Australia Big Business in Big Trouble
New York Commercial Real Estate Plunges 97.5% at Great Depression Levels - does the one have anything to do with the other - that is the question
Australia Big Business in Big Trouble
It’s been a tough time for businesses amid what federal Treasurer Jim Chalmers has termed a “soft” economy.
The Australian Securities and Investment Commission’s annual insolvency data published in July showed more than 11,000 companies had entered external administration for the first time in 2023 and 2024.
The collapse of Bonza and voluntary administration of Rex airlines has drawn particular attention to the aviation industry
Somewhere in between that, several US burger chain Carl’s Jr. stores folded across the country.
Then came the announcement Billson’s Brewery was going into voluntary administration.
While business failures are as old as business itself, too many in clusters point to a more concerning indicator of the state of a nation’s economy.
Griffith University business expert Graeme Hughes says a number of factors have come into play amid recent business closures, but the overall health of the economy—or lack thereof—plays some part in all of them.
In the case of Billson’s, Hughes says the hospitality realm has been hurting,” he told The Epoch Times.
“The hospitality and manufacturing sectors, which Billson’s operates in, have been particularly impacted by rising costs, inflation, and consumer spending patterns.”
Hughes said there was a “growing trend” of businesses facing challenges in the current economic situation.
“Factors such as inflation, rising interest rates, rents, wages, supply chain disruptions, and changing consumer behaviour have created a perfect storm for many businesses.
As for airlines, costs hit hard.
"The Australian aviation industry is undergoing a period of consolidation," Hughes said.
"The collapse of Bonza and the financial difficulties faced by Rex highlight the challenges of operating in a highly competitive and cost-sensitive market.
"Factors such as fuel prices, labour costs, and intense competition have made it increasingly difficult for smaller airlines to survive."
Airlines require a complex formula of support to stay in the air, according to Hughes.
"While Australia may be able to support multiple major airlines, it requires long-term support from governments, industry and consumers," he said.
Hughes said economic factors were undoubtedly still at play, including inflation and tight consumer spending.
"Consumers are doing it tough. While it's difficult to pinpoint the exact cause of Carls Jr.'s failure, it's clear that the broader economic environment definitely played a role," he said. “It’s been a tough gig in the business realm.”
Epoch Times