Demand for farm sector services and products is as bullish as it’s ever been, but small to mid-sized businesses are also carrying huge expenses as they absorb spiralling running costs while awaiting payments on monthly invoices.
Surging fuel and power prices, expensive supply chain delays and rising interest rates are compounding the usual pressures for agribusinesses whose customers can legitimately take up to two or three months to pay their bills.
Despite busy trading conditions, the spiking cash flow challenges for farm supplies retailers, transport operators and fresh produce farmers have caught many off guard.
Businesses are being forced to find innovative ways to keep ahead of galloping inflation.
Not so surprisingly, one of the most popular overseas forms of business finance – short term invoice financing – is now gaining momentum among Australian small businesses.
“What is more surprising is that less than 10 per cent of eligible Australian businesses currently use some form of invoicing finance, whereas in the US, Europe and the UK it’s standard practice for a significant portion of operators,” said OptiPay chief executive officer, Angus Sedgwick.
OptiPay, which established locally in 2013, saw a 45pc jump in the number of regional businesses looking for its services to help address their cash flow needs last month.