VAT Registered Businesses
2.92 Business stock is a measure of overall levels of entrepreneurial activity. South West England had 183,420 VAT registered businesses at the beginning of 2007, 11% of the English total. SW business stock has been growing since 1996, though slightly slower than the England average (1.8% vs. 1.9% per annum, 2002 to 2007). The region sees around 15,000 to 16,000 VAT registrations per year and 12,000 to 13,000 deregistrations.
2.93 Since 1999 the South West has had both the lowest regional rate of business registrations and deregistrations (as a proportion of business stock). This low 'churn' rate perhaps indicates a lack of entrepreneurship. However, the region also benefits from comparatively high rates of business stock (per head) - the South West has the third highest density of business stock after London and the South East.
2.94 Business survival rates for start up companies after one year and three years give an indication of a region’s level of successful entrepreneurship and the presence of suitable conditions for business growth. South West England performed well on these measures, ranking first of all English regions. As well as indicating that the region may provide good conditions for nurturing new business, the low turnover and lack of failure may suggest that businesses are averse to risk and thereby innovation, a key driver of productivity.