Business start-ups in the East Midlands have hit a high in October with a month-on-month rise of 10.9%, one of the UK’s highest regional increases, according to the Midlands branch of national insolvency and restructuring body R3.
R3’s findings, which are based on data from business intelligence provider Creditsafe, reveal that new business registrations rose to 2,251 in October from the previous month’s figure of 2,030, a percentage increase exceeded only by Yorkshire & Humberside, the North East and Wales.
The East Midlands’ October start-ups figure is also a 2.4% increase on the number of new companies registered in the region six months previously.
Despite this growth in entrepreneurship, R3’s analysis indicates that late payments could pose a sizeable challenge to new companies, as well as to their longer-established counterparts. The data shows that, in October, the East Midlands had 27,077 companies with customer payments past their due date, a figure which has risen steadily in recent months.
R3 Midlands Chair Eddie Williams, a partner at PwC in the East Midlands, said: “These statistics highlight the effect that over two years of economic turbulence have had – and continue to have – on our local businesses.
“The growth in start-ups is most definitely a positive – a trend which is likely to have been driven by those who were furloughed or made redundant during the pandemic and who have decided to venture out on their own. This is an encouraging sign of entrepreneurialism and enterprise resilience in our region.
“However, this growth is being severely threatened by current market conditions, which include a perfect storm of spiralling inflation, contracting economies, steep rises in fuel, energy and wage costs, and dwindling consumer confidence. Late payments will only exacerbate these challenges facing local businesses.
“Our advice to any director who is worried about the viability of their business, start-up or otherwise, is to seek professional help and to do it as soon as possible. The sooner support is sought, the more opportunities there may be to assure a company’s survival and future success.”
