Number of start-ups fall

According to the latest figures from the Office for National Statistics (ONS), the number of new businesses launched in the UK fell in 2017 for the first time since 2010.

Only 382,000 new firms registered for VAT and PAYE in 2017, compared to 414,000 a year earlier. The figures also show a rise in businesses ceasing trading last year, from 288,000 in 2015 to 357,000 in 2017.

The ONS said that continued uncertainty over the UK’s future relationship with the European Union could be behind the “sharp fall”. It also suggested that depreciation of sterling following the EU referendum result, feeding into higher raw materials and import prices, could have also discouraged birth of new businesses and/or led to deaths of existing businesses.

The report found that London recorded the largest proportion of firms going out of business at 14.2 per cent but also had the second largest number of start-ups at 15.2 per cent of the whole.

The north-west saw the highest so-called ‘business birth rate’ at 15.9 per cent, with an impressive 78 per cent rise in the number of new businesses formed between 2012 and 2017.

Interestingly, however, separate research suggests that Brighton in Sussex is the best place to start a business when rates, affordable housing, digital connectivity and suitable workforce were taken into account.

One of the report’s authors said that it is great news for Brighton, which has a base of independent stores that are supported by local people. However, he added that it is in the best interests of every town and city in the UK to provide the right environment for entrepreneurs as too many new businesses fail, often because they are unaware of the steps owners need to help their business get off the ground. He therefore suggested that they take professional advice to help them in their early days.