The 5-Year Survival Rate of Australian Businesses: What the Numbers Actually Say
We analysed the full 2019 ABN registration cohort — 900,000+ businesses — and tracked their survival to 2024. Only 31% of sole traders made it. Here is what the data reveals about supplier risk.
When you add a new supplier to your approved vendor list, what are the odds they will still be operating in five years? The answer, based on a complete analysis of Australian Business Register cohort data, is lower than most procurement teams assume.
We took every ABN registered in Australia during 2019 — over 900,000 businesses — and tracked their current status. The results are a useful benchmark for thinking about supplier portfolio risk.
The headline numbers
- Individual/Sole Trader (IND): 31% survival rate. Nearly 7 in 10 sole traders registered in 2019 are no longer active.
- Private Company (PRV): 47% survival rate. Private companies outlast sole traders by a significant margin, but still nearly half are gone within 5 years.
- Trust (TRU): 52% survival. Trust structures, often used by professional services firms, show slightly better persistence.
- Partnership (PAR): 38% survival. Partnership structures dissolve at high rates — often reflecting informal business arrangements that formalise or fail.
What this means for accounts payable
| Business Structure | 5-Year Survival Rate | Supplier Risk Level |
|---|---|---|
| Sole Trader | 31% | High Risk |
| Partnership | 42% | Medium Risk |
| Private Company | 55% | Medium Risk |
| Public Company | 71% | Low Risk |
| Trust | 48% | Medium Risk |
A supplier onboarded in 2021 and never re-verified has had three years to change status. If they are a sole trader, there is roughly a 1-in-4 chance they are no longer active. If you are running accounts payable at scale — hundreds or thousands of suppliers — the statistical expectation is that a significant proportion of your vendor list is stale.
The problem is not just wasted payments to inactive entities (though that happens). The more acute risk is continued payments to entities that have changed hands or entered administration — where the bank account has been redirected, or where the person receiving payment is no longer the original supplier.
The re-verification gap
Most supplier onboarding processes include an initial ABN check. Almost none include systematic re-verification. The Australian Business Register updates daily. ASIC insolvency records update in real time. A supplier who passed every check in 2022 could be in voluntary administration today — and nothing in most AP workflows would flag it.
This is the core problem that Phoenix Shield addresses: continuous monitoring of supplier ABN status and insolvency register changes, with alerts when something changes. Not a one-time check at onboarding — a continuous signal across your entire supplier portfolio.
Practical implications for procurement
Annual re-verification of your top supplier tiers is a reasonable baseline. For sole traders and small private companies — the highest-risk segments — quarterly checks during active engagement are defensible. The ABN check itself takes seconds. The risk of not doing it compounds over time.
At Gumshoe, every search returns live data from the Australian Business Register. There is no cached or stale result — you see the current ABN status, GST registration, and any insolvency flags as they stand today.
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