Posted on: May 8, 2025
Is Trumponomics Tightening Your Cash Flow? Here’s Our Guide
Since U.S. President Donald J. Trump’s return to the White House in January, global markets have been on edge.
Late last month, a senior policy adviser from the Australian National University wrote about the dismantling of the foundations of the international order and U.S.global leadership. The changes afoot seem seismic.
You’ve likely heard about the roller coaster fluctuations of the US S&P 500 and our nation’s ASX 200, reflecting investor anxiety over renewed trade tensions. Both stock markets rebounded in late April, fuelled by hopes of a slightly more stable policy outlook.
While headlines focus on Wall Street and large corporations, the ripple effects are being felt closer to home. For Australian small businesses, the fallout includes increasing economic uncertainty, tariff-driven supply chain disruptions, wavering consumer confidence, tighter lending conditions, and rising insurance premiums.
Let’s unpack what this means for your business—and how to stay resilient in uncertain times.
The Impact on Small Businesses in Australia
Trump’s aggressive tariff stance — particularly the proposed three-digit levy on Chinese imports—has disrupted global supply chains. Australia, as a key trading partner, isn’t immune. In late April, Australian diplomats were still seeking exemptions from the 10% tariffs on Australian exports, especially since we import more from the U.S. than we send there.
Many local exporters and importers are already feeling the squeeze as costs rise and demand changes.
Meanwhile, superannuation balances have taken a hit. For small business owners with self-managed super funds (SMSFs), market downturns could erode retirement savings and impact linked insurance coverage.
On the financing front, interest rates remain high. As of April 2025, small business loans are averaging 8.99% for unsecured finance and 6.45% for secured equipment loans. While the Reserve Bank has trimmed the cash rate to 4.1%, relief is slow to materialise.
Consumer confidence remains fragile. The ANZ-Roy Morgan index dipped to 84.2 in mid-April, reflecting cautious spending behaviour. Retailers, cafés, and service providers are noticing the pinch as customers tighten their belts.
How Insurance Fits into the Picture
Even before Trump returned to office, insurance costs were surging. Some small businesses have seen premiums jump by 30% year-on-year, particularly for commercial property, liability, and cyber cover. The Australian Small Business and Family Enterprise Ombudsman has flagged insurance as one of the biggest upfront costs for SMEs.
As claims rise — due to natural disasters, inflation, global trade disruptions, and economic instability, this could mean stricter exclusions or reduced coverage limits, especially in high-risk sectors. Be mindful that it’s a good time to audit your cyber policy for supply chain interruption clauses – we can help guide you with that.
If your income protection or life insurance is linked to your super, a declining balance might affect your cover. It’s worth checking whether your policy still meets your needs. You might need separate income protection outside of your super to avoid erosion.
As well, SMEs continue to scrutinise how they secure insurance, with those working through brokers doing so for the expert knowledge, quality of service, and personalised support during claims, according to a survey.
What Small Business Owners Should Do Now
Here’s how to position your business for whatever comes next:
- Review your insurance policies: Ensure your coverage is tailored to meet your specific needs and requirements. It’s important to reassess your policies whenever your business changes or before renewal to avoid gaps in protection.
- Check loan and financing options: With interest rates fluctuating, businesses with variable-rate loans may need to lock in fixed-rate options to avoid cost increases.
- Diversify suppliers and markets: If your business relies on international trade, consider alternative suppliers or domestic markets to hedge against tariffs and disruptions. The Australian government has introduced a $1 billion zero-interest loan program to assist export-focused companies in exploring alternative markets, aiming to reduce reliance on U.S. trade. This initiative is part of a broader strategy to strengthen ties with countries like India, the UAE, and the European Union.
- Buy Australian procurement: The Federal Government has set aside $5M in grants for SMEs to rebrand for local markets. Consumers are on board with 91% preferring Aussie-made goods.
- Monitor consumer trends: Adjust your pricing and marketing as spending patterns evolve. Many businesses find success by aligning with causes their customers care about and making that connection visible throughout the customer journey.
Uncertainty Is the New Normal—Be Prepared
Global politics might seem far removed, but they affect everything from your insurance costs to customer numbers. In times like these, staying agile matters.
As your broker, we can review your policy, identify any gaps, and ensure your cover suits your risk profile. Whether you run a shopfront, warehouse, franchise, or unit block, the right protection makes all the difference. Let’s make sure your business is ready for what’s ahead.
