Marty Corboy explains why regional businesses are disadvantaged compared to their city counterparts. Photo: Supplied.
On Friday last week, I, along with 11 fellow employees, lost my job.
A local Wagga-based food distribution business, after 45 years servicing the Wagga region, has gone into voluntary liquidation.
With its humble beginnings on an industrial lot in Wagga, it is not the first regional business to close, and it will not be the last. But when a business like this disappears, the loss is not just commercial.
Devastating impact of regional business closures
When a small regional business closes, the damage does not stop with the owner. Staff lose wages. Customers lose options. Local clubs lose sponsors. Young people lose training pathways. Suppliers lose accounts. Families lose stability. Towns lose resilience.
That should force a bigger question: are we serious about keeping small businesses alive in regional Australia, or are we only prepared to praise them after they are gone?
For years, regional small businesses have been described as the backbone of the economy. They employ locals, train young workers, sponsor football clubs, donate to school raffles, supply pubs, cafes, clubs, farms, trades and community organisations, and keep money circulating close to home.
Yet the structure around them is fragile.
Unfair playing field
Small operators are expected to compete against larger corporate businesses with greater buying power, deeper capital, centralised systems, cheaper finance and more room to absorb shocks. At the same time, local businesses face rising wages, freight, fuel, insurance, rent, energy, compliance costs, late payments and shrinking margins.
In regional areas, those pressures are magnified. Distance costs money. Smaller markets limit economies of scale. Staff shortages hit harder. Losing one major customer can be the difference between survival and closure.
And yet policy often treats regional small businesses as though they operate under the same conditions as large businesses in Sydney, Melbourne or Brisbane.
They do not.
A better structure does not mean another grant program with a complicated application form, a glossy announcement and a photo opportunity. Nor does it mean another workshop telling exhausted business owners to “innovate” while they are drowning in cashflow pressure.
It means practical reform.
Wagga’s Hog’s Breath Cafe was one of many small businesses to close in recent years. Photo: Oliver Jacques.
What needs to change
First, small regional suppliers need stronger protection from late payment.
If a small business supplies a large company, council, school, hospital, government agency or publicly funded organisation, it should not have to wait 30, 45 or 60 days to be paid. A large organisation can survive delayed payment. A small supplier often cannot.
Australia already has the Payment Times Reporting Scheme, but reporting alone is not enough. A fairer model would require large organisations to pay small regional suppliers within seven to 14 days. Small businesses should not be forced to act as interest-free lenders to the organisations they supply.
Second, regional procurement needs real weight.
Governments, councils, schools, hospitals and large institutions should be expected to consider the local economic impact of where they spend money. Cheapest is not always cheapest if the result is lost jobs, lost service and a weaker regional economy.
NSW already has a Small and Medium Enterprise and Regional Procurement Policy, which allows government agencies to directly engage SME or regional suppliers for certain goods and services. That is a useful start, but the principle should go further.
A Wagga business employing Wagga people should not be treated as interchangeable with a city-based or multinational provider simply because one quote is slightly cheaper. Public and institutional spending should consider local employment, supply reliability, community benefit and whether money continues circulating in the region.
When public money is spent, the question should not only be, “What is the lowest price?”
It should also be, “What does this purchase strengthen?”
Third, regional small businesses need a resilience allowance.
Businesses outside the major cities carry structural costs that city-based policy often overlooks: distance, freight, fuel, smaller markets, labour shortages and thinner margins.
A regional small business resilience allowance could help local operators invest before they are forced into crisis. It could support equipment upgrades, freight and fuel costs, cold storage, compliance requirements, insurance increases, apprenticeships, local employment and succession planning.
Existing measures such as the instant asset write-off are useful, but they are broad. Regional businesses need something more targeted and permanent — something that recognises that a distributor in Wagga, a mechanic in Griffith, a manufacturer in Junee, or a food supplier in Albury is not operating on the same playing field as a metropolitan competitor.
Because when a regional business closes, the damage does not stop with the owner.
Solutions needed, not slogans
The closure of a regional business is not always the result of poor management or lack of effort. Often, it is the result of a system that leaves small operators exposed and underpowered.
They are expected to provide local employment, local service, local flexibility and local loyalty while competing against larger businesses with scale, capital and procurement advantages they can rarely match.
That is not a level playing field.
We also need to stop pretending consolidation is always efficiency.
When local suppliers are replaced by larger corporate providers, something important is lost. The relationship is lost. The flexibility is lost. The local accountability is lost. The person who knows your business, your town and your circumstances is replaced by a portal, a call centre, or a territory manager passing through every few months.
That is not progress.
It is dependency dressed up as efficiency.
If we want regional Australia to remain strong, we need more than slogans about backing small business. We need payment rules that protect cashflow, procurement rules that genuinely value local suppliers, and tax and investment settings that recognise the extra cost of doing business outside the major cities.
Because when a small business closes in a regional town, it is not just a private commercial event.
It is a community loss.
Small business in regional Australia does not need pity.
It needs a fairer structure.
Original Article published by Marty Corboy on Region Riverina.
