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Retailers across the nation are facing a severe 'cost-of-trading crisis' as they grapple with rising overheads, including wages, energy bills, and insurance premiums.
Due to these mounting financial pressures, many businesses have voiced their concerns, calling for government intervention to help stabilize the precarious situation.
A recent study commissioned by the National Retail Association has thrown a spotlight on these pressing challenges, with business owners indicating that such costs are the most significant barriers to their enterprise's success. An alarming number of respondents believe their business's performance may deteriorate, with over half fearing a drop in annual profits compared to the previous year.
Rob Godwin, the National Retail Association Director, is flagging this troubling trend as a 'cost-of-trading crisis' within the sector. He calls upon the federal government to seize the May budget as an opportunity to confront these spiraling expenditures, which also contribute to rising consumer prices, thus exacerbating the overall cost of living.
Godwin singles out the acute difficulties faced by regional and rural operations, which bear the brunt of surging transportation and logistics expenses. He suggests that direct funding support could alleviate some of the financial strain on these businesses, and by extension, help shore up supply chain complexities.
In an effort to contain costs, close to a third of retail firms are reducing their advertising spending, cutting back on strategies geared toward attracting and retaining customers. This withdrawal of investment in growth and marketing initiatives is symptomatic of the wider issues of low confidence within the sector, with potential knock-on effects for broader economic activity, including employment and capital investments.
The façade of operational normalization in the face of such economic headwinds is crumbling as the retail sector's resilience is tested. Godwin emphasizes that a failure to address these issues could lead to harmful repercussions for the Australian economy, especially as retailers reconsider their future investment and hiring strategies in light of uncertain trading conditions.
The Australian Prudential Regulation Authority (APRA) has announced a significant policy change aimed at mitigating financial risks associated with high debt-to-income (DTI) loans. Effective from 1 February 2026, APRA will implement a 20% cap on new loans where the borrower's debt exceeds six times their income. This measure applies to both owner-occupied and investor loans, reflecting a proactive approach to maintaining financial stability in the housing market. - read more
According to Canstar's latest Consumer Pulse Report, the cost of housing remains the foremost financial concern for Australians as they head into 2026. Despite three cash rate cuts in the past year, 21% of Australians identify housing expenses, including mortgages and rents, as their primary financial worry. This marks the fourth consecutive year that housing costs have topped the list of financial concerns, with the percentage more than doubling over the past five years. - read more
The Australian personal loan market is undergoing a significant transformation, with digital lenders now accounting for over 40% of new loan originations. This shift is driven by the rapid digitalisation of loan processes, offering borrowers faster approvals and broader eligibility criteria. - read more
Financial hardship occurs when an individual is unable to meet their financial obligations due to a variety of circumstances. This could stem from a loss of income, unexpected expenses, or rising living costs that outweigh financial resources. - read more
Embarking on a journey towards financial stability begins with the mastery of personal budgeting. It's the cornerstone of sound money management, where every dollar is allocated purposefully, paving the way for a future free from the shackles of financial stress. In this all-important first step, individuals learn the fine art of balancing their earnings with their expenditures, a fundamental skill for anyone looking to navigate their finances with confidence. - read more
Have you ever heard the term loan refinancing and wondered what it actually means? Simply put, refinancing a loan involves replacing your current loan with a new one, typically to take advantage of better terms, such as lower interest rates or different repayment conditions. - read more
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Knowledgebase
Mortgage Document: The physical contract agreement that a Mortgagee (lender) enters into with a Mortgagor (borrower) outlining the precice terms of a mortgage loan.
