The Entrepreneurial Spirit of the UK

Entrepreneurial opportunity: demand and growth opportunities

We wanted to go a stage further to analyse where growth opportunities existed for various businesses in different sectors by doing two things, the first was analysing individual SIC codes (standard industrial classification of economic activities) to see which business sectors were thriving in 2021 by the number of new companies formed in each sector.

To do this we looked at the SIC code for each company formed in 2021. There are over 600 of these codes that enable businesses registering themselves with Companies House, to provide a code which helps to describe what their business does. As businesses can apply more than one SIC code to their business, this took some sifting through to get to a logical grouping of businesses in different sectors, but has enabled us to show the below table which makes for interesting reading.

Number of companies formed in 2021 in each sector

Sector Number of companies formed
Retail 119,948
Professional services 116,669
Real estate 109,570
Commercial services 67,858
Hospitality 64,404
Construction 61,035
Wholesale 45,578
Information and communication 37,715
Manufacturing 36,583
Health and social work 36,573
Transportation and storage 35,594
Financial and insurance 35,448
Trades 31,999
Arts, entertainment and recreation 26,480
Other service activities 25,537
Education 20,473
Automotive 20,424
Scientific and technical 15,189
Hair and beauty 11,841
Agriculture, forestry and fishing 5,996
Domestic services 3,844
Water supply and sewerage 2,979
Public admin and defence 2,832
Electricity, gas, steam and air conditioning 2,298
Mining and quarrying 1,297

The vast, varied and flexible retail industry bounced back in a big way in 2021 after a very uncertain pandemic-hit 2020. Many businesses had to pivot their offerings to online-only to reflect the changing state of our high streets and, thanks to this, growth in the industry shows no sign of abating. Clothing stores sales volumes reached above pre-coronavirus levels for the first time in November 2021, whilst other retailers such as computer stores, toy stores and jewellery stores, reported sales volumes were 20.6% above February 2020 levels.

Perhaps most interestingly, the real estate sector incorporating estate agents and property management solutions was a significant growth sector. UK house prices in 2021 showed their fastest growth rate in 15 years, mirrored by the impressive 109,570 companies formed in this sector to take advantage of an industry buoyed by stamp duty holidays and the UK’s enduring love for all things bricks and mortar.

We wanted to drill down still further into eight key sectors (including real estate) to see where the demand is and where the opportunity lies for varying types of businesses within these sectors. To do this, we looked at Google search demand for numerous businesses in all major UK towns and cities e.g. ‘architect in Ipswich’ to show us the demand. We then compared this demand to the amount of Google listed businesses of that type in each place, to give us an overall number of ‘searches per business listing’. We’ve included the top five most searched for businesses in each of the eight sectors we have selected so if you’re a budding architect wondering where to set up your practice to maximise opportunity, you’ve come to the right place.

Professional services is a broad term including businesses within the service sector but, where special training is required, or a specialist skill is the core product being sold. We looked at search demand and business listings for over 25 popular types of business in this sector from marketing agency to IT consultant however, we have focused on the top five from a search demand perspective for each sector.

Surveyors were seriously in demand in 2021 and if you’re looking to set up a Chartered Surveyors in 2022 or beyond, then you could do well in the cathedral city of Peterborough where there are 79.80 searches for a surveyor per listing of actual Surveyors available. Nottingham offers the best opportunity for new Solicitors’ firms, whilst Architects are in high demand in Chester, Milton Keynes, and the Scottish city of Kilmarnock. Demand far outstrips supply of Private Investigators in Chester, St Albans, and Bath (we won’t ask why) and for Graphic Designers in the South Yorkshire town of Doncaster.

Business Type Top three locations based on searches per listing
Surveyor 1. Peterborough (79.80)
2. Milton Keynes (75.86)
3. Kirkcaldy (63.00)
Private investigator 1. Chester (2420)
2. St Albans (1680)
3. Bath (1323.33)
Solicitor 1. Nottingham (34.80)
2. Doncaster (32.78)
3. Oldham (32.24)
Architect 1. Chester (74.53)
2. Milton Keynes (48.40)
3. Kilmarnock (34.55)
Graphic designer 1.  Doncaster (20.14)
2. Llandrindod Wells (20.00)
3. Milton Keynes (18.97)

What an incredible year the property industry had in 2021, unprecedented growth across the board leading to record house prices and demand far outstripping supply. If you’re in, or are looking to get in the lettings industry then heading north seems to be a safe bet. There seems to be great opportunity in Falkirk, Hereford and Newcastle upon Tyne where people are searching for agents but getting less choice per search than anywhere else in the country. For budding Estate Agents looking to set up their own firms then the West Midlands town of Worcester is seeing high demand with 56 searches per existing Estate Agent.

Business Type Top three locations based on searches per listing
Property to rent 1. Falkirk (262.50)
2. Newcastle upon Tyne (261.59)
3. Belfast (259.11)
Estate agent 1. Worcester (56.19)
2. Hereford (44.90)
3. Gloucester (38.29)
Lettings agent 1. Hereford (22.00)
2. Kirkwall (16.00)
3. Kilmarnock (13.53)
Property management 1. Llandrindod Wells (5.36)
2. Milton Keynes (4.34)
3. Nottingham (4.28)
Property to buy 1. Kirkcaldy (4.82)
2. Stevenage (2.76)
3. Milton Keynes (2.46)

This is another broad sector, spanning businesses that provide services to other businesses in the fields of logistics, stock management and transportation. It seems that in 2021, warehouse space was a key consideration, particularly for businesses in the beautiful Somerset city of Bath. Oldham, just outside Manchester, is most in need of new recruiters and business insurance firms and if you’re in the business of waste management (or planning to be) then you have an excellent geographical spread to pick from. Kilmarnock in western Scotland, north of London in Milton Keynes or Truro, all the way down in Cornwall are most in need of new companies in that sector.

Business Type Top three locations based on searches per listing
Warehousing 1. Bath (294.74)
2. Chelmsford (219.63)
3. Southend-on-Sea (211.18)
Recruitment 1. Oldham (26.41)
2. Llandrindod Wells (18.00)
3. Peterborough (14.40)
Logistics 1. Southend-on-Sea (12.63)
2. Nottingham (11.53)
3. Belfast (8.35)
Business insurance 1. Oldham (11.57)
2. Bolton (8.65)
3. Wakefield (8.15)
Waste management 1. Kilmarnock (34.67)
2. Milton Keynes (25.00)
3. Truro (16.00)

Perhaps surprisingly, Hospitality was the 5th largest sector in the UK in 2021 in terms of new businesses registered with Companies House. Despite the ongoing pandemic making life unpredictable for this sector, there is still huge demand for the classic luxuries in life of eating and drinking out in a social environment.

Reading is far and away the best place to open a new restaurant based on search demand versus current available options whilst Wigan needs more hotels and people in Oxford could do with more pubs and cafes. Thinking of opening a bar but not sure where? Newcastle upon Tyne is revered for its party atmosphere and, although already well stocked for drinking establishments, definitely has room for more!

Business Type Top three locations based on searches per listing
Restaurant 1. Reading (1153.91)
2. Bournemouth (999.54)
3. Bath (955.48)
Hotel 1. Wigan (2762.07)
2. Oldham (2300.00)
3. Milton Keynes (2269.01)
Pub 1. Oxford (523.36)
2. Milton Keynes (479.70)
3. Brighton (452.74)
Bar 1. Newcastle upon Tyne (422.54)
2. Belfast (413.97)
3. Bournemouth (365.16)
Café 1. Oxford (357.20)
2. Brighton (335.20)
3. Bath (294.19)

The people of Falkirk certainly seem in need of more firms offering financial advice with over eight searches per listed firm, closely followed by Darlington and Dorchester. Fund management is a specialist but potentially lucrative business venture and Gloucester is marginally the best place to set up a firm offering this service, although Doncaster or Dorchester are good bets too.

Business Type Top three locations based on searches per listing
Bank 1. Oxford (64.73)
2. Nottingham (62.79)
3. Slough (60.48)
Financial advisor 1. Falkirk (8.07)
2. Darlington (6.31)
3. Dorchester (5.83)
Insurance broker 1. Llandrindod Wells (30.00)
2. Kirkwall (20.00)
3. Oldham (13.50)
Pensions advisor 1. Kirkcaldy (10.00)
2. Wigan (8.67)
3. Hereford (8.33)
Fund management 1. Gloucester (60.00)
2. Doncaster (50.00)
3. Dorchester (50.00)

With the UK property boom in full swing in 2021, tradespeople have seen an unprecedented demand for their services which has helped to offset the challenges they’ve faced with prices for raw materials consistently on the rise. The data here is unequivocal, if you’re looking to set up a business in the trades then the beautiful city of Belfast offers a fantastic opportunity with demand outstripping supply in three of the five most searched for trades (plumbers, handyman and welder).

Business Type Top three locations based on searches per listing
Plumber 1. Belfast (31.60)
2. Milton Keynes (27.07)
3. Newcastle upon Tyne (25.57)
Carpenter 1. Milton Keynes (27.20)
2. Peterborough (24.64)
3. Belfast (23.56)
Handyman 1. Belfast (60.25)
2. Nottingham (39.41)
3. Wakefield (35.56)
Plasterer 1. Salisbury (50.32)
2. Belfast (48.56)
3. Oxford (42.89)
Welder 1. Belfast (70.42)
2. Milton Keynes (60.00)
3. Newcastle upon Tyne (48.29)

Whilst the automotive sector and the businesses we’ve analysed are varied, the data points to one town time and time again. Whether you’re setting up a car wash, a garage or looking to offer driving lessons, the Buckinghamshire town of Milton Keynes is an outstanding location for all things car-related. It tops our demand versus supply lists for every single automotive business which makes a lot of sense since the town was designed with driving in mind and has strong ties to Formula One and a host of popular car brands.

Business Type Top three locations based on searches per listing
Car wash 1. Milton Keynes (334.04)
2. Salisbury (262.86)
3. Bath (257.95)
Car rental 1. Milton Keynes (263.70)
2. Canterbury (220.00)
3. Oxford (178.78)
Garage 1. Milton Keynes (64.44)
2. Newcastle upon Tyne (61.64)
3. Bournemouth (53.56)
Driving lessons 1. Milton Keynes (84.62)
2. Bath (75.52)
3. Truro (58.89)
Mechanic 1. Milton Keynes (35.96)
2. Belfast (30.64)
3. Nottingham (15.52)

It turns out that the residents of Milton Keynes are not just looking for car washes and mechanics, they also care deeply about their hair and beauty, particularly barbers, hairdressers and ear piercing. If you’ve got the necessary skills to offer the niche service of improved teeth whiteness then people in Northampton, Wigan and Oldham would love more businesses offering just that.

Business Type Top three locations based on searches per listing
Barber 1. Milton Keynes (176.67)
2. Oxford (165.20)
3. Guildford (149.73)
Hairdresser 1. Oxford (86.39)
2. Milton Keynes (84.59)
3. Nottingham (73.11)
Ear piercing 1. Milton Keynes (266.30)
2. Kilmarnock (172.31)
3. Doncaster (170.43)
Teeth whitening 1. Northampton (83.37)
2. Wigan (67.36)
3. Oldham (54.41)
Waxing 1. Nottingham (16.65)
2. Milton Keynes (16.52)
3. Oldham (16.00)