Home topics news Credit: Bruno Kelzer News News Australian business faces disturbingly low activity levels Yajush Gupta November 17, 2023 The recently released CreditorWatch Business Risk Index (BRI) for October 2023 paints a worrisome picture of the Australian business landscape. Business activity in the country has hit alarming lows, with the average value of invoices reaching its lowest point since CreditorWatch began tracking this metric in January 2015, indicating a substantial 34% year-on-year decline. This significant drop in the average value of invoices is indicative of a decline in forward orders, primarily attributed to a contraction in consumer demand. The repercussions are reverberating through the supply chain, creating substantial challenges for businesses across sectors. Key Indicators and Trends: B2B Trade Payment Defaults: Another crucial indicator, B2B trade payment defaults, is on an upward trend. While there was a slight retraction from September to October, it consistently remains above pre-COVID levels, acting as a warning sign of potential business failures. External Administrations: External administrations have surged by 81% year-on-year to October, surpassing pre-COVID levels. This escalation points to heightened challenges faced by businesses, increasing the likelihood of business failures. Credit Enquiries: Reflecting the broader decline in business activity and a reduction in commercial loan applications, credit enquiries have been on a downward trend since May. Business Failure Rate Prediction: CreditorWatch forecasts a substantial increase in the business failure rate, anticipating a rise from the current 4.21% to 5.78% over the next 12 months. Regional and Sectoral Variances: Capital City CBDs: Melbourne