East's wave of lockdown entrepreneurs' 'under threat' as cashflow issues mount

The John Russell architectural workshop in Rosemary Works. Photo credit Jonny Thompson

Start-up entrepreneurs have risen at a fast rate in East Anglia - but late payments are among the threats they face, R3 Eastern has warned - Credit: Jonny Thompson

New entrepreneurs are on the rise in East Anglia - but they face threats to their survival, research suggests.

A study by regional insolvency practitioner trade body R3 Eastern shows  7,553 start-ups registered in May - the largest number in the UK outside of Greater London which recorded 22,684 new businesses.

According to its report - based on analysis of data from business intelligence provider Creditsafe - the region saw a 12.6% rise on April, when 6,707 start-ups were recorded. It was also a 15% increase on the start of the year, which saw 6,565 new businesses setting up.

But the future of the burgeoning number of new businesses could be threatened by late payment issues, warned R3 Eastern - as the region recorded the highest number of late payments in the UK outside of greater London. East Anglia saw 72,554 in May - up from 72,037 in April, it found.

R3 Eastern chairman Alistair Bacon said: “These statistics highlight the effect that continuing economic challenges and uncertainty are having on businesses in East Anglia, despite the current surge in local entrepreneurs.

Experts have warned that more companies are starting fall into insolvency as a result of the Covid-1

Alistair Bacon, chairman of R3 Eastern - Credit: R3 Eastern

“The growth in start-ups is a positive, which is likely to have been led by local individuals who were furloughed or made redundant during the pandemic and who used the lockdowns as a springboard to venture out on their own.

“However, their sustainability is being threatened because, like many longer-established companies in the region, they are being forced to trade amid rising inflation, contracting economies, spiralling fuel, energy and wage costs, and consumer confidence at a near historic low.

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“Our advice to any directors who are worried about the viability of their business, start-up or otherwise, is to seek professional help and to do it as soon as possible. The sooner support is sought, the more opportunities there may be to assure a company’s survival and future success.”