Cautious outlook as Scotland sees jump in number of business start-ups

Scotland has witnessed a jump in the number of business start-ups, new figures reveal.

Nearly 12,000 businesses have been set up in Scotland since the start of the year, according to research from insolvency and restructuring trade body R3.

The figures, which are based on an analysis of data provided by Creditsafe, reveal 11,783 businesses were set up during January, February, March and April 2022.

March was the busiest month for Scottish start-ups, with 3,494 businesses being set up that month, followed by February (2,925) and January (2,715). This is said to mirror the UK-wide picture, which saw 77,790 businesses set up in March, 66,024 set up in February, and 64,264 established in January.

R3 in Scotland chairman Richard Bathgate said: “The start of the year and the end of the Covid restrictions have clearly led to a boom in entrepreneurialism in Scotland, with a large number of people starting their own businesses.

“It’s clear people are still confident about the economy despite the recent turbulence caused by the pandemic and the war in Ukraine and there’s clearly a belief the market can support new businesses.”

Bathgate, who is a restructuring partner at Johnston Carmichael, added: “Despite this, it’s crucial to bear in mind that we’re operating in the most difficult economic climate since the pandemic was at its peak.

“Businesses are facing increased creditor pressure, rising inflation and low consumer confidence, all of which will have an effect on their margins and their finances.

"While no-one thinking about setting up a new business should be discouraged by this, they should be prepared for their first year to be a challenging one.”