Survey Reveals City Growth Hotspots

SMEs Given Pointers Over Best Locations For Success


Fergal Dowling, Partner | +44 (0)121 214 5476

A new survey has identified the best and worst urban areas in the UK for SMEs to enjoy strong business prospects.

Centre For Cities - which listed some locations as cities even though they are officially towns - noted that London remains the best performer for the number of SME starts per head of population, with Aberdeen second and Brighton third. Grimsby and Northampton were the best performers in the Midlands and Warrington had the highest start-up rate in the north.

Warrington's performance also included the highest SME growth in the UK, with 1.6 times as many firms expanding between 2010 and 2013 as in Dundee, the weakest performer in this regard. It was also third for the creation of new jobs per expanding SME, behind Peterborough and Aberdeen.

The survey of the UK's 64 largest centres of population revealed Dundee also had the fourth-lowest start-up rate, behind Wakefield, Plymouth and Barnsley.

While the contrasting fortunes of some locations within the same region - such as Aberdeen and Dundee - were evident, it was notable that the south-east contained four of the top ten performers (Brighton, Milton Keynes, Reading and Aldershot), but none of the bottom ten. However, despite its high start-up ratio, Brighton was down at 55th for new jobs created per expanding firm.

Discussing the findings, chief executive of Centre for Cities Alexandra Jones said firms pursuing high-growth strategies are the ones who tend to get ahead.

She commented: "Cities with the largest share of SMEs employing high-growth strategies have wages that are, on average, 18 per cent higher than the bottom five cities.

"Firms that adopted higher growth strategies are less likely to have taken cost-cutting approaches - such as implementing redundancies - during the recession and are now more likely to be actively recruiting and expanding their businesses in the recovery."

According to the most recent Office for National Statistics survey on business and employment numbers - published in October last year - 14.4 million people work for SMEs, making up 59.3 per cent of private sector jobs.

Expert Opinion
It is interesting to see these trends relating to small businesses and research of this nature really demonstrates how entrepreneurs and talented, ambitious new companies can emerge in all kinds of areas.

"However, while the origins of SMEs can vary, one thing they all have in common is a need to have access to a quality support network that can provide guidance on a range of key issues. Unlike larger organisations, small businesses do not often have the resources to take on core matters such as HR or property issues in-house.

"As a result, it is vital that ambitious businesses have quality advice to hand and central to this should be legal experts, who can provide timely support on a range of matters and ensure that an operation complies with all relevant regulation."
Fergal Dowling, Partner