New data from the Atradius Payment Practices Barometer points to a concerning trend across Australian industries:
late payment risk and liquidity stress are increasing, and more businesses are now requesting structured repayment plans just to manage their cash flow.
While this pressure is spreading across multiple sectors, the report highlights one industry in particular:
The agri-food sector is experiencing some of the sharpest cash flow instability in the market.
Rising input costs, tighter margins, and slowed demand have pushed agribusiness buyers to delay payments, extend terms, or negotiate partial repayments. And where one sector goes, many others follow.
For wholesalers, distributors, and suppliers, this environment creates a perfect storm:
higher credit risk, unpredictable cash flow, and more customers needing flexibility just to meet their obligations.
But the good news is that the right payment tools and credit controls can reduce that risk dramatically.
Why Late Payment Risk Is Jumping in 2025
Atradius data paints a clear picture of what’s driving the rise in late payments:
1. Liquidity tightening across the supply chain
More buyers are struggling with their own debtor days, passing the pressure upstream.
2. Operating costs are still elevated
Fuel, logistics, insurance, and labour costs continue to strain margins.
3. Increased buyer caution
Instead of committing to strict payment terms, businesses are spreading payments or requesting structured repayment plans.
4. Seasonal volatility, especially in food and agriculture
Weather-driven supply shocks and pricing swings amplify cash flow problems.
The result?
Wholesalers are suddenly carrying more credit risk than they were 12–18 months ago.
The Impact on Wholesalers and Distributors
The flow-on effects are immediate:
- Debtor days stretch beyond 30–45 days
- Larger customers request extended terms
- Smaller buyers fall behind — sometimes without warning
- Credit teams spend more time chasing payments
- Cash flow becomes harder to forecast
- Dispatch slows when unpaid orders pile up
And in sectors like agri-food, packaging, and building supplies, even one delayed payment cycle can disrupt entire production or distribution schedules.
This is exactly why proactive credit controls and automated payment workflows are becoming essential.
How Wholesalers Can Reduce Late Payment Risk Right Now
To operate safely in a higher-risk environment, wholesalers need to control how credit is offered, how payments are collected, and how overdue invoices are managed.
This is where PencilPay provides a measurable advantage.
1. Implement Structured Payment Plans Without Manual Admin
Atradius’ data shows structured repayment plans are surging — but managing them manually is time-consuming and inconsistent.
PencilPay automates the entire process:
- Customers choose their repayment schedule
- Cards or bank accounts are securely stored
- Payments run automatically
- Failed payments retry with no staff involvement
- Full history and approvals are tracked
This gives buyers the flexibility they need, while giving suppliers the control and cash flow certainty they depend on.
2. Strengthen Credit Controls at the Start of the Relationship
Late payment risk often starts at onboarding.
PencilPay’s digital credit applications help wholesalers identify credit risks before they become expensive problems:
- Real-time credit checks
- Mandatory director guarantees
- Approval rules built into the workflow
- Instant syncing to MYOB Acumatica or Cin7 Core
This ensures customers are onboarded with the right limits, terms, and payment method on file.
3. Store Cards on File for Faster and More Reliable Collections
One of the simplest ways to reduce late payments is also one of the most overlooked:
Store customer payment details upfront.
This gives you:
- Faster invoice payments
- Automatic rebilling on overdue accounts
- Fewer excuses, fewer delays
- Predictable cash flow
When the payment method is already approved and securely stored, risk drops immediately.
4. Automate Reminder Flows and Overdue Messaging
Collections teams lose hours each week chasing payments manually.
PencilPay automates:
- Reminders
- Follow-up notifications
- Failed payment alerts
- Payment confirmations
…all without relying on staff or slow manual processes.
This consistency alone can reduce debtor days by 20–40%.
5. Take Payment at the Sales Order Stage (Not Weeks Later)
The biggest shift wholesalers are making in 2025 is moving payment collection to the Sales Order stage.
Instead of waiting 30+ days post-invoice, businesses can:
- Take upfront deposits
- Charge cards automatically when orders are ready
- Confirm payments before dispatch
- Remove the single biggest source of late payments: “I’ll pay later.”
In an environment of rising liquidity stress, this workflow is becoming essential — not optional.
Risk Is Rising, but It’s Manageable With the Right Tools
The Atradius data is a warning sign:
Late payments are no longer an exception — they’re becoming a structural problem across Australian industries.
But wholesalers aren’t powerless.
With tighter credit controls, frictionless onboarding, and automated payment workflows, businesses can:
- Protect margins
- Reduce bad debt
- Shorten debtor days
- Deliver better customer experiences
- Keep cash flow stable even when buyer risk increases
And PencilPay brings all of this together inside one system, integrated directly with your ERP.