Evidence from 220 small business start-ups in both managed and unmanaged shopping centres in New Zealand shows that the difference in failure rates between the two are statistically significant under one definitions of failure, as defined by Watson and Everett (1996). Average annual failure rates range from 0.5% to 9.6% in this study compared with much larger government reported ‘discontinuance’ rates, thus supporting the notion that the actual small business failure experience requires closer and more detailed examination before the ‘risk of failure’ for small businesses can be understood and not assumed to be the same as the lack of continuance. This study suggests that small business failure rates would be best modelled and reported in order to provide a more accurate assessment of failure rates as well as a deeper understanding that ‘discontinuance’ is not necessarily failure’ and not, therefore, to be confused with a risk measure.
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