New research has found that start-ups and small firms are performing at different rates across the UK and that London, even though its economy is growing faster than anywhere else in the country, is not necessarily the place where they have the most success.
A report published by the Enterprise Research Centre and the Business Growth Service shows that London had around 90 start-ups for every 10,000 people in the population over the last year, whereas the average figure across the country is around 50 per 10,000. However, perhaps surprisingly, the capital is close to the bottom of the table on start-up survival rates, with only one in two businesses that started there three years ago still trading.
In fact, the best area for survival in the UK is Northern Ireland, where 11 per cent of new businesses in 2011 were turning over at least £1m by last year, whereas the national average is closer to 6 per cent.
Meanwhile, 9 per cent of new firms in the Thames Valley with an annual turnover of between £1m and £2m in 2011 had grown that to £3m by last year, a higher percentage than anywhere else in the UK.
The research also suggests that businesses based in different part of the country are struggling to overcome different types of obstacles. In London, the most significant issue appears to be skills shortages. Whereas businesses in the Midlands cite their difficulties with strategy and management as barriers to growth. Meanwhile, access to finance is an issue across the country, but notably problematic in the North-east of England.