Top Reasons Rural Businesses Fail and How Yours Can Succeed

Jenna Santos | Windmill Events & Promotions
Reasons Rural Businesses Fail

Top Reasons Rural Businesses Fail and How Yours Can Succeed

Have you noticed the increasing number of vacant shops lining the main streets of our country towns? Do you ever wonder about the reasons rural businesses fail? And more importantly, how yours can succeed.

If our retailers continue down the path of imminent death, the tumble weeds won’t be far behind to take their place.  Although a little western touch may just add some charm to our Wheatbelt towns.

It feels as though our towns are dying, and many are definitely experience declining and ageing populations, however you may be interested to know many industries are actually growing. And compared to the city folk, our businesses aren’t doing so bad.


According to our friends at the Australian Bureau of Statistics there are roughly 4600 business exits each year in rural, regional and remote WA, which only accounts for around 9.83% of the total number of RRR businesses compared to the 13.33% in Perth. Maths may not be my strongest subject, but even I can see that’s not so bad. Furthermore, there are around the same number taking their place; in fact there are slightly more entries than exits per year. The Wheatbelt isn’t doing so well, with more exits than entries, and the total number of businesses heading on a downward trajectory.

Regardless of what the statistics say (though I do love a good statistic), we all know running a business is hard. The challenges keep coming like flies in the springtime; impossible to avoid and almost certain to drive you mad.


Businesses disappear from rural areas for many reasons, and complete financial failure is actually fairly rare. In fact, according to ABS, of the 1406 business exits in 2019, only 38 people entered business related personal insolvencies.

Farms are getting bigger, which means the number of farming businesses is steadily declining (and with it our populations). Economic, social and environmental impacts all play a part, but farming is a hard game and eventually, I suppose, we all want to retire. It is therefore not surprising that agriculture is one of the most rapidly declining industries. Transport, Postal and Warehousing, Retail Trade and Construction businesses are also disappearing, thus explaining our empty shop fronts. Many are struggling with the population trends, and others are just not making the necessary changes to survive.

If you’re looking for a career in finance however, things are looking up, with ABS stats revealing Financial and Insurances Services up 21% from 2014 to 2019. The number of Rental Hiring and Real Estate Services are up 5%, with Professional, Scientific and Technical Services, as well as Manufacturing slowly increasing.

If you’re trying to enjoy your morning coffee while there are no customers in your shop and I’ve just destroyed the moment (along with all your hopes and dreams) please keep reading. There are pretty clear reasons why rural businesses fail and more importantly, many things you can do to succeed.

Failing versus succeeding rural industries
Lack of training and education

Skilled staff shortages

Varying demand for products and services

Lack of access to funding

Business costs and overheads

Poor internet and mobile connectivity (for a high cost)

High costs of business development

Low access to marketing advice and support

As business owners, we all know there are a whole range of challenges thrown out way. But some might argue rural businesses face more challenges than their city counterparts (and I’m one of them).

Emerging digital technologies are creating so many opportunities, that are yet to be fully realised. I believe it is a really exciting time for rural areas, as it becomes increasingly possible to operate businesses and study from pretty well anywhere… with an internet connection.

As I’m writing this, I’m trying to get the hotspot on my phone to connect to my laptop, after it rudely disconnected while I was making a coffee. I love technology… when it works. But nothing angers me more than when the things that are meant to support me let me down. And I’m going to put computers, the internet and printers at the top of that list.

I know you feel my pain… because according to the Department of Regional Development only 58% of Wheatbelt businesses have broadband. 38% of Wheatbelt businesses rely on mobile wireless… and we all know how notoriously unreliable it can be.

Few challenges are insurmountable, though most are at the very least mildly irritating. Many rural business owners are savvy enough to overcome the roadblocks along the way (even if it means bulldozing through them). But aside from the usual suspects, including economic downturn and environmental impacts, many businesses struggle because they are missing one key ingredient to success…


I am glad you asked. Regional Development Australian define innovation as:

the creation and implementation of new ideas, processes, products or models which add value and lead to positive outcomes or changes.

ABS measure business innovation by:

  1. Goods or services
  2. Operational processes
  3. Organisational/managerial processes
  4. Marketing methods

Many rural entrepreneurs believe the challenges facing rural businesses are standing in the way of innovation in the Wheatbelt. However, telecommunication connectivity is improving (even though it sometimes doesn’t feel like it) and there is support out there. You are not alone!

  1. Business planning

Running a business without a plan is like driving a car without a steering wheel; you may stay straight for a while but eventually you’ll end up in the bushes.

I get it business planning is no fun. I like to think all my ideas are flawlessly brilliant, and a plan is completely unnecessary. Like other country people, I do love to wing it on occasion. But there are some things we should most definitely not wing… and I urge you to learn from my mistakes.

Research and planning is essential… no matter how brilliant and foolproof you think your concept is. And the best part is… business planning breeds new ideas, which sometimes send your business into a completely different and more sustainable direction.

Ideally you should do a lot of market research and put together a business plan before you open for business. Operations really cut into your time. But it is never too late, and always worthwhile, undertaking a business plan, and continually updating it.

If you don’t know where to begin…

2. Seek advice and support

There is a surprising amount of free (yes free) support out there if you know where to look. I’d highly recommend starting with the Small Business Development Corporation.

SBDC offer free business (including marketing) advice, templates and guides, and they also have a blog. I used some of their templates early on… and then just changed them to suit my own needs as I went along.

Business Local is a SBDC Service funded by the Government of WA, and is available through RSM. They also offer free business and marketing advice and mentoring, and will provide you with an action plan and guidance. I found them to be most helpful when I got started.

Industry associations, such as the Wheatbelt Business Network, offer professional development, business support and network events. They have a strategic growth mentoring program called WBN Grow, which is designed for established businesses. There are so many other industry groups out there to support you in your goals.

And let’s not forget the private businesses that offer great business and marketing support, including advisors and coaches.

3. Keep training

Don’t you just love to learn new things? I know I do! But I particularly love learning to become more efficient and avoid costly mistakes. Even short online courses can provide a lot of useful information and resources. After completing a business plan, you’ll know your weaknesses. Start addressing them with training. If you don’t have any give me a call.. I’ve always wanted to meet a perfect person.

Overcoming skill labour shortages can be a problem. Training good capable people may be a solution.

There are several government funded training options available, including free skills workshops across the Wheatbelt through RSM Business Local.

If you have some funds available, there are also countless courses available online. I highly recommend the Australian Institute of Management. They do online short courses covering a range of topics including communication, finance, human resources, leadership and project management. You can even do online Diplomas through AIM, at your own pace. If you prefer face-to-face then Australian Institute of Management Western Australia is another option.

And again, there are many businesses out there offering workshops and training, both online and face-to-face.

4. Collaborate

You can gain a lot from collaborating with like-minded people. Sharing ideas, learning from each others mistakes and offering support are all things to be gained from working together. You can build networks through industry associations, events and within your own community. Do not underestimate the power of building a strong network. I have been fortunate enough to meet and work with a great number of inspirational people, and many have turned into lifelong business relationships and, in many cases, friendships too. You will never have the same opportunities if you do not create a strong network.

Recipe for Rural Success
5. Promote your business

Rural businesses are some of the worst when it comes to marketing. Nearly half of Wheatbelt businesses don’t even have a website… but that’s a conversation for another day.

Think of your business as a cupcake. If the products and services are the cake, then marketing is the icing. Have you ever eaten a cupcake without the icing? I have… because I have a four year old who only eats the icing; and I can tell you it’s pretty bland. No-one is interested in your icing-less cupcake, when there are plenty of well decorated options to choose from. Yours could be the most delectable cake on the market, but if you’re not willing to present it appropriately, no one will ever taste it to know.

There are also tonnes of online resources that can really help. A lot of marketing platforms, such as HubSpot, offer free E-books, tools, guides and even courses. Many provide their basic software for free, and free trials on their more advanced software. It’s well worth having a bit of a scout around to see what’s out there.

If you a time poor (which you definitely are if you run a rural business) there are some great marketing podcasts around that you can listen to on the road. And who isn’t on the road a lot? One of my personal favourites is Social Media Examiner. I pick up great marketing tips every time I listen to their podcasts, and always come away feeling inspired.

6. Be bold

The most successful business owners I have ever met have one thing in common; they have grit. You can be a quiet achiever, but you must have drive and be willing to take calculated risks. Businesses that do not change…are not innovative; change is a crucial element.

If you are going to sit on the sidelines and wait for the game to change, you’re going to be sadly disappointed when you lose.

Be bold.

The luckiest people and businesses are those that are prepared to take the greatest risks. We can all create our own luck by taking the necessary risks to open the door to change, progression and success.

Richard Branson


This information does not constitute business or legal advice and should not be relied upon as such. Windmill Events & Promotions are not affiliated with any of the organisations mentioned in this article.

No Comments

Post A Comment