Four in five small business owners say unavoidable costs have squeezed their margins over the past 12 months.

That’s the picture from Prospa’s latest YouGov research, which surveyed 500 owners and decision makers of Australian small businesses in late July and early August. Fuel, insurance and energy top the list of costs putting on the pressure.

Most owners have already acted, and while their solutions vary with the industry, how long a business has been trading and whether it has staff, many of them cost nothing to put in place.

Owners are trimming the costs hiding in plain sight

Cutting non-essential costs and overheads is the most common response to rising costs, with 42% of owners trimming spending their business can do without. In 2026, businesses that aren’t sole traders are more likely to be cutting back.

For larger operations, which usually have more contracts, subscriptions and services, that means more places to find savings. If you work on your own, there are fewer accounts to go through, but every dollar you save goes straight back into your pocket.

The quickest savings tend to sit in charges that renew on autopilot. To find yours:

• Pull the last three months of bank and card statements and highlight every recurring charge.
• Sort them into essential, useful and forgotten, then cancel the forgotten ones.
• Call the suppliers behind the essentials and ask for a better rate, a cheaper plan or a discount for a longer commitment.
• Combine smaller orders where you can, so delivery fees and minimum-order charges come up less often.

Tradies are building rising costs into their quotes

What happens to a job quoted in March when the work doesn’t start until September? If tiles, fittings and fuel cost more by then, you wear the difference.

Faced with rising costs like these, more than a third of owners are raising prices to protect their margins. In building and trade, where fuel and materials go into almost every job quoted, half of businesses are upping their quotes. Raising your prices helps with jobs you haven’t quoted yet. For work that won’t start for weeks or months, these changes keep rising costs from landing on you:

Keep quotes valid for a shorter period. A quote that stays open for months can lock you into a price set before your suppliers raise theirs. A 30-day validity period, for example, keeps your price closer to what materials cost when the work begins.

Add a cost adjustment clause to longer jobs. For work that runs over several months, or starts well after you quote, a clause that lets you adjust the price if materials or fuel rise sharply keeps the risk from sitting entirely with you. Ask your accountant or a lawyer to check the wording.

Give regular customers notice of a price rise. Telling them a month ahead, and explaining which of your costs have gone up, gives them time to plan and causes less friction than a higher figure turning up on their next invoice.

Some owners are holding their prices for now and absorbing the increases themselves. If that’s you, a cash flow forecast can show what that’s costing you each month, and if and for how long it’s sustainable. If you’re a sole trader, run the same check to make sure your hourly or day rate covers the current cost of fuel, insurance and other expenses that might have increased since you set it.

Small businesses are hunting for value in what they already spend

One in five owners are actively looking for new ways to get value or rewards from what they already spend. Across all owners, the most common way to get more from existing spend is a business card that earns points, cashback or rewards. Next come rebates or loyalty benefits negotiated directly with suppliers, used by 18% of businesses in white-collar industries compared with 8% in blue-collar industries.

Only a small share of owners route business-to-business payments through platforms that offer rewards, though newer businesses are more likely to do it than established ones. Given the option, two in three owners say they would put unavoidable overheads such as freight, energy and inventory through one.

A rewards card only adds value if what you get back is more than what the card costs you, so check three things before relying on one:

• The annual cost. Add up the annual fee and any other charges, such as fees for extra cardholders or for earning points at a higher rate.
• What you’ll actually redeem. Points you never use, or that expire, don’t offset any of that cost, so base your sums on the rewards you’re likely to claim, such as flights or cashback.
• How much of your spending can go on it. The larger and more regular the bills you can pay by card, like fuel, freight, stock and utilities, the faster points build up.

Employers are juggling cash flow to keep up with Payday Super

More than half of businesses that aren’t sole traders have changed how they manage cash flow since Payday Super began. To cover these payments, the most common solution has been drawing on cash reserves, which is quick to put in place but leaves less for the next unexpected bill.

Others have cut back or delayed other spending, protecting cash in the short term, but potentially pushing back equipment, marketing or hiring. A smaller group have turned to, or plan to use, external funding, which protects reserves and plans in exchange for repayments to budget for.

Most have kept up with the new deadlines, though some have already missed at least one. To make super easier to manage, set it aside each time you run payroll, so the money is already there when it’s due. If a deadline has slipped, check that your payroll software and super payment process are set up for the shorter turnaround, then ask your accountant where the delay is coming from. For a closer look, a business owner, an accountant and a finance broker share how employers are adjusting to Payday Super.

If you’re a sole trader with no staff, you don’t have to pay super guarantee for yourself, though you can choose to make personal super contributions.

Businesses with a buffer are better prepared for what comes next

Almost a third of owners have less than a month of expenses put aside, or nothing at all.

That leaves little room when a bill arrives early or a customer pays late. The moves other businesses are making, from cancelling forgotten subscriptions to updating prices that no longer cover costs, all free up cash, and putting some of it aside turns those savings into a buffer.

A common rule of thumb is to hold enough to cover three to six months of expenses. The right amount for your business depends on how quickly customers pay you and how much your costs move from month to month.

Building a buffer that size takes time, and a business line of credit can act as a backup while yours grows.

Thank you to Prospa for the original article