The 15 best cities to start a business in 2018

Data Insights 2 January 2018

It’s no secret starting a business is tough: more than half of UK start-ups don’t survive the first five years, with aspects like rental prices, utility bills, consumer demand, and poor cash management getting the better of budding entrepreneurs.

Choosing the right location is key, and can be the difference between success and failure for a small business. Check out our roundup of the best cities to launch a start-up in 2018 to find out where your SME dreams might just take off.

 

15. Liverpool

The fifth-largest metropolitan area in the UK, Liverpool is a booming city that has a healthy tourist trade as well as a thriving business network. It’s loved by locals and visitors for its industrial heritage and modern retail scene.

  • 5-year start-up survival rate: 38.6%
  • Average gross weekly pay: £509.20
  • Self-employed rate: 6.8%
  • Population: 484,600
  • Average utility bill (1 bed flat): £149.90
  • How ‘rich’ is Liverpool? £232.7m earned by working professionals each week

 

14. Manchester

Greater Manchester has the third-largest population in England and is known for many economic and cultural achievements, including contributions to science and engineering, music and art, and, of course, football…

  • 5-year start-up survival rate: 38.9%
  • Average gross weekly pay: £570.80
  • Self-employed rate: 7.5%
  • Population: 541,300
  • Average utility bill (1 bed flat): £148
  • How ‘rich’ is Manchester? £288.6m earned by working professionals each week

 

13. Birmingham

Birmingham has always been known as a strong contributor towards the UK’s manufacturing and engineering revenue. With England’s second-largest population, it’s also home to several major exhibition facilities and has a strong business, tourism, and retail economy.

  • 5-year start-up survival rate: 39%
  • Average gross weekly pay: £523
  • Self-employed rate: 8.6%
  • Population: 1,124,800
  • Average utility bill (1 bed flat): £140.30
  • How ‘rich’ is Birmingham? £544.2 earned by working professionals each week

 

12. Cardiff

Cardiff is Wales’ driving economic force, and thousands of people commute from the outskirts to work in the capital. Though its roots are in coal and steel, the main industries that keep the city going today are retail, finance, and tourism.

  • 5-year start-up survival rate: 41.4%
  • Average gross weekly pay: £528.80
  • Self-employed rate: 7.2%
  • Population: 361,500
  • Average utility bill (1 bed flat): £95.40
  • How ‘rich’ is Cardiff? £180.5m earned by working professionals each week

 

11. Sheffield

A former pillar of the industrial north, Sheffield has reinvented itself as a modern hub for tech, retail, tourism, and business. Home to two universities, it also has a thriving youth culture.

  • 5-year start-up survival rate: 42.3%
  • Average gross weekly pay: £526.60
  • Self-employed rate: 7.9%
  • Population: 575,400
  • Average utility bill (1 bed flat): £132.30
  • How ‘rich’ is Sheffield? £286m earned by working professionals each week

 

10. Southend-on-Sea

Southend Pier is the longest leisure pier in the world, but the town has far more to offer than just holiday delights. Excellent commuter links make it easy to get to from London, and the coastal surroundings mean it’s especially great for tourism.

  • 5-year start-up survival rate: 42.4%
  • Average gross weekly pay: £573.20
  • Self-employed rate: 10.3%
  • Population: 179,800
  • Average utility bill (1 bed flat): £137.30
  • How ‘rich’ is Southend? £97.9m earned by working professionals each week

 

9. Newcastle upon Tyne

Newcastle’s heritage includes far more than industry – with Europe’s biggest shopping centre, the Metrocentre in nearby Gateshead, as well as the biggest John Lewis and Tesco in the UK, it’s a retail haven that also has a strong business and service employment economy.

  • 5-year start-up survival rate: 42.5%
  • Average gross weekly pay: £532.50
  • Self-employed rate: 7%
  • Population: 296,500
  • Average utility bill (1 bed flat): £149.40
  • How ‘rich’ is Newcastle? £146.7 earned by working professionals each week

 

8. Milton Keynes

Milton Keynes has one of the country’s most successful economies, with an especially healthy track record for SMEs. A business-oriented town, the professional, scientific, and technical sectors are a main focus, along with retail.

  • 5-year start-up survival rate: 42.6%
  • Average gross weekly pay: £602.40
  • Self-employed rate: 9.7%
  • Population: 264,500
  • Average utility bill (1 bed flat): £165.70
  • How ‘rich’ is Milton Keynes? £152.6m earned by working professionals each week

 

7. Bristol

Once a busy port city that exported goods all over the world, Bristol is now one of the most profitable economies in the UK with a thriving business scene that’s especially based on IT, financial services, and tourism.

  • 5-year start-up survival rate: 43.8%
  • Average gross weekly pay: £539.90
  • Self-employed rate: 10.4%
  • Population: 454,200
  • Average utility bill (1 bed flat): £142.80
  • How ‘rich’ is Bristol? £233.9m earned by working professionals each week

 

6. Leeds

With one of the UK’s fastest growing economies, Leeds is home to a diverse community of thriving businesses. One of the country’s biggest financial centres, its also has a strong foundation in the tourism, legal, and retail sectors.

  • 5-year start-up survival rate: 44.2%
  • Average gross weekly pay: £507.80
  • Self-employed rate: 8.4%
  • Population: 781,700
  • Average utility bill (1 bed flat): £122.10
  • How ‘rich’ is Leeds? £378.7m earned by working professionals each week

 

5. Edinburgh

Edinburgh rivals London’s strong economy, high gross value added (GVA), and professional workforce. As a World Heritage Site and host of the famous Fringe Festival, tourism is a highly important sector, but the city is also a major player in financial services.

  • 5-year start-up survival rate: 44.2%
  • Average gross weekly pay: £598.50
  • Self-employed rate: 7.3%
  • Population: 507,200
  • Average utility bill (1 bed flat): £102.40
  • How ‘rich’ is Edinburgh? £292m earned by working professionals each week

 

4. Leicester

Leicester has a strong heritage in textiles and shoes, and industry still plays a huge role in the city’s economy, along with engineering and retail. The largest city in the East Midlands, it’s famous for its cultural diversity and the bustling centre attracts locals and tourists alike.

  • 5-year start-up survival rate: 44.4%
  • Average gross weekly pay: £497.90
  • Self-employed rate: 5.2%
  • Population: 348,300
  • Average utility bill (1 bed flat): £159.50
  • How ‘rich’ is Leicester? £166m earned by working professionals each week

 

3. Brighton & Hove

Perched on the South Coast, Brighton & Hove is far more than just a commuter hub for those who work in London, and has an active economy of its own that thrives on tourism, retail, and digital innovation.

  • 5-year start-up survival rate: 45.9%
  • Average gross weekly pay: £577.90
  • Self-employed rate: 16%
  • Population: 289,200
  • Average utility bill (1 bed flat): £149.40
  • How ‘rich’ is Brighton & Hove? £158.8m earned by working professionals each week

 

2. Bath

A World Heritage Site and one of the most famous cities in the world, it’s no surprise that tourism is the main driver behind Bath’s economy. However, software, publishing, retail, and business services also thrive here.

  • 5-year start-up survival rate: 49.1%
  • Average gross weekly pay: £543.30
  • Self-employed rate: 12.5%
  • Population: 187,100
  • Average utility bill (1 bed flat): £109.70
  • How ‘rich’ is Bath? £97.6m earned by working professionals each week

 

1. Aberdeen

Aberdeen is the best place to launch a start up in the UK. With roots in the fishing, textiles, and shipbuilding industries, Aberdeen has reinvented itself to become one of Scotland’s leading centres for business. It now is a leading place for technology, with a focus on electronics design and development.

  • 5-year start-up survival rate: 53.5%
  • Average gross weekly pay: £583.90
  • Self-employed rate: 7.7%
  • Population: 229,800
  • Average utility bill (1 bed flat): £195.30
  • How ‘rich’ is Aberdeen? £127.7m earned by working professionals each week

In summary

Obviously, location is an important factor in determining a start-up’s success – businesses need to situate themselves in a place that makes it convenient for them to carry out their services, while making it easy for customers to access them. Here is a guide on how to find the best small business premises.

“It’s all about getting the right balance,” says Guy Moreve, our Head of Marketing. “You need to find somewhere that fits in with your target demographic, but is also sustainable for you.

“The cities we’ve outlined stand out because they are places that already have an established business community with a pool of potential customers, and yet they still have potential for further growth. To be successful, entrepreneurs need to find their niche within these places, put together a comprehensive plan, and work hard to execute it.”

The stats: Methodology behind our analysis

To find out which UK cities are best for entrepreneurs looking to start a small business, we carried out extensive research on the business climate in each city, looking into business demography, the UK labour market, and the cost of living in UK cities.

All of these factors helped us to create our start-up shortlist of the best cities for entrepreneurs looking to launch a business in 2018.

Read more: Are you looking to start a business internationally? Have a look at our study on Europe’s most popular startups.

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