Birmingham leads British start-up boom

Royal Mail has commissioned a new report to paint a detailed picture of modern British business start-ups, following reports of a new business boom. Birmingham is very much at the epicentre of this surge; with over 9,000 business support, retail and tech start-ups opening their doors in 2016 (a 26% rise on 2015).

Elsewhere in the UK, Copeland in Lancashire is the region where businesses are most likely to survive; with 56% lasting the distance from 2011 until 2016, compared to the national average of 44%.

Business support services are by far the largest sector for new business openings (with over 46,500 companies of this type opening their doors in 2016). 

It appears many Britons are realising a long-standing dream to leave the day job and start up their own consultancy: over 33,000 new management consultancy firms opened in 2016. IT consultancy firms also make up the top three most popular sectors. 

Sectors within the food, tech, construction and freight industries also benefitted from a new business boom, according to the research. Warehousing and storage is officially the fastest-growing sector for start-ups, with a 1,133% increase on 2015 (4,750 start-ups in 2016, compared to 385 in 2015). 

Nursery and pre-primary schools have the strongest five-year survival rate of any industry (average 66%). Other essential local services also fare particularly strongly, including medical and dental practices (62%) and veterinary services (58%).    

Across the UK, manufacturing services, including machine, air and space and beverage production businesses have some of the strongest survival rates (59% on average). Glass manufacture firms also have the highest two-year survival rate of any industry (91%, compared to the national average of 76%). 

Other interesting snippets from the research include:

  • Wiltshire featured third in the list of local authorities seeing the biggest spike in new businesses (a 203% increase on 2015 to 7,730), indicating that the trend isn’t simply limited to city areas. 
  • Following Birmingham, the local authorities of Westminster (8,455), Manchester (6,445), Camden (6,050), Central Bedfordshire (4,865), City Of London (4,850), Leeds (4,820), Hackney (4,670) and Barnet (4,455) also feature highly.
  • The most common sectors for start-up sized businesses by region include:
  • North West: Retail trade
  • North East, Yorkshire & the Humber, East & West Midlands, East: Specialised construction industries
  • London & South East: Head office utility services or management consultancy activities
  • South West, Wales, Scotland and Northern Ireland: Farming
  • New businesses in Scottish local authorities typically have some of the highest five-year survival rates (Aberdeenshire, Aberdeen City, East Lothian and Shetland Islands average 54%), as do those in Northern Ireland. 
  • None of the businesses established in 2011 to perform head office utility services or landscaping have survived. 

Steve Rooney, Head of Address Management Unit at Royal Mail said:

“We deliver to more than [1.3] million business addresses across the UK, so I’m not at all surprised that this research shows we are a nation of entrepreneurs. It’s fantastic to see that so many people have embraced their inner business owner and set up on their own. I hope that we’re delivering to many – if not all – of these fledgling firms in five years’ time.” 

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