North West outperforms London for new business start-ups
The North West offers better conditions for business start-ups than London, with growth of 10% higher than that found in the capital, according to new figures.
A record level of start-ups can now be found in the UK according to UK insolvency and restructuring body R3.
Growth in London was still positive, with the number of start-ups increasing by 6%, although business rates and other operational costs are higher in the capital than elsewhere.
In December 2016, there were 32,774 more businesses in the North West than in the same month of 2015 –leaving the number of active businesses at its highest level on record, at nearly 350,000.
Overall in the UK, the number of small business start-ups increased by 25% throughout 2016, but the financial state of the majority of those firms is yet to be filed.
Using figures from the BvD database, the research was able to highlight which sectors noted particularly high levels of growth.
The transport sector for instance, saw the creation of more than 6,500 businesses in the year, recording growth of 46%.
Meanwhile the number of restaurants rose by 25% while construction firms and those in the technology and IT sector noted growth of 15% and 14% respectively.
The professional services sector also noted double digit growth in the number of new start-ups in 2016 of 11%, despite the uncertain economic conditions that followed the EU referendum.
The North West chair of R3 Richard Wolff said the figures are reflective of the start-up culture that exists in the UK.
He suggested that the growth in transport firms could be as a result of higher demand for couriers, although there could be a range of factors driving the rise in firms.
While the figures are cause for optimism, early-stage businesses are more vulnerable to fail – four in ten businesses face insolvency in the first five years, according to Ormsby Street.
Firms fearing financial difficulty in the capital should contact a London insolvency practitioner to discuss their situation and consider the best course of action to take.
By Phil Smith