Rising costs, fuel prices and fire-related closures are pushing some regional Victorian small businesses to the brink, with owners saying they are struggling to stay open.
The Reserve Bank lifted interest rates by 0.25 per cent on March 17, adding to the pressure on already-struggling businesses
Since then, some operators say fewer people are going out and spending big.
In the south-west Victorian town of Timboon, near the Great Ocean Road, Schulz Organic Creamery and Cafe has “reached a tipping point”.
The company said that, after two years of drought and rising costs, it needed tourist visitation more than ever, as local support alone was no longer enough.
“Our family cafe will fail if we don’t do something about it,” it said in a social media video.
“We now need tourists to survive.”
The business’s general manager, Jessica Beer, said several fronts on the Great Ocean Road had been “hit from a lot of different angles”.
Jessica Beer said small businesses are facing “multiple problems, which require multiple solutions”. (Supplied: Jessica Beer)
“We had some local fires, which significantly decreased the foot traffic and the tourism,” she said.
“The current challenge we are all facing now is fuel prices — we are likely to see a drop in travelling.”
She said the impacts were far-reaching, particularly as a business running a cafe alongside a farm, where diesel machinery and transport costs are essential.
“We have just received a 22 per cent increase effective immediately just on our packaging,” she said.
Ms Beer said it was also tough on young locals, who lost shifts.
Staff cuts
In Kyneton, the Little Swallow Cafe announced it had let go of six staff and reduced opening hours as a result of financial pressures.
“Sadly, turnover at the cafe has been smashed since the fuel supply crisis and the increase in interest rates,” the post reads.
“If the RBA wanted to dampen discretionary spend then they have well and truly accomplished that and more.
Little Swallow cafe owner Daniel Richards has had to cut down business hours to stay afloat. (ABC Central Victoria: Tyrone Dalton)
“To the four members of the RBA board that voted against the latest rate rise, then thank you for trying.
“To the five that voted for it, then you need to get your head out of your a***, come down from your ivory tower, and ask what’s going on in the real world
“To the six staff we have had to let go, we are deeply sorry and appreciate everything you have contributed to the business.”Trying to stay afloat
Bob Robertson, who runs the Mount Tarrengower General Store in Maldon in Central Victoria, said his business had diversified from its origins as a bookshop.
However, it was still struggling.
Bob Robertson has adapted and diversified his business to remain afloat. (Supplied: Bob Robertson )
“I’m contributing out of my savings to stay afloat … it’s just been one thing after another,” Mr Robertson said.
“The recovery from COVID was very slow and the economy has been slow as well for the last couple of years, and now petrol prices are reducing the number of people coming to Maldon.”
Bob Robertson said fewer tourists are visiting Maldon due to rising fuel costs. (Supplied: Bob Robertson )
He said even small purchases were being reconsidered.
“People will walk in, and the kids will pick out a couple of two-dollar books, and the [parents] say ‘not today’.”
Federal support
On Wednesday, federal Small Business Minister Anne Aly announced support measures for small businesses, acknowledging the “economic fallout of the war in the Middle East is affecting everyone”.
The measures include temporary concessions from the Australian Taxation Office for businesses unable to meet tax obligations due to fuel supply issues.
Certain compliance actions and debt collection will also be paused.
The small business responsible lending obligation exemption will also be extended for another 10 years, aimed at improving access to credit.
The Australian Chamber of Commerce has been contacted for comment.