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Credit Matters
What's New At Credit Matters?

What's New At Credit Matters?

At last we can announce our revamped website is now due for release by the 13th of July. Please note it may not be accessable on the 11th or 12th of July as the changeover is completed.
The attachment with this newsletter includes an update from the Australian Small Business and Family Enterprise Ombudsman
Kim is available to help with your questions and concerns if you need any assistance, and as always, the first chat is always free of charge or obligation. 
Quote Of The Month

Quote Of The Month

If you don't have the time to do it right, when will you have the time to do it again?
Nati Gabay• 3rd+Project Manager at Intel Corporation
Monthly Business Observation

Monthly Business Observation

One of the great problems within business is operating efficiently, i.e., whilst making very few mistakes, delivering product and services on time and getting paid in a timely manner for your efforts. Operating a business is difficult enough, however when mistakes are made, they negatively compound efficiency problems and increase costs.

Furthermore, when mistakes are made, it causes a loss in cashflow and profits by allowing your customers to raise an excuse to slow pay your invoices. In times like these, there is nothing your cash strapped customer likes better than another excuse to avoid paying their suppliers. A number of your customers of doubtful integrity or the zombies, may even instigate a program of raising false credit claims based on your business’s history of making mistakes.

The truth is unfortunately, that in time many cash strapped, inefficient, and heavily indebted suppliers may become insolvent before their customers pay them. After all, your suppliers’ creditors may also be pressing them:

1          to pay more quickly;

2          to clear older debts because the supplier is now on stop supply with their creditors;

3          to pay cash up front or on reduced terms because of their own past slow paying history;

4          because the ATO has forwarded a Director Penalty Notice (DPN);

5          as the directors now fear for their good reputations;

6          because the directors fear being found guilty of insolvent trading;

7          as the business has been closed by the owners as it is unprofitable; etc.

On top of all the other negative factors associated with mistakes, time is a major factor. Not only do you need to find the time to fix the mistake, you need employees to also have the time to process the mistakes. As we know, almost every business is currently affected by staff shortages. If that is the case in your business, the question is “… when will your mistakes be resolved?”

It also goes without saying, if there is any delay in processing mistakes, you still may not get paid or earn a dollar. Many mistakes may not result in the raising of an invoice or adjusting the value of an invoice already raised. In addition, if the time delay is protracted, and you are dealing with a zombie business, you may find they are no longer in business.

In resolving the factors which create mistakes, you will often find elements of commonality. In other words, the same mistakes made today, were made yesterday, and unless the causes have been eliminated, will occur again in the future.

Again, there is a cost in this identifying process and then correcting the factors which cause mistakes. Strange as it may seem, many businesses struggling to survive, or operating to a cost minimisation business plan, often see little benefit in conducting a progressive campaign to reduce and eliminate the causes of mistakes. In a cash poor environment, with a reducing marketplace in almost every industry setting, failing to act on mistakes is just another potential cause of a business’s insolvency.

In conclusion, a business needs to operate efficiently, i.e., without making mistakes, delivering product and services on time and getting paid in a timely manner for your efforts. Operating a business is difficult enough, however when mistakes are made, they negatively compound efficiency problems and increase costs.

If a business cannot operate profitably, and without a high level of mistakes because it fails to resolve the causes of mistakes, it is just another cause of business problems and insolvency. Never has it been more important in the current environment to concentrate on eliminating and dealing quickly with mistakes.

Monthly Business Conundrum

The problem arises when after reviewing your business affairs, you find that it may not be viable, is to make the decision to continue or close it down. The main problem we all face in these situations is not so much a monetary one, although this should always be the defining factor, it is the emotional factor.

Most of us operating a micro to middle sized business, are welded emotionally to our business because of a number of personal factors. This emotional factor unfortunately is often overlooked or minimised by many not directly associated with your business.

There is no easy solution in resolving this factor in your decision making as it is also a major roadblock for many of us who operate our own business. It is an understanding that needs to be recognised if we, as business owners are to move forward in a positive manner.

After reviewing your business, if it is truly in trouble, and the factors might be one of many, as a business owner, you will need help in making the correct decision. This help may initially come from a trusted friend, a family member or mentor who understands that the final decision is always partly an emotional one.

If you do not have access to the above support, or still cannot clearly make a decision, it is ESSENTIAL to seek assistance from a suitably qualified business restructuring and insolvency professional. It is true, not all these professionals will understand the emotional component in making your final decision. They will however, in the most cold-blooded manner, advise you on the possible financial and reputational consequences of your decision or failure to make the right decision.

It is this cold-blooded approach that often helps you, and the rest of us including myself, break through the emotional roadblock that has caused us to delay in making the correct decision commensurate with our own personal affairs.

The commercial environment is currently in a state of turmoil, and as such, it is really important that you review the viability of your business. If you have any doubt about it’s viability, then you need to make the correct decision which will result in the best possible outcome for you.

Monthly Business Conundrum
This Month's Business Inconvenient Truth

This Month's Business Inconvenient Truth

In the good times of the past, a slightly higher level of bad debts and poor payment behaviour could have been tolerated in an effort to increase sales and to achieve other beneficial objectives for your business. This philosophy could be tolerated because if properly managed, there were usually other sales available to help defray the cost of the bad debts and slow payments which inevitably followed.

With today’s uncertain commercial environment, the reality is that many businesses are likely to confront a reduced number of normal or standard type of sales. In the past, the costs of bad debts and slow paying customers could be hidden to some degree as there was always the potential pipeline of new sales.

Today, this pipeline is no longer readily available for many businesses. This situation will add pressures on these businesses to find a way to create as many profitable sales as possible. Unless the number of bad debts and slow paying customers are managed properly, a business could soon be in trouble.

As a result, new sale-payment strategies will be required and implemented by suitably and experienced professional people at all levels of the business who can sell these strategies. In fact, these strategies will require closer co-operation between management, marketing, sales and credit managers like never before.

In all, the strategy must be based on common sense and realistic budgets commensurate with the current business environment and not the past ideology of marketing and sales alone based on the environment of that time.

A failure to understand our new business environment and sell appropriately, will increase sales in line with yesterday’s thinking. It will not necessarily however increase cash flow, profitability or reduce bad debts and slow paying customers.  Yet it is these last four factors which are the most relevant for business survival.

Latest Blogs & Readings

Latest Blogs & Readings

Recently we have all seen and heard about an increasing focus on phoenix companies and their directors. Now is the time to understand what this means for your business and yourselves personally.

Updates courtesy of

Media Updates

Media Releases

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.