Wales the cheapest for business costs but among lowest for new start-ups
Posted by Dan Martin in Finances on Mon, 19/09/2011 - 09:54
Wales was found to have business costs at 4% lower than the national average, followed by the North East on 3.8% lower and Yorkshire and The Humber region on 3.5% lower.
Based on a national average 'business birth rate' of 10.2%, which means that around 10 new businesses are set-up every year for every 100 that already exist, Wales has a start-up rate of 9.1% compared to 12.6% in London. The South West is the lowest on 8.7%.
Wales is the cheapest place in the UK to run a small business but has the lowest rate of new start-ups, research reveals.
According to the study by Make It Cheaper and the Centre for Economic and Business Research, the UK's entrepreneurial hotspots do not necessarily correspond with regions of lowest cost.
Wales was found to have business costs at 4% lower than the national average, followed by the North East on 3.8% lower and Yorkshire and The Humber region on 3.5% lower. At the other end of the scale, it requires more investment to operate a small business in London than anywhere else in the UK with costs 16% higher than the national average. Labour and commercial rents are around 40% more in the capital compared to 10% and 15% in the North East and Yorkshire.
But when it comes to business hotspots, entrepreneurs are still flocking to London to start up while relatively low cost Wales has among the fewest new businesses opening.
Based on a national average 'business birth rate' of 10.2%, which means that around 10 new businesses are set-up every year for every 100 that already exist, Wales has a start-up rate of 9.1% compared to 12.6% in London. The South West is the lowest on 8.7%.Jonathan Elliott from Make It Cheaper said: "Small business owners have fought tooth and nail through recession; cutting costs where they can and even raiding personal finances to try to stay afloat.
"It is a sign of the significant costs pressures SMEs are under that relocation is on the table for many.
"SMEs considering relocation must take into account the significant disturbance to the business of such a major step, and decide whether it is really worth the trouble.
"Business owners must ensure they have exhausted every avenue of cost reduction, particularly large fixed costs such as energy and insurance, before even thinking about moving."
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