Now may be the best time to start up new firms in the north-east, according to business incubator Elevator.
The social enterprise, which works to support entrepreneurs in the region, said Scottish government figures on loss of businesses in Aberdeen and Aberdeenshire are not surprising due to the challenging market.
However, the recent upwards climb for the region’s economy could present new opportunities, according to Elevator.
Last year, the oil price remained around $50 a barrel but has since had a resurgence, reaching more than $85 in recent weeks.
Gary McEwan, chief executive of Elevator, said: “In reflection of the recent challenging market, it comes as no surprise that the Scottish Government’s latest Businesses in Scotland report states that Aberdeen City and Aberdeenshire saw the largest reduction in firms between 2017-18.
“However, in January this year the Granite City was reported by card payment firm, Paymentsense, as the best place in the UK to launch a start-up business, with a 53.5% survival rate.
“Conventional wisdom from the top entrepreneurial universities suggests that the best time to start a business is not when a market is at its peak, nor when it is at the bottom, but rather when it is just beginning the upward climb, which is strongly where we believe the north east market is.
“During this journey, business failures are unavoidable. There will be those whose business model no longer fits the new world, or those with an unwillingness or inability to change and adapt. But, the change period also presents fresh opportunities.
“Aberdeen is at the beginning of its own climb; this is the time to be creative and innovative.”
The comments were largely reflected by Aberdeenshire Council, which pointed to the work it is doing to support growth in the region.
Head of economic development, Belinda Miller, said: “”While it’s true the number of enterprises has fallen in the North East following the downturn and subsequent cost cutting by the oil and gas majors, the council has been working with partners to minimise the negative effects of this.
“For example we are supporting redundant workers to find new employment, Business Gateway has been busy supporting new start-ups and an increase in activity has been witnessed since 2015.
“The Regional Economic Strategy recognises the importance of diversifying the economy so that it is more resilient to future fluctuations.”
Aberdeen City Council Co-Leader Councillor Jenny Laing said: “It’s clear that the North-east economy is emerging from a difficult economic period but we cannot rest on our laurels.
“There is more than £8bn of public and private infrastructure investment in the pipeline to be delivered before 2030.
“Invest Aberdeen, which was launched in August 2018, has been formed as a joint venture between Aberdeen City Council and Aberdeenshire Council, with ambitious goals for attracting significant investment in the city region and to fly the flag for the north-east at key global events.
“The first annual report produced by the Economic Policy Panel has given the city an outlook of “cautious optimism”, highlighting the potential for growth in the years ahead.
“By working collectively and collaboratively we will maintain the Aberdeen City’s Region’s contribution to the UK and Scottish economic growth.”
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