THE growing demand for locally-sourced food and drink has helped to increase the number of companies in Yorkshire, according to new research.
The latest Entrepreneurs Index from Barclays and the Business Growth Fund found that the total number of enterprises in the region rose by four per cent to 156,000 in the year to March 2014.
This is higher than the number of enterprises recorded in Wales, Northern Ireland and the North East. Altogether, 131 deals were completed in Yorkshire during the 12 months to December 2014.
However, the report showed that, while Yorkshire’s start-up and wealth creation activity remained steady last year, the proportion of high-growth companies in the region stood at 20.9 per cent, which is a fall of 17 per cent in the year to March 2014.
The report’s expert panel, which includes John Cridland, the CBI director general, praised Yorkshire’s entrepreneurs for creating a large number of new companies in the media and digital sectors, as well as artisan food and drink. When the financial crisis hit in 2008, almost 2.7m people in the UK were made redundant and many were driven towards entrepreneurship out of necessity, the report says.
It continues: “At the same time, there has been a concerted effort by Government to encourage people to start their own businesses, which has involved a variety of initiatives, including access to funding, training and helping to put support networks in place for entrepreneurs.”
In his foreword, Richard Phelps, the managing director of Barclays, said the report highlighted a pressing issue: how to convert promising start-ups into enterprises that deliver lasting growth for the economy.
He said start-up activity was continuing to gain momentum, and the number of entrepreneurs creating wealth from selling a part, or all, of their business had also increased.
He added; “As the number of entrepreneurs grows, we believe that, in turn, stories of their success serve to motivate and inspire others to start up their own businesses, creating a virtuous circle for the UK enterprise scene as a whole. However, this report shows that the proportion of companies achieving high growth is beginning to show a slight fall, after we saw a plateau in our last index.
“This demonstrates that despite the improvement in the UK economy, there are still many businesses struggling to take advantage of the healthy economic growth.”
In the report, Mark Goldstone, the head of policy and representation at West and North Yorkshire, Chamber of Commerce, highlights the fact that Yorkshire continues to record growth in the number of new businesses within the media and digital sector, “as the relatively low cost of entry provides less of a challenge than most other sectors”.
He added: “The chamber has also seen interesting growth in artisan food and drink, with consumers becoming increasingly aware of provenance and willing to pay extra for premium products. Yorkshire, with its rich heritage in food manufacturing, access to quality ingredients and ready access to UK and world markets, is a great location for this type of activity.”
The Entrepreneurs Index says that the next Government must implement policies to help turn more start-ups into high growth businesses.
The report concludes: “The message is clear: while the desire to start a business is becoming more prevalent in the UK, there is work to be done in getting those businesses to the next stage; delivering growth and wealth creation.”