The Reality of Building a Small Business in Regional Australia

We started Backwoods in 2017 after moving from the city back to our roots in North East Victoria.

Like many people, we were drawn back by the idea of building a slower, more meaningful life. We wanted to raise our kids in a regional community, spend less time in traffic and more time connected to people, nature and purpose.

We didn’t just want to live in a country town — we wanted to contribute to one... So we started a whisky distillery in Yackandandah.

For a town of around 1,000 people, Yack punches well above its weight. There are incredible people here doing extraordinary things — artists, makers, farmers, hospitality operators, tradies, entrepreneurs and small business owners all helping create a thriving, creative and deeply connected community.

We’ve loved building our business here. And we’re proud that Backwoods has become part of the story of this region.

But there’s another side to regional small business that people don’t always see.

Behind every product on a shelf or every cellar door experience is an enormous amount of pressure, risk and persistence. Especially in regional Australia.

Over two and a half years ago, we bought a block of land in Yackandandah’s industrial estate. It was the last vacant block in the area, surrounded by local businesses — engineering workshops, farm suppliers, builders, furniture makers and trades.

Our vision was simple. Build a warehouse for Backwoods. A permanent home for our whisky barrels and bottling operations. A space that would allow us to grow sustainably, employ more people and move parts of the business out of the shed at our home.

What we thought would be a straightforward shed build quickly became a lesson in how difficult it can be to grow a regional business in Australia.

Because we store whisky barrels, the project falls under hazardous goods regulations. That meant redesigns, additional engineering requirements, consultant reports and significant extra costs. Financing took over 18 months to secure, with constant revisions to make the project affordable while still meeting compliance standards.

Then came another hurdle — we were told Yackandandah had reached capacity for water and sewer connections, putting the project at risk again.

More reports. More consultants. More delays. More money.

At one point, additional fire infrastructure requirements were estimated to cost hundreds of thousands of dollars — not because we were doing something unusual, but because the surrounding infrastructure wasn’t adequately equipped to support industrial growth.

And this is the reality for many regional businesses.

We’re often told regional Australia needs investment, jobs and economic development. But the businesses trying to create those things are frequently navigating outdated infrastructure, workforce shortages, higher freight costs and layers of compliance that are significantly harder to manage outside metropolitan areas.

Then there are the external pressures regional businesses can’t control.

Bushfires. Floods. Heatwaves. Pandemics. Tourism fluctuations. A bad season can change everything overnight.

Finding staff is harder when your hiring pool is smaller. Getting customers through the door takes more effort and more marketing spend. Attending trade shows and events in the city is essential for growing a brand — but it’s expensive and time-consuming when you’re regional.

And in hospitality and tourism especially, burnout becomes incredibly common because small business owners are expected to do everything. Weekends, public holidays, late nights, admin, sales, customer service, operations — all while carrying the financial pressure of keeping the doors open.

Despite all of this, regional small businesses continue to contribute enormously to their communities.

Every dollar spent in businesses like ours flows outward into local suppliers, local trades, local farmers, local hospitality venues and local wages. Small businesses are often the ones sponsoring clubs and fundraisers, employing local people and trades, and helping keep country towns vibrant.

That contribution matters.

In industries like Australian whisky, there’s often conversation around price. People compare a bottle made by a small Australian distillery to a mass-produced international product without seeing the scale difference behind it.

The reality is that small Australian producers operate with some of the highest costs in the world — from labour and freight through to compliance and excise. But those dollars stay here.

When someone buys a bottle of Backwoods whisky, that money doesn’t disappear offshore. It goes to Australian grain growers, barrel makers, tradespeople, packaging suppliers, regional employees and local businesses. A significant portion also goes straight back to government through alcohol excise.

So no — Australian whisky doesn’t simply “cost more.” It contributes more.

And despite the challenges, we still believe deeply in what regional small business can do.

Because businesses like ours don’t just create products. They create jobs, opportunities, identity and resilience in regional communities.

That’s why we keep pushing on.

And it’s why supporting local businesses — even in small ways — matters more than ever.