Insolvency-hit grain industry small businesses urged to protect themselves
Speaking at the 2020 Victorian Farmers Federation Grains Conference in Moama today, the Australian Small Business and Family Enterprise Ombudsman Kate Carnell urged small businesses in the grain industry to take steps to future-proof their operations.
“Small businesses have been hit hard over the past 15 years with a spate of insolvencies across larger grain buying businesses leaving millions owed to growers,” Ms Carnell says.
“These Australian grain traders’ insolvencies have cost small business growers more than $50 million since the year 2000.
“It’s important that small businesses in the grains industry do what they can to protect their businesses.
“I’d encourage these small businesses to do their due diligence on customers by making sure they pay on time, checking the business register to confirm details and doing necessary credit checks.
“Grain growers should try to avoid being reliant on one customer to reduce their risk.
“If a customer becomes insolvent, contact the external administrator to make sure you are recorded as a creditor and attend meetings throughout the process.
“Like all small businesses, grain growers should stop supply if they haven’t been paid.
“Insolvencies in the grain industry – particularly the impact it’s had on small businesses – is an issue that is being looked at as part of our ongoing Insolvency Practices Inquiry.”
The final Insolvency Practices Inquiry report is set to be handed down at the end of March.