TheEssay: What makes the North so entrepreneurial?

I reckon that Fenella Renwick and Kirsty Scobie have picked one of the most picturesque locations in the North of Scotland for The Seafood Shack. From their pitch behind the ferry terminal in Ullapool, the two young entrepreneurs are serving crabs, langoustines, scallops and other local seafood to locals and tourists alike, just a short walk away from the beautiful Loch Broom.

They raised £7,500 of crowdfunding to launch their business last year and haven’t looked back since.

“We had so much support, right from the very start – it was a bit of a whirlwind,” explains Ms Renwick, 27, who was head chef at The Waterside seafood restaurant in Kyle of Lochalsh and whose partner catches scallops for the shack.

“We always felt there was a big gap in the market in Ullapool for fresh seafood and shellfish. Everything is being landed in Ullapool but then going away on the back of a lorry to France or Spain.

“We knew we wanted to do something mobile so we could take the catering trailer to festivals and have a bit of fun at galas. We didn’t want the pressure of having big premises at the start.”

Television chef Mary Berry visited The Seafood Shack for the first episode of her new series on BBC2, which was shown last month. Ms Scobie, 26, and her partner, Josh, who is also a fisherman, served langoustines to the national treasure on the beach.

“It was scary to start our own business because it was the unknown,” admits Ms Renwick. “There are a lot of curve balls that come your way, but they make you stronger and more aware of what you need to do – it makes you more determined.

“Starting a business isn’t as scary as it sounds. Working for yourself is great.”

Starting a conversation

Ms Renwick and Ms Scobie are just two of the large number of business people in the North of Scotland who run their own companies. A recent report by the Federation of Small Businesses (FSB) hailed Ullapool as the “most entrepreneurial town in Scotland”, with 17.9% of people listed as self-employed.

Newtonmore came in second with 17.2%, while Fortrose on the Black Isle took eighth spot with 13.9%, just ahead of Cullen in Moray in ninth position. The FSB used data from the 2011 census to analyse self-employment levels throughout the country and found that people living in rural areas were more likely to work for themselves, with those in post-industrial areas with high deprivation among the least likely to run their own businesses.

“We wanted to start conversations about local economies, local self-employment and local entrepreneurship,” explains Barry McCulloch, senior policy advisor at the FSB and the author of the report. “At the moment, the conversation around employment is stuck in a loop about whether employment is going up or down.

“We wanted to shift that conversation to look at localities – which towns are doing well and which are lagging behind? We found a massive gap between the towns in rural Scotland and towns in post-industrial communities in the Central Belt, which typically have a whole host of socio-economic challenges and aren’t fertile places to start a business.

“What’s astounding about the results for rural areas – think of Ullapool, Newtonmore or even Comrie – these are areas whose infrastructure is not up to the same level as urban areas. The transport connections are weak, super-fast broadband either doesn’t exist or is patchy – so these areas are doing well despite having poor infrastructure.”

Mr McCulloch also looked at last year’s Scottish Government data on self-employment broken down into council areas. He found the more-recent figures were 3-4% ahead of the 2011 data, suggesting the level of self-employment has increased since the last census.

‘Business crofting’
But are Highlanders, islanders and their neighbours in Moray really more entrepreneurial than people living in other parts of Scotland? Mr McCulloch points to an attitude of “We’ve just got to get on with it” – rural towns are often isolated from one another and from the big cities, with fewer large employers and so more impetus to start a business.

It’s a view that’s shared by Stewart Nicol, chief executive at Inverness Chamber of Commerce. “We’ve got a long-standing tradition of being self-employed in the Highlands – it’s just the way we do business,” he says.

“All sorts of businesses of all sizes and in all sectors, going back for decades, have been used to overcoming the challenges of rurality – distance from market, lack of transport, lack of digital infrastructure – there’s a mindset within the Highland business community that says we’re just going to get on and do things.”

Mr Nicol also highlights the importance of “business crofting” – large numbers of people living in rural areas will have more than one job or run more than one business. “That again lends itself to more self-employment and a more entrepreneurial approach to doing business,” he says.

It’s become a bit of a cliché, but when tourists come on holiday to the Highlands and fall in love with the North of Scotland then the seed is planted in their minds to move here. If they’re self-employed then that will usually mean bringing their business with them too.

“These people tend to be resourceful, adventurous, go-getting types for whom self-employment is second nature,” explains David Richardson, the FSB’s Highlands and islands development manager. “This explains why tourism honeypots like Ullapool and the North-West Highlands or Newtonmore and the Cairngorms national park score so highly.”

Mr McCulloch points out: “These people tend to be criticised in terms of economic development, but actually they’re trying to achieve a better work-life balance and they bring assets and expenditure with them, which for these towns is absolutely crucial. We surveyed our tourism members in 2014 and found there were people traveling quite big distances to start their businesses – they were doing that because it wasn’t just the commercial side, it was the lifestyle.”

Mr Nichol agrees: “We’ve got a strong and dynamic business mix in Inverness and across the Highlands now and I think there are genuine opportunities. It’s a fantastic place to bring up a family and do business.”

Rising figures
Across the border in Moray, Business Gateway’s senior area business manager, Craig Robertson, points out that the report offers a snapshot of a single point in time. He thinks that, since the last census was taken, the number of people setting up businesses in the area will have increased.

“I was surprised to see Cullen come out as a hot-spot,” he admits. “Nothing wrong with Cullen, but it was a very odd thing to happen.

“Our conversation rate is normally around 20% of the people who make inquiries actually go into self-employment. Not everybody who comes through our door goes into self-employment.

“Part of our job is to challenge whether it’s right for them and the viability of their idea. That conversion rate went up to 32% during the first two quarters of this financial year.

“That told me there was a shift from people who were coming out of the oil industry during the downturn and asking themselves what skills they had and whether they were transferable to allow them to go self-employed. To that end, rather than going for a job, you could say people in Moray are more entrepreneurial because they’re thinking outside the box and using their skills to start something up for themselves.”

Mr Robertson said that tradesmen – such as electricians and plumbers – would often start businesses after leaving the oil industry. He also highlighted the growth of the creative sector in Moray, including filmmakers, photographers and artists.

The ‘gig’ economy
Perhaps living in the North of Scotland does trigger an element of entrepreneurialism. If you’re used to being self-reliant then the idea of setting up your own business perhaps seems less scary.

But Fraser Grieve, Highlands and islands director at the Scottish Council for Development & Industry (SCDI), sounds a note of caution. “I’d be reluctant to say that high levels of self-employment equate with high levels of entrepreneurialism,” he warns.

“They probably show ‘higher’ levels, but part of that might be through necessity rather than choice. In these places, there is probably a bigger prevalence of the ‘gig economy’.

“If someone has a business that operates online then they may choose to move to a rural area. They could be anywhere in the world so why not make it Ullapool?

“But there could be people cleaning accommodation or working in a bed and breakfast who would like more work but that work simply isn’t available. For some, there are clear benefits of the gig economy, but it all comes down to whether they’re in that space through their own choice – because it gives them flexible working, gives them a better work-life balance or fits in with other roles they do – or whether they’re in that not through choice and would rather have a full-time job or other mode of working.”