It is no secret that the number of small businesses has rocketed in the last year. Now, new research shows that the UK has the best ranking for the survival of small businesses.
Increased Number of Small Businesses
The number of small businesses has聽skyrocketed聽in the past year. With a wave of聽redundancies and furloughing聽alongside spending more time at home, people took the opportunity to set up their own small businesses. This has meant that the world has seen an increase in 鈥榤icro enterprises鈥� 鈥� businesses with less than 10 employees.
Interested in finding out which countries are the best at producing lasting micro enterprises,聽money.co.uk investigated the performance of businesses with one to nine employees in 28* different European countries to find out what percentage of these businesses survived a five-year period.
United Kingdom: Number One
Money.co.uk聽can reveal that聽the UK聽is home to the聽largest number of micro enterprises which have survived five years聽in Europe. The UK created a whopping聽265,255聽micro enterprises with one to nine employees in 2013, of which an incredible聽114,590聽survived five years. Although this means that the UK has a five-year survival rate for its micro enterprises of聽43%, their surviving businesses more than double those of any other country.
The Countries With the Most Micro Enterprises After Five Years
Despite survival rates fluctuating by around 30% from the best to worst countries,聽money.co.uk聽also sought to find out which countries produced the聽most businesses聽which survived the five-year period.
Completing the top 10 countries are: Germany, Poland, Romania, Portugal, and Slovakia, in that order.
Best Countries for Micro Enterprise Survival
Money.co.uk found that the best country for the survival of micro enterprises is France. Over a five-year period, France boasts a business survival rate of 75%. In 2013, the country produced 46,549 micro enterprises, of which 35,060 were still running five years later.
The second most successful country is聽Sweden聽with a five-year survival rate of聽73%. In 2013, the country produced聽17,574聽micro enterprises, of which聽12,908聽survived the five-year period.
Coming third is聽Slovakia聽with a survival rate of聽70%聽for micro enterprises. Slovakia produced聽18,949聽micro businesses in 2013, of which聽13,328聽survived five years.
Worst Countries for Micro Enterprise Survival
The country with the聽lowest five-year survival rate聽is聽Denmark. Despite聽over聽8,000聽micro enterprises being created in 2013, only聽3,458聽survived the five-year period, leaving Denmark with a survival rate of just聽42%.
The聽United Kingdom聽ranks second lowest, with a survival rate of聽43%. However, the UK was home to聽the聽most businesses聽that survived five years聽鈥� a whopping聽114,590, twice as many as any other country.
Ranking third from bottom is聽Poland聽with a survival rate of聽44%. The country produced聽nearly聽36,000聽micro enterprises, but聽less than聽16,000聽survived five years.
Salman Haqqi, personal finance expert at聽money.co.uk,聽commented on the findings:
鈥淢any businesses have undoubtedly felt the negative impact of the pandemic on profits, but the last 18 months have also seen an increase in the number of聽small businesses around the world.
鈥淥ur analysis of the latest Eurostat figures shows that there are a handful of countries in Europe where the chances of survival are higher than others, specifically in France, Sweden, and Slovakia. Small businesses in these three countries have the highest survival rate on the continent, with over 70% of businesses passing the five-year mark – a vital marker for many businesses.
鈥淲hile there are many ways small businesses can fund themselves – including investors and personal savings, some entrepreneurs may take out a business loan. As with all loans, it鈥檚 important to remember that any money borrowed needs to be paid back, with interest, over a set time period, and missed or late payments can affect your credit score.鈥�
