More than 4,300 new businesses were set up in Wales in the first quarter of 2022 – with almost half registered in March alone – according to new research from insolvency and restructuring trade body R3 in Wales.

The figures, which are based on an analysis of data provided by Creditsafe, show the number of start-ups in Wales have risen from 372 in January to 2,116 in March – an increase of 469%, which is the biggest percentage change in any region or nation across the UK.

Wales also had the second highest rise in newly established firms between December 2021 and March 2022 with an increase of 385%, falling only behind the West Midlands which saw an increase of 462%.

The R3 research also indicates that insolvency-related activity, which includes liquidator appointments, administrator appointments and creditors’ meetings, remains relatively low in Wales when compared to the rest of the UK.

In the first three months of 2022 there were 266 insolvency-related activities in Wales – the second lowest of any UK region or nation, behind Northern Ireland, which only had 44.

The data also showed an increase of 123% in insolvency-related activities between March and February of this year and an increase of almost 200% between March and January.

R3 Chair for Wales Charlotte May comments: “I’m delighted to see that despite the financial impact of the pandemic, entrepreneurism in Wales continues to grow.

“The first three months of the year have seen a tidal wave of business activity and it’s inspiring to see new business owners taking the opportunity to respond to new opportunities and changing consumer demands.”

Charlotte, who is Associate Director for South West and Wales at Manolete in Bristol, continues: “While the number of start-ups is encouraging, we are also seeing insolvency levels in Wales slowly increase too, which, given the current economic climate, is not surprising.

“Between increased creditor pressure, low consumer spending and rising inflation, this is the most difficult period for businesses since the height of the pandemic.

“Anyone thinking about setting up a new business should not be discouraged but should certainly be prepared for a challenging year. The first few months of trading are always tough and the current economic pressures will only amplify these struggles.

“Business owners in Wales noticing signs of financial distress should not struggle alone. Financial difficulties don’t go away without intervention and by seeking advice from a qualified, regulated source at the earliest point there will be more options available to help resolve the issue and hopefully return the business to a healthier position.”