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Credit Matters
What's New At Credit Matters?

What's New At Credit Matters?

This month has involved a number of projects which have not yet been completed. It is one of those things however when the best laid plans do not always eventuate.

The one area of business community which is booming at the moment is work for tradies. Tradies are in demand everywhere. Unfortunately, tradies are also taken advantage of all too easily because their focus is on doing the work, not on managing the risk to their business or assets. If you know any tradies who might benefit from our free feature A Guide to Help Business Tradies Get Paid. The guide can be downloaded from and can easily be installed on their phone or tablet for easy reference.

If you or someone you know need help with outstanding and past due invoices, help is available. Just refer to the brochures of the two qualified and experience credit and accounts professionals also mentioned in our Special Topics segment in this newsletter.

I you wish to promote your business services at an affordable rate, contact Kim at You will be surprised at the value we have to offer.

Quote Of The Month

Quote Of The Month

“You don't find light by avoiding the darkness.”

S. Kelley Harrell

Monthly Business Observation

Monthly Business Observation

If you don’t look for problems, and there are always problems in business, then you cannot expect to survive unscathed from the effects of any problems when they occur. In business therefore, seeking to confront potential problems, means in some respect, looking for them. Too many businesspeople do otherwise and try to close the stable door after the horse has bolted by suddenly being proactive and end up throwing good money after bad.

There are many examples such as failing to acknowledge that borrowing is not always beneficial, even if it classed as “good credit.” This has been acknowledged time and time again during this pandemic. Businesses are still closing down because of debt owed, and many more will close down in the months and years ahead.

Being aware that a recession was pending, and doing something proactive about it, was another failure, after all, there was plenty of warning from a number of perspectives. Yet, there are still businesspeople today, who act as though they are immune from the effects of a recession because they think all is well.

A failure to collect debt owed is another problem with management still believing there is no urgency in getting paid for outstanding invoices. In Australia, preferential payments and repaying insolvency administrators is going to be a real problem in future for these businesses.

The new insolvency provisions rushed through by the government are going to give directors and many bad business owners yet another option to avoid their debts. Creditors as a result, are going to find that as many of their customers close down they will be powerless to collect their unpaid invoices.

No one really knows the number of zombie businesses in the business community who thought government handouts would allow them to keep their employees in a job without further costs to their own business. Again, many of these businesses are going to find their employee obligations have increased through the benefit period. This cost, and the calling for payment from their creditors’ unsympathetic insolvency administrators, are going to cause real problems.

Even if businesses are taking proactive actions on perceived risks in the future, there is no guarantee the business will not bear additional costs. What can be said, is these businesses and their owners attempt to find potential problems, they can create a plan to minimise any damage. This means they have a far better chance of survival, or of keeping their capital and reputations relatively in intact, than those that do nothing.

Monthly Business Conundrum

There appears to be two main employee business models in operation today. One is to support your employees by creating a good corporate culture and a quality business. The other model is to work your employees as hard as possible by keeping the business running lean and mean.

In my view and experience, when you operate the first of the two employee models, you actually get a better return on the dollar paid to and for employees. The likely benefits include, but not limited to:

  • operational efficiency with less mistakes;
  • dedicated employees who are prepared to put in extra when times are tough, or when unexpected opportunities occur;
  • inhouse suggestions to reduce operational and other costs;
  • additional work to help increase customer satisfaction, etc.

Meanwhile the lean and mean philosophy is largely unsustainable in the long run as it often disincentivises employees from doing their best. In such circumstances, the business rarely receives the value of the dollars are spent. This situation usually results in:

  • many unnecessary mistakes;
  • a lack of enthusiasm to do any extra work, and what work is done, is done begrudgingly;
  • a lack of suggestions from employees on working more efficiently and saving costs;
  • poor customer service, etc.

There are times at the start-up stage or occasionally in other times, when a business may not be able to support its employees as much as they would like. It is best however, not to allow this situation to persist too long, or you may find that your business does not really benefit.

As to which model is best in the post pandemic and recession world, only time will tell.

Monthly Business Conundrum
This Month's Business Inconvenient Truth

This Month's Business Inconvenient Truth

As I study the world around us at the moment, I see so many different aspects of business that seem almost alien to what was considered normal in years gone by. One aspect in particular is becoming evident. It is, how easily it is for debtors to avoid paying their debts.

Consumer finance in particular these days is an obvious sector where businesses are being ripped off because debtors are favoured and are not penalised for untruths and fraud. Meanwhile all costs and responsibilities to prove the debtor is at fault, are stacked against the creditors.

It is also becoming evident in the B2B credit environment, there are similar conditions working for debtors and against creditors.

Notwithstanding such disadvantages for creditors, the creditors must also share some of the blame for a lack of action in protecting their rights. Unfortunately, many creditors appear unwilling to learn from the causes of bad debt write-offs and fraud, or initiate actions, and to protect their rights.

Furthermore, debtors will continue to be ripped off as this recession deepens if they do not start standing up for their rights and learn from their losses.

Credit Matters is a financial risk management resource centre for the Australian business community. If you are in business, Credit Matters is your ideal source of financial risk management solutions.

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Future Opportunities & Possibilities

Credit Matters is continuing to grow and provide marketing and knowledge about financial risks to the Australia business community.

Futhermore, we invite marketing and knowledge ideas from our readers and contributors on how we can assist our respective firms grow. If you have any ideas, please contact me at

If you are interested in finding new ways to reach your marketplace, why not try Credit Matters. Our prices for advertising are very reasonable and advertising packages are on offer to make any cost, even more affordable. So if you are interested in reaching your customers at the right price, please contact Kim at for options.