The number of new businesses launched in Swindon has dropped slightly but the town continues to outpace the UK average for its start-up rate, according to new figures.
First quarter data shows a 2% drop in business formation in the town against the same period last year – a decline from 407 to 399. Across the UK, the number of business start-ups climbed by 11.8%.
However, taking into account a fall-off in the number of company closures in Swindon, the town had a net business formation of 180 between January and March compared to 162 in the first three months of 2013.
This was in marked contrast to the national picture, which revealed a 5.6% increase in company failures during the period. Swindon has also outperformed the UK for its rate of business start-ups since 2009.
The figures emerge from the latest Duport Business Confidence Report for Swindon, which suggests large-scale regeneration projects underway in the town such as the Oasis refurbishment and Regent Circus leisure development could be helping underpin a strong economic bounce back.
Duport.co.uk managing director Peter Valaitis said: “A falling number of closures in Swindon suggests that the regeneration works could be improving trading conditions for local businesses. The next few years in the area should see some very positive developments for the local economy.”
While the increase in new businesses is providing the town with an economic boost, a second report this week claims the increased competition from them is creating a new threat to many established firms.
Research by business finance group Bibby Financial Services reveals these ‘post-recession start-ups’ are viewed as the biggest challenge to one-in-five small and medium-sized enterprises (SMEs) in the South West.
Bibby’s SME Tracker, which surveys businesses turning over up to £25m and employing up to 250 employees, shows 22% of them cite the increase in competition brought about by the improving economy as their biggest concern.
This is higher than the traditional small business bugbear of red tape which was the biggest worry for 14%.
Bibby Financial Services South West managing director Sharon Wiltshire said: “This is certainly a different picture from just a few years ago and the South West has returned to its position as a breeding ground for innovation and entrepreneurship.
“The economic downturn has fostered a DIY ethos in the country, which is now paying dividends for the economy through both recruitment and output.
“Technology is undoubtedly removing barriers to entry for a lot of industries, but it’s vital that new-start and early-stage businesses have the financial means to invest for long-term success.”
Other concerns for South West SMEs include a lack of skilled staff (9%), rising raw material costs (15%) and access to finance (5%).