The Australian Small Business and Family Enterprise Ombudsman, Bruce Billson, has released a comprehensive guide to assist small businesses in managing debts, whether they are owed money or need to pay off debts themselves.
“Outstanding debts can be overwhelming for a small business—whether a customer owes you money or you owe money to a supplier,” Mr Billson said. He noted a 50% increase in calls from small businesses concerned about potential insolvency, either of their suppliers or their own operations.
The Better Help Guide – Small Business Debt outlines how the Ombudsman’s office can support small businesses in navigating debt challenges. While the office does not provide legal advice or debt collection services, it offers information and resources to help businesses make informed decisions about recovering or paying debts.
For those needing assistance with debt or cash flow issues, the Small Business Debt Helpline operated by Financial Counselling Australia provides free, independent, and non-judgemental advice. Qualified financial counsellors are available via phone at 1800 413 828 or through a web chat.
Mr Billson emphasised the personal stakes for small and family business owners, who have invested their life savings and even their homes into their enterprises. He highlighted that nearly half of outstanding small business loans are secured by residential property.
“Cash flow is the oxygen of enterprise,” Mr Billson stated, noting that surveys indicate 60% of small businesses have low or zero cash reserves, leaving them vulnerable when expected payments are delayed.
The guide suggests that businesses owing money should consider paying any part they can and propose a payment plan for the remainder, demonstrating good faith and potentially reducing the risk of legal action and additional interest charges.
Similarly, businesses owed money are encouraged to seek workable resolutions and understand realistic options to secure payment, recognising that unpaid bills can cascade through the supply chain.
The Better Help Guide – Small Business Debt is available for free at asbfeo.gov.au/debt.
