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Business

Cost of living pressures putting the squeeze on small businesses in regional South Australia

Demi Tsai has been growing her own vegetables to secure supplies for her food truck. (ABC Rural: Eliza Berlage)

When the price of lettuce hit a high of more than $10 in parts of the country last year, Demi Tsai decided to take matters into her own hands by sowing seeds to shore up supply for her food van.   

Her van, Demi's Kitchen, is a favourite lunch stop in Pinnaroo along South Australia's Mallee Highway but, like many small business owners, she has grappled with the rising cost of living.

"When I started the business at the end of 2020, chicken was about $7 or $8 a kilo. But now it's about double that," Ms Tsai said.

Finding creative solutions to financial challenges has been helping Ms Tsai to stay afloat.

Demi Tsai is the daughter of Taiwanese lychee farmers. (ABC Rural: Eliza Berlage)
Ms Tsai feeds her chickens scraps from her food van. (ABC Rural: Eliza Berlage)

She built a greenhouse in her backyard and upcycled bed frames and washing lines to create trellises for her vegetables.

"I don't want to increase the price of my products too much for my customers so I'm trying to adjust how I source other foods," Ms Tsai said.

"I grow my own herbs, because that's the most expensive thing in the supermarket, so I can use that in my dishes."

Ms Tsai said she has also benefited from installing solar panels on her food van, which have helped reduce her electricity bills.

Demi Tsai's says her customers enjoy the home grown produce in her food. (ABC News: Anita Ward)

From shop to shelf 

The rising cost of living has prompted boutique baker Hayley Pokorzynski to close her shop in the Riverland town of Renmark and turn to the wholesale and online market.

Hayley Pokorzynski sells her gourmet desserts through supermarkets and cafes. (ABC Rural: Eliza Berlage)

Luxury items like her cupcakes and macarons have often been the first thing people stop buying in a tough economic climate, Ms Pokorzynski says.

"We were throwing out stock at the end of each day and it's heartbreaking because our products take a lot [of time and money] to make," she said.

Ms Pokorzynski says consumers are currently spending less on non-essential items like cupcakes. (ABC Rural: Eliza Berlage)

Despite inflation pushing up the cost of ingredients such as eggs and almond meal, Ms Pokorzynski has been reluctant to increase prices for her customers.

"They are high-end as they are but we are taking a loss on that," she said.

"It's something I need to address, but upping the price scares me because I worry nobody will buy them."

Ms Pokorzynski has been selling her products from a commercial kitchen and a pop-up shop. (Supplied)

Ms Pokorzynski hopes the move to selling her products through supermarkets and cafes will lead to a more sustainable business model.

She is already on her way to making this become a reality, getting support from a grocer in her area.

"At this stage we can handle quite a bit [of product]," Ms Pokorzynski said.

"But we're also looking at bigger spaces so we can actually incorporate and hold the amount that we want to ship out."

Kendall Crowe says there's plenty of support for small businesses ready to try new things.  (ABC News: David Frearson)

Business SA policy and advocacy manager Kendall Crowe says her organisation will advocate for the SA government to consider reducing the regional payroll tax discount in its upcoming budget.

"[It would] act as a great attraction piece for businesses to set up in the regions and more people to move to the regions," she said.

"But it also makes those businesses that sit on the border with Victoria more competitive."

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