New figures reveal less than half of firms set up in Shropshire and Mid Wales in the last five years failed to make it to the end of 2019. And, with the arrival of the pandemic, business leaders today warned they expect to see a widespread collapse in future months.

The Federation of Small Businesses today said continuous lockdown measures had caused “irreparable damage” to firms that have struggled to the end of 2020.

Office for National Statistics data shows the extent of the challenge even before the Covid crisis struck.

• See the latest coronavirus news here

A total of 1,315 businesses in Shropshire were set up in 2014 – but by the end of 2019 just 650 remained.

In Telford & Wrekin only 270 were left from 625 over the same period, and in Powys it was 215 out of 470.

Richard Sheehan, chief executive of Shropshire Chamber of Commerce, said the business world was facing a “massively confused period”.

He added: “Starting a new business is a leap of faith, there is no question about that, and the need for support and guidance has never been more relevant than it is today.”

While there will be casualties as firms fold, Mr Sheehan predicted others trying their hand at running a business. He said that, with more people out of work, the numbers of people looking to go it alone could increase.

He demanded Government help, adding: “I think we are seeing an awful lot of support packages, not around start-ups at the moment but I am sure there will be a focus on that as people find it difficult to find employment and decide to put their destiny into their own hands.”

It’s hard, but running a new firm is achievable

Weak leadership, economic downturn or partnerships that go sour are all events that can put businesses to the test.

Surviving in hard times requires a steely determination and never-say-quit attitude. But in a year of a global pandemic where coronavirus has continued to damage the health of businesses and industries, much more has been needed in order to prevent business owners shutting up for good.

The first year for a new business is usually renown the toughest. Just like a new pair of boots, it takes some time to wear in the soles and walk off the blisters.

New figures today show the extent of the challenge, with half of new business not surviving the five years between 2014 and 2019. And, with the huge challenges brought on by coronavirus, there are fresh warnings that many more will go to the wall in the new year as the pressures simply become too hard to bear.

Getting your business to its first birthday takes equal measures of perseverance and preparation at the best of times.

But there are success stories out there.

One business that has stood up to the test is Shrewsbury-based on demand delivery service Zoom! 1hr Delivery. Kevin Williams, MD at the firm which has been running about four years, says business owners must be prepared to “do anything and everything” to make their venture work.

“The business has evolved from a menu listing service, to an online ordering platform and third-party delivery service for food and retail,” he says. “We have delivered in excess of 250,000 deliveries to date and are projected to achieve 650,000 deliveries in 2021 alone.

Upsurge

“As the business grew rapidly, the main challenge was keeping up with demand, which required a reliable infrastructure, quality resources, and finding the right hardware and drivers.

“My advice to anyone considering starting their own business is don’t go in alone, assume it will cost 10 times more than you think, and be prepared to do anything and everything you can to make it work.”

Zoom! 1hr Delivery has been one of the success stories from the pandemic. Whilst some firms have faced closing up, it has seen a rising demand from customers.

“The business was ticking over before Covid, but since the pandemic the business growth has accelerated by two to four years thanks to a huge upsurge in demand. The acceleration in demand has forced us to look into funding to ensure we make the most of this opportunity, with the aim being to expand our operations further throughout the UK and into Europe,” Kevin adds.

New figures from the Office for National Statistics show at least half the companies that started in the region failed to survive in business up to the end of 2019.

The data shows 625 businesses in Telford and Wrekin were set up in 2014 – but after three years 395 were still active, and by 2019 just 270 remained. In Shropshire, 1,315 businesses were set up in the same year but after three years 870 were still active, and by 2019 just 650 remained. And in Powys 470 businesses were set up – but after three years 295 were still active, and by 2019 just 215 remained.

Jonathan Soden opened his art gallery in Shrewsbury 2017 and believes a strong business plan and a “passion to succeed” is key to helping new start-ups succeed.

Love

“I wanted to make art as accessible as possible, bringing artwork that you might find in the big cities to Shrewsbury and service the need for a contemporary art gallery in the area,” says Mr Soden, who runs the Soden Collection.

“If you have the means and the idea and a clear business plan and the passion to succeed, do it. If you never try, you will always regret it. Owning your own business is not like having a nine to five job. Your mind is constantly on it and you can never switch off, but if it something you love then is it really a job?”

Stuart Danks, director of Shrewsbury-based recruitment firm DM Recruitment which is five years old, says the main challenge to help grow his business was to build up a solid reputation that would help it to attract clients.

“Before Covid, DM Recruitment was growing 20-30 per cent year-on-year, and we are due to do the same this year,” he says. “We took a knock in lockdown 1.0 but we have been able to bounce back and are currently running at 40 per cent up on this time last year.

“We expect to grow by 50 per cent next year and continue this trend for three to five years due to the investments we have made during the pandemic. I would say to anyone considering setting up their own business – take the risk as long as you truly believe in your idea. Focus on achieving small goals every day, week and month, and before you know it you will have smashed through that five-year goal.”

The advice from all business owners is to seek all the help that is out there. The Government has provided support over the pandemic including a Bounce Back Loan Scheme, the opportunity to defer VAT payments and business rates holidays. The Coronavirus Job Retention Scheme has been extended until March.

Philip Taylor, who runs Latte da coffee shop in Albrighton, remain optimistic for the future despite seeing turnover down about 30 per cent due to the pandemic.

"Even though we received government support through the small business and self-employed grant this year, it still doesn’t cover the running costs of the business.

"Business is currently running at minus 20 to minus 30 per cent of usual turnover.

"We are still optimistic for the future. Our regular customers tell us they will support us going forward when things return to normal again," he adds.