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New Zealand is facing a significant upswing in business failures, with the latest Companies Office statistics revealing insolvency levels that have not been seen in more than a decade. The steady climb in liquidation and receivership figures, which began in the wake of the COVID-19 pandemic, has now accelerated, signalling a challenging period ahead for many sectors of the economy.

In July 2025 alone, 236 companies entered liquidation, six were placed in receivership, and two entered voluntary administration. While over 5,000 new businesses were registered during the month, this positive figure is offset by the high number of company removals from the register, an indication that many enterprises are struggling to remain viable in an increasingly difficult trading environment.

The construction industry remains one of the hardest hit. The sector continues to wrestle with escalating costs for materials, labour shortages, tight profit margins, and softening demand for new projects. The hospitality sector is also under considerable pressure, having featured prominently in last year’s liquidation data. Rising operating expenses, shifting consumer spending habits, and ongoing competition are challenging restaurants, cafes, and accommodation providers; many of which are still recovering from the impact of pandemic-related restrictions.

Against this backdrop, the likelihood of customer insolvency or late payment is growing, creating a ripple effect that can disrupt supply chains and put pressure on cash flow across multiple industries. This is where trade credit insurance has become increasingly critical. By covering the risk of non-payment due to insolvency or protracted default, it helps safeguard revenue, stabilise cash flow, and provide businesses with the confidence to continue trading, even when market conditions are uncertain.

The current environment leaves little room for complacency. With insolvencies on the rise, being prepared is no longer a competitive advantage, it is a necessity. Proactive measures, from tighter credit controls to comprehensive risk transfer solutions, will be essential for businesses determined to navigate the challenges ahead and emerge stronger on the other side.