The current state of business health in the South West found 39 per cent of small businesses were thriving, 56 per cent were doing okay and five per cent were about to fail.
According to a report looking at the future of small business in WA released by the Bankwest Curtin Economics Centre, seven per cent of all WA’s small businesses were in the South West.
Of those South West businesses, 63 per cent were non-employing which was the highest percentage of non-employing businesses in regional WA.
The highest percentage of industries in the South West which were non-employing included construction, agriculture and rental, hiring and real estate services.
Across WA, payment delays were impacting the vitality of small businesses.
The economics centre director professor Alan Duncan said one barrier affecting small business in WA was cash flow and more than half of the small businesses in WA experienced late payments from larger businesses.
“One in five small businesses face payment delays of a month or more,” he said.
“It adds significantly to the financial stress they face on a daily basis in maintaining and growing their business.”
Vasse MP Libby Mettam said the government addressed part of this issue for subcontractors on government contracts.
“Where government was quarantined to ensure that subcontractors were paid ahead of the state government commitments to projects,” she said.
“There is a fine line between achieving this without creating additional red tape, as that is a burden we know not only costs business, but costs smaller businesses to a greater extent than big business.”
The report showed that small businesses accounted for 97 per cent of all businesses based in WA, contributing $39.7 billion to the economy and employed 41 per cent of WA’s overall workers.
The three industries with 100 per cent survival rates for a new small business included early education, hospitals and heritage activities.
The three industries with the best survival rates for an established business were defence, residential care and warehousing and storage.
The worst survival rates for established businesses were non-store retailing, commission based buying or selling, forestry and logging.
Across WA, the highest wages were in mining, construction and professional services.
Information media, telecommunications, public administration, arts and recreation services had the lowest wages.
