THE number of new businesses being set up in Edinburgh has reached the highest level for more than four years, figures have revealed.
More firms were set up in March than in any month since 2008, as 284 launched with the help of the Business Gateway service.
On average, 100 businesses launched each month and although March is typically one of the busiest times for new firms, there was a 55 per cent increase on last year, while the figure was just 140 in 2009.
Business groups said the city economy remained strong but that new firms needed more support in the medium term to ensure they survive.
As the News reported last month, a study found more firms are collapsing than being set up for the first time since 2004.
In October, the Business Gateway service will be transferred from being run by a consortium including the Edinburgh Chamber of Commerce to Edinburgh City Council, and will place greater emphasis on business survival.
Gordon Henderson, development manager for the Federation of Small Businesses in Edinburgh, said the increase in new firms is encouraging, but said the focus needed to remain on keeping them going.
He said: “We’re very pleased to see so many firms starting up. Small businesses are crucial to the future of the Edinburgh economy and will create the jobs the city needs.
“But we do need more emphasis on survival and the shift to that when the Business Gateway contract goes in-house at Edinburgh City Council represents a pretty big change in the way firms are supported.”
Former Hearts under-21 footballer Elliot Smith set up Nectre, a marketing firm for the financial services industry, in recent months.
He said: “Previously, I had run a business for five or six years and was made redundant along with my business partner. We set up our current business as we still felt we had enough to offer. There seemed to be limited support in actually getting set up, and no support once we were set up.”
It is understood that the recession is part of the reason for the high number of new firms launched, with those who have lost jobs in the public or private sector turning their hand to entrepreneurship.
However, Dave Anderson, director of the city development department at the council, said the strong city economy was among the reasons for growth.
He added: “It is one of the world’s most attractive cities for foreign direct investment and its ability to compete on a global level makes it an ideal place to base a business.”
Graham Birse, director of policy at the Edinburgh Chamber of Commerce, said survival rates are higher in Edinburgh than anywhere in Scotland, but added: “The important thing is not how many are starting up, but how many will be in businesses in two or three years.”
Trim and proper
Andrew Cannon is the owner of Ruffians barbers, situated in the West End and a real success story during its first two months.
“It’s going really well,” said Mr Cannon. “I suppose there is nothing like it in terms of male hairdressing.
“There are so many unisex salons, but about 80 per cent of their clientele is female so this isn’t the kind of environment men want.
“As an exclusively male place, we are proud to be a pioneer of men’s hairdressing. I think we are doing well because of the service we provide.”