Business Daily Media

Atradius: Australian businesses battle high levels of unpaid debt

  • Written by PR Newswire
Atradius: Australian businesses battle high levels of unpaid debt

Atradius Payment Practices Barometer highlights importance of strategic credit management in the Australian market

SYDNEY, May 23, 2022 /PRNewswire/ -- According to the latest edition of the Atradius Payment Practices Barometer for Australia, high levels of unpaid debt prompt stronger credit controls among Australian businesses as they battle it out for survival in a competitive market.

Several major concerns for the future are spelled out by the results of the Atradius Payment Practices Barometer Survey for Australia in what is a period of severe economic flux. These include the prospect of rising global oil prices and inflation, along with uncertainty about the ongoing pandemic. Fears about geopolitical conflicts and the way supply chain disruption might affect global trade also feature. Companies polled in Australia have significant worries about a negative impact on profits in the coming year.

Despite this, most businesses retain a positive outlook, and they expect some improvement in B2B payment practices during the next twelve months. Trusting customers to make payments may encourage sales expansion and also build loyalty. This might lengthen DSO, however, and have a negative effect on liquidity levels.

Another factor is that insolvencies are expected to increase in frequency in the back half of the year, and perhaps reach the levels last seen in 2019. There have already been some large insolvencies in the first quarter, and this is expected to have some flow-on effect.

"The figures in the report do show signs of increasing stress," said Mark Hoppe, Managing Director Oceania. "They show unpaid trade debt is still high, with 42% of invoices overdue and 6% written off as uncollectable. Payment default risks are growing as the global economy heads towards possible recession. We expect bad debts and insolvencies to continue rising, to at least pre-Covid levels. Suppliers need to be prepared to manage this financial stress. It will be important to have greater market information than just their own trading experience."

The Atradius PPB survey for Australia also found that 46% of companies said they increased trading on credit with B2B customers. Two important reasons were to protect current sales from competition, and to allow B2B customers more time to pay. Once again, this only underlines the crucial importance of strategic credit management. The 2022 Atradius Payment Practices Barometer for Australia was conducted in Q1 2022. The report can be downloaded from the Atradius website at https://group.atradius.com[1] (Publications section) or at https://atradius.com.au[2] (Publications section).

About Atradius: Atradius is a global provider of credit insurance, surety and collection services, with a strategic presence in over 50 countries. The credit insurance, bond and collection products offered by Atradius protect companies around the world against the default risks associated with selling goods and services on credit. Atradius is a member of Grupo Catalana Occidente (GCO.MC), one of the largest insurers in Spain and one of the largest credit insurers in the world. You can find more information online at https://group.atradius.com 

Connect with Atradius Australia on

Twitter: @atradiusAU[3]

YouTube: atradiusAU[4]

LinkedIn: Atradius Australia[5]

 

 

 

Source: Atradius N.V.

References

  1. ^ https://group.atradius.com (group.atradius.com)
  2. ^ https://atradius.com.au (atradius.com.au)
  3. ^ @atradiusAU (twitter.com)
  4. ^ atradiusAU (www.youtube.com)
  5. ^ Atradius Australia (www.linkedin.com)

Read more https://www.prnasia.com/story/archive/3760315_AE60315_0

What Goes into Starting a Small Business?

Many people like the idea of becoming entrepreneurs because of the perks that come with it. From interesting challenges to the luxury of being t...

Business Training

Tips to Keep Your Business Competitive in Today’s Digital Age

Sydney is known to be a startup hub because of the attractive opportunities for business-minded people and the perks of living in the city. Innovati...

Business Training

The top reasons why gyms fail

Steve Grant is a Business Coach and Founder of GymHub.com.au   Every month thousands of new trainers walk out of their 6-month course with the qu...

Business Training

FLK IT OVER raises capital from investors in property sector

FLK IT OVER, a digital document signing tool specialising in residential real estate has secured $2.13M in its first capital raise with financial ba...

Property

Basic Dropshipping Business Tips To Remember

During the pandemic one of the businesses which many people looked to get involved with was dropshipping, a great option if you know what you are do...

Business Training

Power BI Examples Reports

In this article we will be looking at some Power BI Examples Reports. These reports are great for learning how to use Power BI effectively. In this...

Business Training