Two Franks Cafe Closes as Wage Hikes and Card Ban Hit Small Business

Two Franks, a popular Coburg cafe run by sisters Chryssie Swarbrick and Angie Markou, will close its doors on August 1 after three years. The pair cited a perfect storm of cost increases: July 1 award wages rose 4.75%, payday superannuation was introduced, and the RBA’s upcoming card surcharge ban will prevent them from passing payment costs to customers. The closure has sparked wider concern among hospitality operators facing similar pressures.

Why the cafe became unviable

Markou told Yahoo Finance that operating costs rose across the board, with higher prices for coffee, milk, rent, electricity and insurance. The final tipping point came when multiple changes arrived simultaneously. “While individually they are reasonable and you could make it work, having them all come in all at once with such a short period of time to get prepared,” Markou said. “It was just the nail in the coffin.”

Despite attracting daily crowds and becoming a beloved community gathering space, the financial reality proved insurmountable. Markou said she was pre-empting even greater challenges ahead by closing before conditions worsened further.

The July 1 changes that tipped the balance

Australia’s award wage system delivered a 4.75% increase effective July 1, 2026. At the same time, payday superannuation guarantee payments began, requiring employers to contribute to staff super on each pay cycle rather than quarterly. These changes, combined with the looming RBA ban on debit and credit card surcharges, created a compressed timeline for small businesses to absorb costs.

The card surcharge ban, set to take effect soon, will forbid cafes from directly passing card payment costs to consumers, eliminating a revenue offset many hospitality venues relied on.

Other businesses report similar strain

Two Franks’ closure has prompted fellow hospitality operators to share their own struggles publicly. Campground Kitchen & Bar, a pizzeria in Braybrook, wrote on Instagram: “The costs are through the roof, and the toll is too high.” Lady Bower, a cafe in Reservoir, echoed the sentiment: “We feel your pain, knowing first hand exactly how you feel.”

Markou told SmartCompany that the outpouring from other business owners revealed a sector-wide crisis. “While the feedback has been reassuring from other businesses to know that we’re not alone, it is so devastating that so many business owners are feeling the same and suffering,” she said. “And for a lot of them, the only way out is to close.”

What Two Franks meant to Coburg

The sisters grew up across the street from the location, which was previously a butcher shop. They transformed it into a gathering space for locals and built a strong community following, amassing over 18,000 Instagram followers. Swarbrick had also written a regular column for SmartCompany documenting the highs and lows of cafe ownership and the business overheads behind each cup of coffee.

The closure marks the end of a three-year run that demonstrated how even popular, well-loved small businesses can struggle when cost pressures mount faster than revenue can adapt.

Final Thoughts

Two Franks’ August 1 closure signals deeper trouble for Australia’s hospitality sector. With wage rises, super changes, and card surcharge bans arriving in rapid succession, small cafe operators face a squeeze that many cannot absorb. The sisters’ decision to exit early rather than fight suggests other closures may follow.

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