London small firms dominate fast growth list despite inflationary drag
London’s small businesses have dominated a list of the country’s fastest growing firms this year despite inflation dragging on growth across the country, according to new research.
In a ranking of the UK’s 100 fastest growing small firms by business group FEBE, 26 per cent of firms hailed from the capital while 13 per cent came from the broader south east. Yorkshire came in at third position at 11 while Scotland had nine high growth firms.
The annual list, which ranks the top 100 profitable small businesses with founders still involved, found that a host of London firms had shrugged off a surge in costs this year to post bumper growth.
However, FEBE founder and former Big Four auditor John Maffioli told Morning Wire that the economic downturn had slowed growth across the board and narrowed the field of firms.
“One of the things that was more of a challenge this year, is the operating profit side of the businesses. More businesses had dipped out at the operating profit side. Which is why this year, we researched more businesses than ever [to compile the list].”
He added the group found a major “impact on profitability” among smaller firms this year.
The strong performance for London firms came despite rocketing inflation and energy costs buffeting the UK this year and triggering a sharp rise in insolvencies.
The number of SMEs that disappeared in London last year swelled to 53,880, up sharply from 37,350 in 2017, according to analysis of Office for National Statistics figures by the Liberal Democrats shared with Morning Wire
However, Maffiol said the talent and funding flow in the capital had helped many firms stay on on a growth trajectory.
“London and the south east have an incredibly talented resource of people, which is what makes it an amazing place to do business,” he added.