TRADITIONAL sun, sea and sand were replaced this year by a new summer S-factor which hit business start-up numbers between April and June, according to Barclays.

A combination of street parties, stock market difficulties and Sven's boys was blamed for an 11 per cent nationwide fall in start-ups compared to the previous year. While some regions fared better than others, the south east was in line with the national average - 11 per cent dip.

Barclays' small business survey found that between April and June 2002, 82,000 businesses started trading in England and Wales; in the same period last year the number was 92,000.

While the nation's spirits were buoyed by the Queen's Golden Jubilee and the World Cup, manufacturing productivity and retail sales were both down in June.

And turmoil in the stock market may have reduced the personal wealth many entrepreneurs rely on to start new businesses.

The main factor preventing start-up numbers from dropping further may have been the buoyancy of the property market and its effect on potential business owners' feeling of financial security.

On the positive side, it is likely that the S-factor will have artificially depressed start-up numbers in the second quarter, with a surge possible in quarter three as entrepreneurs who deferred starting up in June put their plans into action.

Phil Johnson, head of small business for Barclays in Kent says: "From a low point last autumn we've been seeing improvements in the numbers of start-ups in successive quarters. The one-off factors of the extended bank holiday and football fever in June, combined with stock market volatility may have slowed this somewhat."

Business closure numbers rose eight per cent on the previous year with 110,000 firms closing their doors in the second quarter of 2002.