Small businesses may be the lifeblood of regional towns but they were less likely than their city counterparts to be passed on to the next generation, a new report has found.
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A slowing economy, competition and the weight of long hours are taking their toll on small businesses in regional areas.
The new Economy of Shopping Small: The Future of Small Business report revealed more than half of small business owners in regional areas won't pass on their business to their children which is 31 per cent higher than business owners in metro areas.
Images Restaurant owner Jonathon Dodwell took over the Liebig Street eatery in 2000 and said the new research reflects his feeling.
"Owning a small business is very tough," he said.
"It's become a lot tougher for a range of reasons; the economy's tight, there's more competition and people are spending less.
"It's been widely reported Warrnambool has a growing population so more retailers, cafes and restaurants have opened. But the town's growth perception hasn't kept up with the growth of businesses.
"We are being spread thin."
In his own case, Mr Dodwell said his two children were studying teaching and have no plans to take over his business.
"Kids see what their parents are going through and don't want that for their future," he said.
"In hospitality, and probably other businesses, you easily work 60-70 hour weeks and as an owner you aren't paid over the holidays and some people don't even have superannuation.
"Now young people think they are better off working for someone else rather than themselves and getting no reward."
The new report stated the most frequently cited reason for people leaving their business was the personal impacts of running a small business. In regional areas, 40 per cent of small business people get out of ownership, compared to just 21 per cent in metro areas.
More than a third cited retirement plans as reasons for leaving the business while 28 per cent ssaid it was the running costs and 20 per cent said it was the long hours.
Mr Dodwell said owning a small business still had its perks, and the art of re-invention was key to longevity.
"I've always wanted to control my destiny and in owning my own business means no one can tell me I don't have a job tomorrow," he said.
"We are always trying to re-invent ourselves through new marketing ideas, services, an expanding menu and having a variety of products available.
"I have my menus scattered in almost every motel, hotel and caravan park and I have marketing business with these places too.
"Hospitality is a great industry where you mix with a lot of people of all ages. I enjoy meeting new people and having my regulars come in."
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