New research by Love Energy Savings shows that the City of London boasts the cheapest commercial gas and electricity prices while Liverpool business have to pay the most for their energy.

An impressive 5,295 startups were launched in Birmingham in 2014 – significantly higher than second-placed Leeds with 4,275. However, the ‘Second City’ also reported nearly 4,000 enterprise deaths in the same year. Love Energy Savings MD Phil Foster comments on the cost of establishing a small business in 2016, as new British Business Bank report shows that lending conditions are improving.

New research undertaken by business energy comparison specialists Love Energy Savings has highlighted the most and least expensive places to run a small business in the UK.

The organisation used a combination of its own regional energy price data and official government statistics to reveal the best locations for startups, focusing on major cities in each region of the country.

Love Energy Savings data showed that, surprisingly, businesses in the City of London benefit from the cheapest annual energy bills, coming in at £2,574. Less shockingly, companies in the same region have to pay more for their talent, with the average weekly wage standing at £870 – double that of most other cities assessed as part of the report.

On the flipside, businesses in Liverpool have to fork out the most for their annual business energy bills. Merseyside-based organisations pay an average of £3,209 per annum – £635 more than their City of London counterparts. Aberdeen – a city that is intrinsically linked to the UK’s energy industry – is the only other city to surpass the £3,000-a-year average commercial energy bill threshold.

Love Energy’s analysis also took into account the number of startups being launched and dissolved in each city, as well as the four-year average survival rate. Latest government statistics (from 2014) showed that Birmingham led the way for business startups with 5,295 being launched in the city throughout the year. However, this was offset by 3,925 closures – the highest in the UK by quite a stretch.

Aberdeen appears to be the place where small enterprises stand the best chance of success, with the four-year survival rate standing at 53.1 percent. Norwich – with a rate of 49.4 percent – was next in the list, followed by Bristol (48.4 percent).

You can find the full analysis attached in pdf format. You can also read a summary of the results on the Love Energy Savings Blog.

These findings are published shortly after the British Business Bank revealed that the market for small business finance is steadily improving, although significant challenges remain. The organisation also confirmed that 350,000 new enterprises wereregistered in the UK in the last year, taking the overall small business population to 5.4 million. Phil Foster, MD at Love Energy Savings, believes the outlook is brightening for entrepreneurs, but it’s still vitally important that small business owners make financial savings wherever possible.

“Our latest research shows that companies’ financial overheads differ greatly depending on where they are based geographically, as does the overall survival rate,” he commented.

“The fact that a small business in Liverpool pays over £600 more for its energy each year than a similar company in the City of London demonstrates just how unpredictable the energy industry can be. To get any business off the ground, you have to maintain a tight grip on your finances, and it always pays to shop around for cheaper deals and discounts – whether that’s on your commercial gas and electricity bills or any other unavoidable business expense. “Hopefully, we’ll soon see a dramatic drop in the number of small businesses that close their doors each year.”