Construction is still Australia’s insolvency hotspot. Why?

Construction continues to lead Australia’s company insolvency figures.

ASIC reported that 12,819 companies entered external administration during the first 11 months of the 2025–26 financial year. Almost one in four appointments, 24.4%, came from the construction industry.

But how can an industry with so much work available continue to lose so many businesses?

The answer is often cashflow.

Construction businesses regularly need to pay for materials, labour and subcontractors before receiving the next progress payment. Add rising costs, tight margins, delayed approvals and disputed variations, and even a busy business can quickly find itself under pressure.

A full pipeline does not always mean there is enough money in the bank.

When one payment arrives late, the business still needs to cover wages, suppliers and the costs of keeping other projects moving. The longer the delay, the more pressure spreads across every job.

This is why payment structure matters just as much as the amount being charged.

Clear milestones, documented variations and transparent approval processes can reduce confusion. More importantly, knowing that the money for a project has been committed before work begins gives businesses greater certainty about what they will be paid and when.

Witzer allows project funds to be securely committed upfront and released as agreed milestones are completed. Both parties can see where the money sits, what has been approved and what happens next.

Construction insolvencies will not be solved by one platform. But improving the way projects are funded, managed and paid is an important place to start.