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Prepared by Sydney Collect
Updated June 2026 · Sources: 2026 Debt Collection Report §5 & §6, Atradius AU 2025, ASBFEO, PTRR
Key stat: According to the Atradius Payment Practices Barometer Australia 2025, large Australian businesses take an average of 58 days to pay their suppliers — 6 days longer than small businesses. For transport operators on 30-day terms, this means your largest customers are routinely paying late by design. (Atradius AU 2025; ASBFEO: 69% of businesses not paid within 30 days)

The freight cash flow trap

Transport is a working-capital business. Fuel is paid at the bowser. Driver wages are paid weekly. Tyres, tolls, and maintenance are paid on delivery. But freight invoices — the revenue that covers all of it — are paid 30, 60, or 90 days after the load is delivered, if they are paid on time at all.

According to the Australian Small Business and Family Enterprise Ombudsman (ASBFEO), 69% of Australian businesses are not paid within their contracted terms. For transport operators whose operating costs are largely fixed and immediate, each day a large shipper delays payment is a day you are effectively financing their working capital.

A formal letter of demand disrupts this cycle. Where a polite chase call goes to voicemail, a lawyer-backed letter addressed to the accounts payable manager — citing the invoice number, due date, and your legal intention — escalates the matter out of the payment queue and into the shipper's legal review. Most overdue freight invoices are resolved within 7–21 days of a letter of demand being received.

Transport & logistics insolvency — sector risk profile

The Sydney Collect 2026 Australian Debt Collection Report analyses AFSA insolvency statistics across all ANZSIC divisions. The transport picture:

MetricTransport, Postal & WarehousingNational average
Operating businesses249,289—
First-time EXAD appointments (FY24–25)511—
Insolvency rate (per 1,000)2.053.42
Relative to national average0.6×1.0×

Transport is a below-average-risk sector — your debtor is more likely to be solvent than the national average suggests. The problem is not insolvency risk. The problem is payment behaviour: large shippers exploit the power imbalance to enforce extended payment cycles on transport subcontractors who have no leverage to push back — until a formal letter of demand is sent.

Named slow payers in transport: the PTRR data

The Commonwealth Payment Times Reports Register (PTRR) requires large Australian businesses to disclose how long they take to pay small business suppliers. Two transport entities appear in the 2026 Report's Late Payer Index:

EntitySub-sector95th-percentile days to pay
LATAM AirlinesAir freight / aviation184
Hull 2227 (Shipping)Sea freight165

Source: Commonwealth PTRR statutory disclosures (via 2026 Debt Collection Report §6). Figures represent each entity's own disclosed 95th-percentile time to pay small business suppliers.

The industry median 95th-percentile payment time across 167 large transport entities is 54 days — not the worst sector in Australia (construction tops that at 67 days), but well above the 30-day terms most transport subcontractors contract on. Acting at 30 days past due is materially better than waiting to 90 days — both in terms of recovery probability and cash flow impact.

Timing matters: act at 30 days, not 90

Section 8 of the 2026 Debt Collection Report analyses recovery outcomes across the full debt collection ladder:

StageRecovery rateTypical timeline
Letter of demand (LOD)55–70% of debts where internal reminders failed7–21 days
Managed agency recoveryAdditional 15–20% of remaining30–90 days
Court action (NCAT / Magistrates)Judgment almost certain if solvent60–180 days

For transport operators, every day of delay on a $10,000 overdue freight invoice is approximately $2.75 in forgone interest (at 10% p.a.). More importantly, at 30 days past due, the debtor is still solvent, still operational, and still has the cash. At 90 days, you risk financial distress in the debtor's business — or simply a debtor who has already moved to wind down and pay creditors selectively.

Transport & logistics freight debt types we recover

Debt typeExamples
Freight invoicesRoad, rail, air, or sea freight services — unpaid after delivery
Haulage & cartageBulk haulage, heavy vehicle transport, long-haul contracts
Courier & last-mile deliverySame-day courier, parcel delivery, last-mile services
Warehousing & 3PLStorage fees, pick-and-pack, third-party logistics invoices
Fuel levies & surchargesDisputed or withheld fuel surcharges after contractual delivery
Detention & demurrageContainer, vehicle, or vessel detention fees at client sites
Ready to act? Your debtor almost certainly can pay — transport debtors are below-average insolvency risk. Acting at 30 days gives you the best recovery odds. Send a letter — $29

Frequently asked questions

Can I recover unpaid freight invoices with a letter of demand? ▼
Yes. A letter of demand is effective for unpaid freight, cartage, haulage, and logistics invoices. It creates a formal legal record, signals to the debtor that you are prepared to escalate, and typically produces payment within 7–21 days where internal reminders have failed.
Can I exercise a lien on goods for unpaid freight? ▼
Under common law and some state legislation, a carrier has a lien over goods for unpaid freight charges. A letter of demand should be sent before exercising a lien to create a clear legal record and demonstrate good faith. Holding goods without proper authority can expose you to liability — seek legal advice before doing so.
The shipper says the delivery was late. Can they withhold payment? ▼
Only if your contract contains a liquidated damages or withholding clause tied to delivery time. In most standard freight contracts, late delivery gives rise to a potential counterclaim — it does not entitle the shipper to withhold the full invoice amount. The letter of demand separates these issues and demands payment of the undisputed freight amount.
What about disputed fuel surcharges or detention fees? ▼
Fuel levies and detention charges are contractual. If your rate schedule includes a fuel surcharge formula or detention fee clause, a letter of demand citing the exact calculation and the contracted terms is enforceable. Disputes about the formula itself would need to be resolved separately.
How long do I have before a freight debt expires under Australian law? ▼
In most Australian states, the limitation period for a contract debt is 6 years from the date the invoice became due. In NSW this is set by the Limitation Act 1969 (s14). However, acting early is strongly advisable: the 2026 Debt Collection Report shows recovery rates drop materially after 90 days. Use the limitation checker to verify your specific debt timeline.

Sources