Business Administration Booms in UK: Top Cities to Start a Business by 2025

Business administration and support are driving a new entrepreneurial wave across the UK. Cities like Manchester, Birmingham and London have emerged as hubs of this rapidly growing sector.

Funding Circle’s latest insights reveal that, while London continues to dominate in terms of volume, smaller cities such as Brighton, Oxford and Manchester are gaining a reputation for being thriving entrepreneurial hotspots, especially in the business services sector. These cities have several advantages, including lower operating costs, greater access to talent and proximity to regional economies.

Business Administration is the UK’s fastest-growing sector for startups

Business administration and support services will see the largest increase of new businesses in 2024.

Administrative services are in high demand, from HR and payroll, to IT support and outsourcing operations, as well as virtual assistance.

• Remote and hybrid work is on the rise

• The rise of SMEs that are looking to cut overhead

• Demand for flexible and scalable business solutions is increasing

• Automation, cloud-based software and digital tools are advancing.

Many companies are outsourcing administrative tasks to third parties to streamline processes and concentrate on core activities. This creates lucrative opportunities for entrepreneurs.

Sector Growth Snapshot (2019 vs. 2020)

This is a reflection of a growing trend in business: Organisations are increasingly outsourcing their non-core functions to reduce fixed costs and remain agile. This model is especially attractive to early stage companies and small businesses.

Hotspots for Business Services

London will remain the business capital, with 66.920 new companies launched by 2024. However, the areas outside of the capital are experiencing a strong growth in business administration.

Greater Manchester

Manchester is a key destination for businesses seeking support services. It benefits from a large talent pool, an expanding tech ecosystem and low costs. In 2024, it registered 32,940 businesses, many of which were focused on media, admin and tech consulting.

West Midlands (Birmingham),

West Midlands continues its trend of attracting service-led SMEs. Birmingham’s centrality, accessibility to transport links and diversity of workforce makes it an ideal choice for new business support startups.

London

It is still a stronghold for startups in particular the legal, finance and consulting fields. The business administration sector is still strong in this country, due to the sheer number of companies that need outsourced services.

Jerome Fernandez, Funding Circle, comments: “The growth and development of new businesses are essential for the UK’s economy. Entrepreneurs need access to financing to make their dreams a reality. Data suggests that despite recent challenges there is a positive outlook. ONS business insight revealed that 22% trading businesses anticipate their turnover will increase by March 2025 and 20% expect overall performance to grow within the next 12 months. Data highlights the resilience of UK business owners, regional changes in business dynamics and the importance of policy and financial initiatives to encourage and sustain business growth.

The right location for your business is essential to its success. Consider the type of services you provide, the competition level in the area, and how well they fit into the local market. “While concerns about taxation and rising prices persist, a credit card for business can provide a flexible financial safety-net, helping entrepreneurs get their businesses off the ground, manage cash flow and keep them running smoothly.”

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