Big brother puts squeeze on business

Make no mistake about it, more and more small and medium businesses will start to disappear from the WA market, because big business is squeezing out the little guys.

That’s the opinion of KEA Advertising’s Keith Ellis, who says small business operators struggle to pay taxes, especially the amount of payroll tax, which he described as disgusting.

“We end up getting squeezed out because we are not big enough – we cannot beat them, we cannot beat big brother,” he said.

Mr Ellis gave SME sector representatives his account of being squeezed out by big business.

“We run an importing business and supply the discounting industry interstate,” he said.

“We’re talking the Crazy Clarks, the Go-Los. One company that has 150 stores decided they were overstocked and knocked us out.

“We lost $200,000 not in sales but bottom line. Hallmark was allowed to stay in because they buy their way in.”

A similar situation was that, of the 470 liquor stores in WA, Coles and Woolworths own 158. The 312 independents are not allowed to trade on Sundays and as a result are pushed out.

“The same thing happened when Bunnings went to Victoria; I think about 83 hardware stores closed,” he said.

The Bra Bar’s Don Sinclair said he found himself in a similar situation trying to compete in a marketplace with specialist bra store chains.

“They look like boutiques but they’re buying stuff from China, which is so damn cheap and it is getting quite good unfortunately,” he said.

Mr Sinclair said low buying costs allowed chains to lease stores in popular precincts and make big profits, even if they sell at a reduced retail price.

But Mr Ellis said the key was for SMEs to focus on niche business, niche markets and exporting.

“We also have to network harder. Local chambers provide outstanding networking opportunities, so people need to get involved and learn from other people’s successes and experience,” he said.

“We all have to work together and help each other out.”

The Local Chambers of Commerce and Industry executive director Charles Bellow said people who join the non-profit organisation are looking to benefit the whole business community and not just themselves.

“And these people are the ones who succeed,” he said.