August 2025 was steady, but caution is creeping in.
Sales are up in nominal terms, but adjusted for inflation turnover is flat. Growth is coming from price, not volume. Margins remain squeezed as input costs linger.
Credit is tight. Total debt climbed for a second month, and companies are leaning on leverage to manage working capital. Arrears are stable, around 3.8 percent at 60 days, steady at 90 days. Cash-flow stress is not spiking, but it is persistent. Days Sales Outstanding are ticking up across trade and project suppliers, signaling slower payments and longer collection cycles.
Construction is showing early signs of footing. Dwelling consents are nudging higher and aggregate sales are steady. Arrears remain high, with Wellington again the trouble spot. Manufacturing and Food & Beverage are holding firm. Plumbing and Electrical are seeing repayment pressure return. Retail credit performance is holding despite lower sales. Careful management is helping offset softer demand.
Insolvency tells a sharper story. Winding-up applications edged above last August, but the real eye-opener is the Inland Revenue Department. They account for 78 percent of filings, 93 of 119. That is 29 months in a row where the IRD leads all other creditors combined. Overdue tax is no longer being ignored.
Corporate insolvencies are above 2023 levels. Personal insolvencies are up for three months running. Households and smaller operators are not growing; they are just surviving.
Regionally, the North Island lags the South on construction and arrears. The South Island’s commercial pipeline is steadier and repayment behavior is more consistent. The North struggles with weak project demand and tighter liquidity.
August paints a picture of surface stability with pressure underneath. Businesses are adapting, but rising debt, slower collections, and tighter IRD enforcement will test resilience heading into Q4.
Those who stay on top with smarter credit monitoring, proactive engagement, and disciplined risk management will be the ones who perform best in the months ahead.
Read the full CreditWorks Insights report for the full story and practical strategies to protect your business through 2025 and beyond.
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Please note that due to the vast amount of data required to produce these reports, most of which is accessed from a multitude of external sources, there is an inevitable time delay in their generation. However we prefer to defer their publication in favour of ensuring greater accuracy.