Janine Hill
THE number of Sunshine Coast businesses closing their doors has increased, in a further sign the local economy is in strife.
Two specialist insolvency and liquidation firms on the Sunshine Coast have reported a rise in appointments during the past few months.
Paul Nogueria, a partner at Worrells, Maroochydore, estimated the number of businesses closing was up 30% on the same period last year.
“Over the last six months, there’s been quite a sharp increase in the amount of insolvencies coming through, both liquidations and bankruptcies,” he said.
“There’s been quite a large increase in insolvencies over the last four months.”
The increase has also been noticed at SV Partners, Maroochydore.
“We’re seeing an increase in insolvency appointments in the last six months,” director Jason Cronan said.
“I’ve moved up from the Brisbane office due to the increase in this office.”
Queensland Chamber of Commerce and Industry analysis of statistics found the number of Coast businesses with employees dropped 0.9% over a two-year period.
The industries which experienced the biggest decline were agriculture, forestry and fishing (down 7.45%), transport, postal and warehousing (down 7.30%) and financial and insurance services (down 7.14%).
Mr Nogueria said closures were occurring across a range of industries, including retail, hospitality, and construction, noting that firms supplying building companies figured more prominently than builders themselves.
He said most insolvencies were the result of “not having your finger on the pulse”, but said many of those coming to his firm had been struggling for an extended period.
“They’ve run out of capital and haven’t taken appropriate remedial action to avoid the position they’re in.”
Mr Cronan said businesses were also closing because of pressure from the Tax Office over money owed.
He said struggling businesses stopped paying taxes to stay afloat.
“From our experience, that’s very common,” he said.
“Most companies and businesses pay the debts they need to first, before the ones that they’re not being chased for.”
Mr Cronan said the general state of the economy and tightening of cash in circulation made it more difficult for businesses to remain open.
“The banks are getting tough, the Tax Office is pushing harder, and it’s just getting harder for people to make money,” he said