Melbourne Cafe Cites Cost-of-Living Crisis as it Shuts Doors After Four Years

Sisters Angie Markou and Chryssie Swarbrick will close their Melbourne cafe, Two Franks, on August 1, after four years of operation. The owners attribute the closure to the mounting pressures of the cost-of-living crisis, which they say have made the business no longer financially viable.

According to the owners, operating costs for the Coburg-based cafe have risen year after year, impacting expenses such as coffee, milk, rent, electricity, and insurance. "As small business owners, you expect to work hard, but when you're doing everything you can and still going backwards, you have to decide if it's time to go," Ms. Markou stated.

The recent changes to wages and superannuation, coupled with an upcoming ban on card surcharges from October 1, were cited as the final factors leading to the decision. Ms. Markou estimates that the ban on card surcharges alone will add approximately $10,000 annually to the cafe's expenses.

"It was just the nail in the coffin. I'm pre-empting how much more challenging it's going to be and getting out before it gets even worse," she explained. The new regulations mean award wages have increased by 4.75%, and employers are now required to pay superannuation contributions concurrently with wages. The impending ban on card surcharges will necessitate that advertised prices are the final cost, regardless of payment method.

In a statement shared on social media, the owners emphasized the need for greater support for small businesses. "We think that small business can be better considered and supported, while also paying staff generously and supporting their futures through super contributions," they wrote. "Sometimes, it feels like changes are brought in in isolation, with no understanding of their impact on a small business as a whole."

The closure of Two Franks highlights the difficulties faced by small businesses in Australia. Official figures indicate that over 14,000 businesses ceased operations last year. Since announcing their closure, Markou and Swarbrick have reportedly been contacted by numerous other small business owners facing similar challenges, with many describing their situations as "impossible."