The Top 3 Concerns of CFOs in 2022

The trials and tribulations of the economy, business and personal life has taken many turns over the past two and a half years. It has been one of the most challenging periods for businesses and individuals to navigate through.

But what are the current top concerns of CFOs and Credit Managers and what keeps them up at night?

After surveying hundreds of our clients, they have given us an insight into their top 3 concerns for 2022.

1. Sourcing materials and an increase in the costs of goods

Anyone who's building a house will no doubt know the pains of supply delays and increasing raw material costs! In a recent case someone waited an additional eight months beyond their original completion date and had variations of over $50,000 to complete their build. But, the building industry is not the only sector experiencing increases in costs. Food, services, and energy costs have hit the hip-pocket of individuals and increased the expenses on businesses’ P&L.

This naturally leads to higher overall costs and end product increases to the consumer.

2. Labour shortages

Everyone has a story of needing to quickly rebuild or replace positions post the pandemic. The disruptions to the business environment in many sectors led to layoffs or redirection of labour throughout 2020 and 2021. Look at the Whilst sourcing materials and costs, as well as transportation factors, are easing, labour shortages and overdue debts seem to be ongoing factors we will all need to deal with.

So where does your business sit on these concerns?

NCI, with our full range of trade credit services, can support businesses in preparing and sleeping better at night, by removing the worry relating to predicting, and protecting yourself against, non-payment or insolvencies. Ask yourself these questions: • When was the last time you conducted a full health check on your customer list? • What was the impact on your customers throughout the pandemic? • Do they have the same level of capital and cashflow to maintain their business in a healthy environment?

challenges facing the travel sector in trying to quickly replace labour to deal with the current and future demands.

Labour short ages also bring a lack of skills in specialist sectors and industries, placing pressure on existing wages and acquisition of new labour.

Many businesses are having higher than ‘normal’ levels of staff changes which compounds to recruitment, training and workflow pressures.

3. Overdue debts and customer non-payment

21% of survey respondents highlighted their concerns about increasing overdue debts and non-payments from their customers.

This is a trend which many economists predict will increase further over the next year. Businesses have experienced extremely low insolvency rates and, with government incentives through the pandemic, businesses seemed to be flush with cash.

Recent ASIC administration data shows there has been a rebound in business insolvencies and our own NCI data highlights overdue reporting rates increased dramatically at the beginning of 2022. Led by the building construction sector this is a tell-tale lead into further insolvencies.

Cashflow issues, rising interest rates and lower predicted sales revenue were other factors which were concerning our clients.

NCI’s unique database, and ‘secret intel’ can provide a business with early warning signs specific to your customer list. We alert you to those customers who may not be in a position to pay into the future and allow you to make early changes to avoid non- payment and bad debts into the future.