditions. Make sure your policies are clearly defined and that your team understands how to apply them consistently. Payment expectations should be clearly communicated upfront, with boundaries in place if customers miss their obligations.

 

Here are some ways to reduce financial stress:

 

• • Use a standard process to assess new customers before offering credit
  • Track payment behaviours over time to identify risk early

 

Setting clear expectations around credit from the beginning of a customer relationship can make a significant difference in how payments are managed later.

 

A Stronger Foundation for Future Growth

More than 84% of Australian businesses report annual turnover under $2 million. That means even small interruptions to cash flow can have big consequences. With payment delays currently averaging more than 22 days beyond standard terms, there’s little room for error. Being clear on your own risk appetite can help you make smarter decisions about who you work with and how you get paid.

 

Now is the time to put the right people in charge of credit and collections. Make sure you have good visibility across your invoice-to-payment cycle so you can step in early if a payment goes missing. It’s also worth taking a closer look at any previous customer write-offs. These past experiences hold valuable lessons that can help you avoid similar losses in future.

 

If you’re concerned about slow-paying clients, clients stretching your goodwill by ignoring agreed terms, or aged receivables creeping up, Optimum Recoveries is here to support you with practical solutions.

 

Need help with debt prevention, management, or recovery? Get in touch with Optimum Recoveries today.

– Michael Blonk, Credit Professional.