East Midlands sees rise in start-ups post-election despite mixed economic conditions

The number of new businesses in the East Midlands has started to increase again after a drop in May, following the General Election announcement.

According to R3 Midlands, a regional branch of the national insolvency and restructuring trade body, and based on data from Creditsafe, 2,249 companies were registered in the East Midlands in July, representing a 5.04% increase from June and an 8.33% rise from May’s 2,076 start-ups.

Debts owed by businesses in liquidation dropped by 10.95% from the previous month and by 37.11% since January.

However, the overall economic situation remains uncertain.

The number of East Midlands companies with overdue payments has steadily increased this year, reaching 23,917 last month, up from 23,194 in January.

R3 Midlands Chair Stephen Rome, said: “It’s encouraging to see entrepreneurs becoming more confident and willing to push ahead with their new business plans.  Lower inflation and the prospect of greater sales opportunities appear to be having some effect. However, we have yet to see the full impact of the General Election on the economy and purchasing decisions, and many directors of potential start-ups – and existing businesses – are concerned about customer demand, staff turnover and meeting regulatory requirements.

“The pledge to reform business rates to be fairer may benefit many East Midlands companies, particularly those in the retail and hospitality sector. Plans to introduce legislation to tackle late payments, if effective, will improve cashflow for local businesses – especially valuable for vulnerable start-ups – and could free up resources to allow firms to focus on investment and growth rather than chasing up overdue invoices.

“Such measures will, undoubtedly, take time to introduce. Therefore, R3’s advice to any directors worried about the viability of their company, start-up or otherwise, is to seek professional help and to do it as soon as possible. Many R3 Midlands members offer a free initial consultation to those who wish to explore their options.”