A big customer is paying late: a practical cash plan for this week and next

For a small business, one big customer paying late can do more damage than a whole quiet month. The work is done, the costs are paid, the invoice is out — and the money that was meant to cover wages, the BAS and the supplier just isn’t there.

The temptation is to wait and hope. The better move is to act, in a clear order, starting today. Here’s a plan.

Today: find out why it’s late

Before assuming the worst, find out what’s actually happening. Many late payments come down to something simple.

1. Check the contract and the invoice. Are the payment terms what you think they are? Was the invoice correct — right entity, right purchase order number, right contact? business.gov.au’s first step when you haven’t been paid is to review the contract and any written agreement.
2. Call your contact. Not an angry call — a practical one. “I’m just checking invoice 1042 was received and approved. When is it scheduled for payment?”
3. Ask who approves payments. If your contact doesn’t know, find out who does.
4. Write down what you’re told. Name, date, and the payment date promised.

Often this is enough. The invoice was stuck waiting for approval, or went to an old email address. Fixed in a day.

This week: map the next few weeks of cash

Whether or not you get a firm date, work out what’s due out and when. A simple table is enough:

Week	Money in expected	Money out due	Balance
This week		Wages, PAYG, super
Next week		Supplier, rent
Week 3		Wages, super
Week 4	Late payment (if it arrives)	BAS, loan repayment

Then decide what comes first. Wages, PAYG withholding and super should sit at the top. Since 1 July 2026, Payday Super means super contributions must reach employees’ funds within 7 business days of payday, so super now needs cash every pay cycle. Unpaid PAYG withholding and super can also become directors’ personal liabilities under the ATO’s director penalty regime. Our wages and super call prep goes into this.

If the map shows a gap you can’t cover, it’s worth talking it through early rather than on the day before payroll. You can request a call-back here and pick a window that suits.

This week: talk to the people you owe

A late payment into your business can quickly become late payments out of it. Get ahead of that:

• Suppliers. Explain briefly, and ask for a short extension or a part-payment arrangement — in writing.
• The ATO. If a BAS payment will be late, the ATO advises contacting it before the due date. Businesses owing $200,000 or less can set up a payment plan themselves online.
• Your landlord or lender. A heads-up before a missed payment goes much better than an explanation after.

business.gov.au’s guidance on managing debt says speaking to creditors early can prevent late penalties and collection action, and suggests documenting every conversation.

Next week: follow up in writing

If the payment date passes, or you didn’t get one, move to writing:

• A clear, polite email restating the invoice number, amount, original due date and any date you were promised.
• Attach the invoice and any proof of delivery or completion.
• Ask for a specific payment date.

Keep it factual. You still want a working relationship with this customer if possible.

It also helps to think about what you’ll do with the customer’s next order. If they want more work while an invoice is overdue, it’s reasonable to ask for the overdue amount first, a deposit on the new job, or shorter terms until the account is back on track. Say it calmly and early, not as a threat when the next job is already half done. Many customers respect a business that’s clear about its terms, and it stops one late invoice quietly becoming two.

Keep a simple log as you go: each call and email, who you spoke with, what they promised and when. If the matter ends up with a mediator or a debt collector, that record saves time and strengthens your position.

If it drags on: escalate in steps

business.gov.au sets out a sequence for recovering unpaid money:

1. Reminder — by phone, email or letter, discussing the missed payment and possibly a new timeline.
2. Letter of demand — a formal request for payment. business.gov.au suggests getting a legal professional to draft one.
3. Dispute resolution — including low-cost mediation through the Australian Small Business and Family Enterprise Ombudsman (ASBFEO).
4. Debt collection agency — telling the customer you’ll use one often prompts payment.
5. Legal action — small claims tribunals or court for larger amounts, though this can be costly and slow.

ASBFEO’s dispute support covers payment disputes among other issues, and offers mediation and referrals. It’s worth knowing about before things become adversarial.

Should I borrow to bridge the gap?

It depends on one question above all: is the payment genuinely coming?

Situation	Bridging finance?
Customer has confirmed a payment date; approval was just delayed	Can make sense for a short, clear period
Customer is slow but reliable, and has always paid in the end	Can make sense, with a buffer on timing
Customer is disputing the work or the amount	Be cautious — resolve the dispute first if you can
Customer is in financial trouble or not responding	Don’t borrow against it — get advice on recovery

If bridging does make sense, a specialist will want to see the invoice, the customer’s payment history with you, what you’ve done to chase it, and your map of the next few weeks. Unsecured and cash-flow options for trading businesses typically run from $5,000 to $500,000, sized on turnover and bank statements. Our cash flow gap call prep covers what to have ready, and the call-prep tool will build your checklist.

How do I stop this happening again?

business.gov.au’s advice on preventing late payment is practical:

• Signed contracts with clear payment terms.
• Professional, correct invoices, sent promptly — ideally the day the work is done.
• Clear payment terms that customers agree to up front.
• Checking new customers before extending credit.
• Deposits or progress payments on large jobs.

It’s also worth looking at concentration. If one customer makes up a large share of your revenue, a single late payment will always hurt. Spreading work across more customers over time is one of the best cash flow protections there is.

Should I use finance against the invoice itself?

Sometimes the most direct fix is funding linked to the money you’re owed. business.gov.au lists invoice financing among the common funding options: a finance provider advances part of the value of an unpaid invoice, then collects or is repaid when the customer pays. It can suit businesses with a steady flow of invoices to reliable customers.

Before choosing it, ask:

• What share of the invoice is advanced, and what are all the fees in dollars?
• Does the customer find out? Some arrangements are confidential; others aren’t.
• What happens if the customer doesn’t pay — are you still responsible?
• Is it one invoice at a time, or a facility across all your invoices?

For a one-off late payment, a short-term facility or a revolving limit may be simpler. For a business that regularly waits 45 or 60 days on large customers, invoice-linked funding can smooth things permanently. A specialist can compare the options for your situation.

Ready to talk through the gap?

A late payment is stressful, but it’s usually a timing problem, and timing problems can be managed with the right plan. At Loan Hotline, asking for a call-back involves no credit check, your details aren’t sent to a crowd of lenders, and a real specialist reads your situation before ringing.

Please give accurate figures in the request — the amount, what’s owed to you, your state and any property you own — so we can match you properly on the first call. Choose a time and we’ll ring you.