Rising costs hurt South Australia's regional high streets

Businesses operating on Mount Gambier's main street say increasing costs and changing consumer habits are hurting retail.

The city's chamber of commerce says large shop fronts are becoming increasingly unsustainable.

The city is planning upgrades to the street, and some small retailers are setting up shop.

Empty shops and "for lease" signs line Mount Gambier's main retail strip as high costs and online shopping drive customers away.

The city, in South Australia's South East, is home to about 30,000 people. It also serves as the commercial hub for the wider Limestone Coast region.

Mount Gambier's economic heart has always been based around Commercial Street, but that is rapidly changing.

A walk down the 1.2-kilometre retail strip between Wehl and Crouch streets reveals retailers are few and far between.

Country Attitude co-director Kathy Gandolfi, who has been in business on the main street for 22 years, said having fewer shops hurt everyone.

"It's good to have a vibrant main street," she said.

As high interest rates and inflation hurt consumers' pockets, increased overheads are putting added pressure on businesses.

Mount Gambier Chamber of Commerce chair Samuel Taylor said having a large shopfront on the main street was increasingly unviable.

He said bigger shops required more stock to display, but those items just racked up costs for the business every day they were not sold.

"We're seeing a big shift away from large-scale businesses and you're moving into a more cost-effective model which is a smaller shopfront," he said.

For larger retailers, a move away from the main street made more sense in terms of rental and operating costs, he said.

Like bricks-and-mortar shops everywhere, Mount Gambier's retail sector has also been hit by the online shopping boom.

Ms Gandolfi said more food and service businesses, like health clinics and hairdressers, were now opening on the main street "because you can't buy a job by a physio or something online".

Retailers like Keiran Hein, however, are hopeful for the future of Commercial Street.

Ms Hein opened her ice cream and confectionary shop, Lollies & Scoops, just two weeks ago.

She believed her business would succeed.

Two previously empty buildings have also now been leased.

"I would have loved to have spent so much money in decorating this place and doing it up into a wonderland, but the reality is that I can't," she said.

"So it's basic, it's bright, it's clean. We've got good food and produce and that's all that matters at the moment."

Mount Gambier Mayor Lynette Martin described the movement of businesses along the street as "cyclical", and said the council was working on a master plan for the CBD which was set to include updates to the main street.

"It's been there for over 100 years, shops have come and gone, businesses have come and gone, but it always seems to come back to be fully or almost fully occupied," she said.