Australian small businesses face cash flow and unfair practice pressures

Australian small and medium enterprises (SMEs) are facing significant liquidity challenges following the implementation of Payday Super on July 1. The new regulation requires businesses to pay superannuation contributions within seven business days of each pay run, rather than on a quarterly basis. According to ScotPac’s SME Growth Index Report, 75% of SMEs report that the change is impacting cash flow, with 83% of businesses earning between $1 million and $5 million annually expecting a negative impact.

In a separate development regarding business protections, the Australian Competition and Consumer Commission (ACCC) has urged the federal government to consider implementing protections against unfair trading practices. In a submission to the Treasury, the watchdog suggested adopting elements of European and Japanese models, such as a “blacklist” of prohibited conducts including late payments and commercial retaliation. Small business owners have highlighted the existential risks posed by the power imbalance between large retailers and small suppliers, citing instances where contract changes and pricing pressures have forced businesses to exit specific markets.