Credit Matters Blog


Kim Radok 17 January 2024

A review of past business downturns shows us that they rarely occur overnight, nor do they fix themselves quickly just because there are favourable events which give people hope for the future.

In light of the above information, as 2024 begins, we know many of our customers and their customers are already struggling financially. Even if the sales results from November, Christmas and New Year are positive, there is no guarantee, that same level of spending will continue. The belief and warnings from commentators and retailers are not positive that the economic environment will improve quickly.

The following factors suggest that there will be financial difficulties for many well into 2025.

Savings from the COVID years have largely been spent and consumers are starting to use their credit cards again for basic day-to-day staples.

Rents are on the increase and are increasingly reducing renters’ ability to pay for basic living expenses and discretionary spending.

There are a large number of families currently with known and unknown debt which needs to be repaid somehow, or they may be forced into bankruptcy.

The increased interest rates still have to be applied for those home owners which have not already refinanced their home loans. In addition, home owners which did recently refinance at the higher rates, will be forced to pay these higher rates for some time into the future.

Courts are reluctant to penalise people convicted of shoplifting crimes appropriately. It appears they, along many others in society, believe shoplifting is a victimless crime. We know this belief is false. As a result of the courts’ leniency, many criminals maintain their criminal behaviour and we will see other unintended negative outcomes become obvious in the future.

Many organisations and people, now feel entitled to ignore other people’s rights, with negative consequences for all types of business organisations.

In view of these and other issues, those of us in business need to be proactive, and take positive steps to manage the risks and survive in the next few years. Alternatively, your business may be able to take up any opportunities that present themselves. To start with however, you need to be optimistic, practical, and realistic about the steps required. Once you have your mindset in the correct mode, you can proceed with some degree of confidence, even if there are tough decisions to be made that don’t always sit well with you at first. These steps include the following actions.

Identifying whether you have a business that can survive in both the short and long-term without contravening laws and regulations, or by destroying your good reputation. If in doubt, seek professional help, NOW.

If you believe that your business can proceed with a degree of safety, complete an inventory of your:

  1. financial assets, including cash saved or can reasonably be expected to be earned,
  2. review your other or potential income streams,
  3. skill sets and employment options,
  4. business type and product range and whether these factors are relevant in the future,
  5. understanding and experience in dealing with people of all types, i.e. recognising the language and actions of fraudsters and criminals,
  6. requirement for employees and contractors, and under which conditions you can ethically and legally employ them,
  7. ability to be cyber safe, etc.


You will note I have not mentioned seeking finance. There is a perfect reason for not doing so. Going into debt can be beneficial for your long-term success, of that, there is no dispute. Debt however can also be addictive, financially and emotionally damaging when things go wrong. These factors are rarely mentioned or emphasised when talking about going into debt. Cash in the bank, plus assets that can be sold to finance your business meanwhile, provide an element of freedom. It is these factors more often than not, which are the first factors of business success.

The importance of understanding that business is not risk free and that many businesspeople are losing their rights to earn a profit, should never be underestimated. The business world is not a fair place, even if you try your best to do everything correctly, plus success cannot be guaranteed.

The lure of being your own boss and hearing about the success stories is alluring, and for some addictive. When it all comes together, owning and operating a business is a fantastic journey and a worthy objective. Currently however, greater care and more work are required than at any other time in the last 10 years to survive and create a profitable business.

In conclusion, I suggest we are in for a protracted period of financial and economic difficulty for a longer period than is put forward by a number of other commentators. It is also wise to remember that many of those commentators offering a more moderate outlook, are doing so because of their own vested interests.

My suggestions included in this blog have been put forward based on a different perspective. It maybe of course, that I may be proven wrong and economic conditions improve more quickly than suggested. If the economy does improve more quickly and your business has survived, it should also be a stronger and more viable business. At the end of the day, that cannot be a bad outcome.

Want to know more about this topic, contact Kim at, or on Mobile 0411 649 261. Alternatively, have a look at what we offer via our website at