Small Businesses Are Dying: A Nation at Risk

A Silent Crisis Sweeping the Nation

From suburban streets to bustling CBD alleyways, Australia’s small businesses are quietly shuttering their doors. These aren’t faceless corporations or multinational brands we’re losing; they are the local cafés where neighbours meet, the butchers who know your order by heart, the boutique clothing stores that stitched our identities for decades. Their closure represents more than economic strain—it signals a collapse in community, identity, and resilience. Small businesses are dying, and if we don’t act, they will not rise again.

Chapter 1: The Numbers Don't Lie

In the past financial year, nearly 363,000 Australian businesses closed their doors—a shocking 14% of the total business population. More than 6,700 businesses in New South Wales alone entered administration in the last 11 months. According to CreditorWatch, the rate of business insolvency across sectors has reached a 10-year high, with expectations that the worst is yet to come.

Industries like hospitality and retail are taking the brunt of it. These sectors, long the heartbeat of local enterprise, are crumbling under the weight of compounding pressures. Cafés, pubs, independent grocers, salons, and craft breweries—the cornerstones of community life—are becoming relics.

This isn’t just a downturn. It’s a decimation.

Chapter 2: Anatomy of a Collapse

What caused this freefall? The answer isn’t singular, but rather a mosaic of challenges that converged into a perfect storm.

Economic Pressures

Rising inflation, high interest rates, and tighter credit access have made it nearly impossible for SMEs to sustain operations. Supply chain disruptions and higher input costs have slashed margins, while consumer spending is in sharp decline.

Rental and Property Costs

Leasing costs in commercial precincts, especially in major cities, have soared. Many small businesses are locked into leases negotiated pre-pandemic, paying rates that no longer reflect foot traffic or revenue.

Labour Shortages and Wage Pressures

While wage growth is necessary and overdue, it’s creating untenable costs for businesses already on the brink. The pandemic and immigration slowdowns have created labour gaps that are yet to be filled.

Digital Disruption

The acceleration of online retail has left many physical stores struggling. Lacking the capital or know-how to compete digitally, many businesses are caught in limbo.

Policy Paralysis

While well-intentioned, government initiatives often miss the mark. Access to grants remains difficult, red tape burdens persist, and regulations seem designed with big business in mind.

Chapter 3: The Faces Behind the Closures

This crisis isn’t abstract. It’s deeply personal.

• Curly Lewis Brewing Co. in Bondi, a beloved local brewery, collapsed under $8 million in liabilities.

• Jeanswest, a retail icon with roots dating back to 1972, shuttered its final 90 stores after a failed rescue attempt.

• Mosaic Brands, which operated 715 fashion outlets, closed entirely in April 2025, leaving thousands jobless.

But for every high-profile name, there are hundreds of quiet losses. The family that ran a dry-cleaning business for 30 years. The immigrant couple who sold fresh produce at the corner deli. The young entrepreneur who risked everything on a dream that drowned in debt.

Behind every closure is a story of risk, resilience, heartbreak, and hope.

Chapter 4: The Domino Effect

When small businesses die, the impact ripples far beyond their four walls.

Job Losses

With SMEs accounting for over 97% of all Australian businesses and employing more than 44% of the workforce, these closures mean mass job losses. But it’s not just a number—it’s livelihoods, routines, and aspirations upended.

Declining Local Economies

Closed shops mean empty streets. Empty streets mean reduced property values, declining council revenues, and a loss of social cohesion.

Cultural and Social Loss

Small businesses are culture-bearers. They reflect local identity, preserve traditions, and foster daily human connection. Their death erodes the soul of our communities.

Chapter 5: A Failure to Support

Government and institutional support have often been too slow, too complex, or too conditional. While JobKeeper helped during the pandemic, the post-pandemic stimulus hasn’t filled the vacuum. Meanwhile, large corporations are absorbing market share while shedding accountability.

Bank lending has become tighter, risk-averse, and increasingly bureaucratic. Many business owners are turning to private lenders out of necessity, not choice, often at higher cost and under greater stress.

Policy makers have failed to create a regulatory and financial environment where small businesses can adapt, survive, and grow.

Chapter 6: What Must Be Done

The solutions aren’t simple, but they are necessary.

1. Tax and Regulatory Reform

Simplify business taxes. Reduce compliance costs. Create tiered regulation based on business size.

2. Access to Capital

Expand SME access to affordable credit through partnerships with ethical private lenders. Incentivise banks to lend to small businesses.

3. Digital Transition Support

Fund digital upskilling programs and e-commerce infrastructure grants for local retailers.

4. Rent Relief and Zoning Incentives

Offer landlords tax offsets to reduce rent for SME tenants. Reform zoning to encourage mixed-use development with accessible commercial spaces.

5. Local Procurement Policies

Encourage government departments and corporates to prioritise procurement from local and small businesses.

6. Public Awareness Campaigns

Launch a national "Buy Local" campaign. Remind Australians that where they spend their dollar matters.

Chapter 7: Why It Matters

Small businesses are the heartbeat of Australia. They represent everything we value: risk-taking, creativity, diversity, resilience. They employ our friends, sponsor our kids’ sports teams, and greet us by name.

Losing them means more than fewer options for coffee or shopping. It means losing our sense of place, our sense of belonging. It’s a cultural collapse masquerading as economic decline.

If we don’t rally to save them, we risk becoming a nation of franchises, delivery apps, and empty main streets.

Rebuilding the Backbone

This is not a time for apathy. We stand at a precipice. The death of small business is not inevitable, but it is imminent unless action is taken.

As Australians, we pride ourselves on mateship, on giving everyone a fair go. That value must now extend to the small business owner.

Support them. Shop with them. Speak up for them. If we lose them, we lose far more than commerce. We lose community.