Wednesday, 1 June 2005
Black and ethnic minority start-ups reach record high
Barclays found the number of BME start-ups increased from 32,000 in 2000 to 50,000 in 2004 - and they now account for 11 per cent of all new businesses.According to Louise Fowler, Barclays' small business marketing director, the rise in BME businesses is due to a rise in the number of young BME entrepreneurs. "There are now more than twice as many running their own business compared to their white counterparts," she said."They are focusing on being innovators in professional services and catering, unlike the older generation where almost half are retail entrepreneurs."Almost a quarter (23 per cent) of BME start-ups were in the catering industry. Other key sectors included retail (16 per cent), and business and professional services (14 per cent).Regionally, London has the highest number of BME businesses, accounting for 38 per cent of all new ethnic-owned enterprises in the UK, followed by the West Midlands, the South East and the North West.Michael Barrows, spokesperson for Birmingham Chamber of Commerce's African Caribbean Business Forum said the growth in BME start-ups was due to a greater awareness of government support available through Business Links and development agencies."Access to funding has also become easier," said Barrows. "BME start-ups are finding it easier to raise the money they need, with organisations such as the Community Development Finance Association willing to lend them money."A recent report from Warwick Business School found that ethnic minority-owned firms pay a lower rate of interest on business bank loans than white-owned businesses.But while BME firms may receive preferential interest rates, according to Barclays the majority of BME start-ups (61 per cent) feel they receive less money for performing the same functions as their white counterparts.
- For advice on raising start-up finance for minority groups in deprived areas visit www.cdfa.org.uk
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