News and press releases

  • Royal Mail
    23 April 2018
    Birmingham leads British start-up boom
With recent figures indicating a boom in new British businesses (8% growth in 2016[1] and forecast to rise), Royal Mail has commissioned a report that paints a detailed portrait of modern British start-ups.  
By geography: 
  • The local authority of Birmingham has seen Britain’s biggest new business boom in 2016, with over 9,000 new businesses opening their doors (a 26% rise on 2015). Westminster, Wiltshire, Manchester and Camden also made up the top five. 
  • Copeland local authority in the Lake District was the top region for business survival, with 56% of 2011 start-ups still trading in 2016. Scottish and Northern Irish local councils also scored highly on average for new business longevity. 
  • The City of London sees the most new business “churn”. It comes in at number seven in the top ten for the number of business start-ups, but only 60.5 per cent surviving for more than two years, compared to the national average of 76%.
  • Wales, Scotland and Northern Ireland record farming as the top sector for new business. The North West is the only region where retail trade businesses, such as clothing boutiques and digital marketplace sellers, make up the most common type of start-up. 
By industry: 
  • The business support services industry[2] - which ranges from office staffing agencies to photocopying businesses - saw the largest number of new business openings over 2016[3]. More than 46,000 of these types of businesses opened in 2016, up 28% on the year before. 
  • Management consultancy firms, computer programming and IT related businesses made up the top three most common types of start-ups across the UK.
  • 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).
  • When it comes to longevity, nurseries and pre-primary schools are most likely to still be trading after five years. They are followed by doctors’ surgeries and dental practices. 
  • Manufacturing is alive and well. Glass-making companies in particular have very good survival rates, and manufacturing businesses featured three times in the top ten industry sectors for survival.
  • Royal Mail’s Address Management Unit serves more than 1.3 million business addresses across the UK.

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.” 

Ends

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Note to editors 

Royal Mail worked with the Centre for Economics and Business Research (Cebr) to investigate where, and in which industries, start-ups most frequently launch and survive. The report draws upon business demography data collated by the Office of National Statistics (ONS), from sources such as HMRC and Companies House, as well as the ONS 2017 data for UK business activity, size and location. 

About Royal Mail plc

Royal Mail plc is the parent company of Royal Mail Group Limited, the leading provider of postal and delivery services in the UK and the UK’s designated universal postal service provider. UK Parcels, International and Letters (“UKPIL”) comprises the company’s UK and international parcels and letters delivery businesses operating under the “Royal Mail” and “Parcelforce Worldwide” brands. Through the Royal Mail Core Network, the company delivers a one-price-goes-anywhere service on a range of parcels and letters products. Royal Mail has the capability to deliver to more than 29 million addresses in the UK, six days a week (excluding UK public holidays). Parcelforce Worldwide operates a separate UK network which collects and delivers express parcels. Royal Mail also owns General Logistics Systems (GLS) which operates one of the largest ground-based, deferred parcel delivery networks in Europe. 

Appendix – Table of rankings per industry

Industry

2015

2016

Business support services            

36,315

46,565

Management consultancy       

32,335

33,080

Computer programming and consultancy

27,330

25,385

Other professional, scientific and technical activities

13,385

18,695

Restaurants and mobile food activities

15,830

17,315

Architectural and engineering activities

13,665

13,600

Freight transport

12,540

13,295

Building completion and finishing

11,305

11,845

Electrical, plumbing and other construction activities

11,140

11,680

Construction of residential and non-residential buildings

8,370

10,645

 

 

 

 

 

 

 

 

About the Centre for Economics and Business Research:

Cebr – the Centre for Economics and Business Research - is a leading economics consultancy, founded in 1993 by Douglas McWilliams. Cebr has wide ranging experience and expertise on subjects from micro-economic impact studies to macro-economic forecasting across the UK, the Eurozone and global economy. 

For more information and the latest reports from Cebr, please visit www.cebr.com