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The UK's Best Areas To Launch A Business

research

Torfaen in Wales is the best area in the UK to start a business, averaging three new openings for every two closures between 2022 and 2024.

  • The City of London has the second-best ratio of business openings to closures (1.206:1), with four for every three closures.
  • Wyre Forest is the worst area in the UK to start a business, with closures more than twice as common compared to openings in the region, at a ratio of 0.451:1.
Torfaen is the best area in the UK to start a business, according to a new study. MRP software for small manufacturers MRPeasy analysed data from the Office of National Statistics (ONS) on business openings and closures in each UK local authority between 2022 and 2024. The figures were totalled for each area and ranked based on the highest ratio of openings to closures. Approximately 724,625 businesses opened in the UK from 2022 to 2024, while 800,165 closed during this time. On average, for every 10 businesses that open nationwide, 11 close down. England is the best nation in the UK to launch a business, with a slightly better ratio of openings to closures (0.912:1), while Northern Ireland ranks as the worst (0.808:1). Torfaen in Wales topped the study as the best area in the UK to launch a business. Between 2022 and 2024, 995 new businesses were established, and just 670 closed. The area has the highest ratio of openings to closures, with 1.485:1, meaning that, on average, three new businesses open for every two closures. Torfaen’s ratio is 63.91% higher than the national average and 23.13% more than its closest competitor, the City of London. Q1 of 2023 was the best period for businesses in Torfaen, with 295 businesses opening and 110 closing at an impressive ratio of 2.682:1. The City of London claimed second spot and ranked as the best place in England to start a business. Over the last two years, 4,280 new companies have opened in the area, a significant increase from the 3,550 closures recorded during the same period. With the ratio of openings to closures at 1.206:1, business owners in the City of London are more likely to succeed than any other place in England. Six new businesses are formed in the area for every five business closures recorded. Between January and March of 2024, 495 businesses launched in the area, while 380 closed, giving the area a higher ratio of 1.303:1 in recent months. The Isles of Scilly ranked third among the UK’s best areas to launch a business. Despite smaller figures than any other area in the study, the Isles of Scilly have the third highest ratio of business openings to closures. Exactly 30 new businesses have opened their doors in the last two years, while 25 have closed, meaning the area ranks slightly behind the City of London with a ratio of 1.2:1. Five new businesses have been established in the region during the first quarter of 2024, and no existing companies have shut down. Stevenage ranks fourth in the list of the top UK areas to start a business. Between Q1 of 2022 and Q1 of 2024, exactly 1,050 new businesses were registered in Stevenage, while 935 have officially closed. Around 10 new businesses open for every nine closures in the area, making it one of the UK’s best areas to succeed with a business. July, August and September of 2023 proved to be the best months for businesses in Stevenage, with reports of 125 openings and 85 closures at a rate of 1.471:1. Kingston upon Hull rounds out the UK’s five best areas to start a business. From 2022 to 2024, the area has seen 2,780 new businesses open and 2,545 close, with the ratio of openings to closures at 1.092:1. It is one of only 34 areas where business openings have been more common than closures in the last two years. In fact, 12 new businesses open their doors in Hull for every 11 closures. Since 2022, the ratio of openings to closures has dropped significantly in Hull from 2.339:1 in Q1 2022 to 1.075:1 in Q1 2024. Westminster is the sixth best area in the UK to launch a business, according to the study. Around 12 firms open for every 11 closures in the region, at a ratio of 1.091:1. Only Birmingham has had more business openings between 2022 and 2024 than Westminster, which registered 14,640 openings and 13,420 closures.  From January to March 2024 alone, 1,630 new businesses have launched in Westminster and 1,515 have closed, at a lower rate of 1.076:1. Nottingham ranked seventh among the UK’s best areas to establish a business. Since 2022, 3,175 businesses have opened in Nottingham, while 2,925 have closed. On average, 14 businesses are launched for every 13 closures in the area during this period. Q3 of 2023 was the most successful period for businesses in Nottingham over the last two years, with the ratio of openings to closures sitting at 1.471:1, 35.9% higher than the average ratio of 1.082:1. Harlow ranked eighth with a ratio of openings to closures of 1.076:1 between 2022 and 2024. Approximately 1,205 businesses have been established, and 1,120 closed during this period. On average, every time 14 firms close their doors in Harlow, 15 new businesses open. The first three months of 2024 have been the best period for businesses in the area, with 160 and 115 openings and closures registered, respectively, or 1.391:1. Businesses in the Blackburn with Darwen council area reside in the UK’s ninth-best region for launching a business. Over the last two years, 1,730 companies have opened in the area, and 1,625 closures have been recorded, at a ratio of 1.065 openings for every closure. During Q1 of 2024, 215 businesses opened and 180 closed, resulting in a higher ratio of 1.194 compared to the average since 2022. Norwich is the final area to be named among the UK’s best spots to start a business. Exactly 1,500 new businesses have been set up in Norwich since 2022. In contrast, 1,410 businesses shut down during the same period. Around 17 new businesses are built in Norwich for every 16 closures at a ratio of 1.064:1. Since Q1 of 2022, the ratio in Norwich has jumped by 32.98%. Wyre Forest is the worst area in the UK to start a business, with closures more than twice as common compared to openings in the region, at a ratio of 2.215:1. Mike Lurye, Director of Business Development at MRPeasy, commented on the study: “Despite Torfaen claiming the top spot on the study, England is the best nation in the UK to start a business (0.912:1), having a higher ratio of openings to closures than Scotland (0.887:1), Wales (0.874:1), and Northern Ireland (0.808:1). “Just 9.39% of all UK local authorities have a higher rate of business openings than business closures in the last two years. Two areas of London and three spots in the East of England rank among the 10 best areas to start a business. Meanwhile, Clackmannanshire was Scotland’s highest-placed area in the study, at 21st, and Belfast was top in Northern Ireland, taking 29th spot.”

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