Australian Small Business and Family Enterprise Ombudsman Kate Carnell said she’s disappointed by reports of big businesses using COVID-19 as an excuse to delay payments to their small business suppliers.
Ms Carnell explained that it is vital large businesses pay their small business suppliers on time, for the sake of the small business as well as the national economy.
“Now is the time for big businesses to do the right thing and be a part of the solution in this very difficult period,” she said.
“Cash flow is always king for small businesses and never more so than now, particularly for small businesses struggling with the ripple-effects of coronavirus.
“That’s why it’s so important for big businesses to step up and pay on time or reduce payment times.”
Ms Carnell noted that the ASBFEO’s Payment Times Inquiry and the Insolvency Practices Inquiry both showed that cash flow is the leading cause of insolvency.
“It’s been so encouraging to see some big Australian businesses such as Telstra, BHP, Rio Tinto and more recently Woolworths, commit to faster payment times and there’s no reason why others can’t adopt the same practices,” she said.
“Any small business experiencing issues with payment times are encouraged to contact my office for assistance.”
Earlier this month, research revealed that the average Aussie SME is waiting 56 days to be paid, almost double what the Ombudsman is seeking big business to commit to.
