Ask a business owner to list the things that keep them awake at night and you may return with some pretty interesting answers, but odds are cash flow will be one of the first items that springs to mind.

This is not surprising when you consider how important cash flow is to the way any business functions, from the property developer behind the next 40-storey apartment complex to tower over the CBD to the café on the corner. Cash flow is what allows these businesses to bring in staff, meet obligations, pursue growth – it’s literally what keeps the lights on.

When a business’s cash flow slows to a trickle, it becomes a real problem and there’s no one-size-fits-all solution. That’s where brokers come in. With their ability to deliver bespoke finance options, brokers can play a vital role in easing the pressure through clever solutions.

Pressure cooker

While every sector feels cash flow pressures differently, small businesses tend to feel it most acutely.

Earlier this year, major lender Commonwealth Bank of Australia (CBA) released research that highlighted the scale of the problem. Nearly 80 per cent of small- to medium-sized businesses (SMBs) reported experiencing cash flow issues in the past 12 months, according to CBA’s research, with declining revenue (35 per cent), low cash reserves (30 per cent), and seasonal fluctuations (27 per cent) identified as the main culprits behind the trend.

What can be exhausting for many business owners is the fact that many cash flow issues stem from forces and factors that lay outside their sphere of control.

The March 2025 Business Risk Index from credit reporting agency CreditorWatch – which showed a 17 per cent increase in insolvencies and 42 per cent increase in payment defaults when compared to March 2024 – identified a range of external factors that had contributed to business cash flow difficulties during recent months.

Pricing pressures and rising costs were the key themes in the research, particularly for discretionary businesses impacted by constrained levels of consumer demand caused by high interest rates, elevated rents, and stagnating wage growth. On the other side of the coin, businesses also had to contend with rising costs for rents, labour and insurance; ATO tax debt; and increases to the superannuation guarantee rate (rising from 11.5 per cent to 12 per cent from 1 July 2025), plus uncertainty caused by the US government’s trade war.

James Beeson, CEO of business finance provider Earlypay, tells The Adviser that these combined challenges have led to a “cash flow crunch” for many businesses, particularly for small- to medium-sized enterprises (SMEs).

“At a time when SMEs are already battling rising operational costs, a tight labour market, and inflation, these changes will only increase cash flow pressures,” Beeson says.

“Many businesses will need to rethink their finance strategies.”

Working capital

When it comes to navigating cash flow pressures for clients, the most successful businesses tend to be the ones that get the basics right, according to Valiant Finance broker Jacob Morris, named Finance Broker of the Year at The Adviser’s Australian Broking Awards.

“Having a fallback option (such as an overdraft or line of credit) can go a long way in helping [to] maintain peace-of-mind,” Morris says.

“The goal here is simple: build a safety net and know it’s there if you need it.”

Morris says flexibility tends to be one of the most important qualities clients seek from cash flow solutions. But providing a transparent, simple process can be just as valuable.

Business owners are busier than ever and need to operate with maximum efficiency to make their lives as easy as possible
- Jacob Morris, broker, Valiant Finance

“Business owners are busier than ever and need to operate with maximum efficiency to make their lives as easy as possible,” Morris says.

“When presented with options, they want complete transparency to make quick decisions. Given current market conditions, my clients are often most interested in overdrafts, lines of credit, debtor and invoice finance, as well as term loans with favourable early payout options.”

Morris also encourages brokers to do their research and better understand the range of options that are available to the clients they service.

“I know this sounds simple, however from my conversations with brokers, I’m often surprised to find a significant gap in the range of lenders that many brokers consider when structuring deals,” Morris says.

“Many brokers seem unaware of the incredible variety of products and offerings available, often leading their clients to more expensive options or ones that really don’t fit the profile of their clients. Lenders today are forever evolving and can provide innovative and tailored solutions.”

With so many moving parts and a wide range of cash flow finance solutions on the market, Morris says brokers can provide clarity and confidence to businesses that are under pressure.

“By advocating for, and taking [the business’s] best interests into account, you can create highly rewarding and lasting relationships with your clients – helping them achieve their goals and being a crucial part of their success,” Morris says.