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10 of the best UK small business ideas

6-minute read

10 of the best UK small business ideas
Catriona Smith

Catriona Smith

18 January 2021

Looking to start your own business in 2021? At Simply Business, we've delved into some of our own customer data to reveal the latest trends among small businesses and the self-employed to give you inspiration to get started.

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Despite the challenging times, data from the Office for National Statistics showed a dramatic rise in new companies registered in the UK in the second half of 2020. If you’re thinking of joining this entrepreneurial trend, read on to explore top new small business ideas.

Top 10 small business ideas

Food and drink small business ideas

Food and drink businesses have had to adapt and pivot throughout the coronavirus outbreak. Many independent cafes and restaurants began selling produce from their space or went takeaway only. It’s changed how we view food in the UK and many of us have been inspired by the focus on local, homemade, and seasonal produce.

But what’s the best business to start? We’ve picked out a couple of inspiring ideas.

What business should I start?

1. A home baking business

Like many businesses, bakeries have felt the effects of Covid-19. But demand has remained relatively high for baked goods, so many new entrepreneurs started a baking business from home.

Cake decorating businesses also seem to be on the rise. Many had to adapt during the pandemic by reviewing the range of cakes they sell, increasing prices, and avoiding bespoke orders.

What about upcoming trends? A recent survey from Craft Bakers Association found 83 per cent of surveyed respondents believe nostalgic flavours will be popular in 2021. Think Black Forest gâteau or cherry bakewells.

You can also expect vegan products to be increasingly popular, boosted by the annual Veganuary campaign and more people choosing a ‘flexitarian’ diet. Higgidy’s vegan quiche and Cooplands cream cake, for example, launched earlier this month.

Inspired? Head to our 10-step guide to starting a baking business from home for what to do next.

2. Takeaway and delivery

It’s no surprise that demand for takeaway food businesses soared in 2020. While the food and drink industry has had a challenging year, many pubs, cafes and restaurants managed to adapt to offer deliveries during lockdown.

In last year’s Summer Statement announcement from Chancellor Rishi Sunak, VAT was reduced from 20 to five per cent up for food, accommodation and attractions. And this temporary reduced rate for hospitality and tourism has now been extended to 31 March 2021. The move is designed to support recovery in these industries and encourage demand.

Interested? Read our guide on how to start a takeaway business and check our coronavirus guidelines for restaurants and cafes,which includes food to go.

You can also check food and drink industry insurance information.

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Creative small business ideas

Covid-19 forced many people to wonder how they could turn their creative hobbies into a lucrative business. According to a survey from desktop factory specialist Mayku, 28 per cent of people in the UK considered starting a creative business since the outbreak of the pandemic.

What skills do you have that could help you become your own boss, setting up a business from home?

What business should I start?

3. A homemade candle business

A need for escapism, creativity and relaxation saw people turning to candle making during the coronavirus pandemic. And whether out of necessity or an inner entrepreneurial spirit, many of these hobbyists started selling their candles online.

Interested in starting a homemade candle business? Read about insurance for craft businesses.

4. A jewellery business

In terms of small business ideas from home, jewellery making is a popular choice for artists looking to supplement their income. It’s creative and you’ll get to use a range of metals, precious stones, and techniques to create designs that you’re passionate about.

The cost of setting up your jewellery business depends on equipment and materials – plus you’ll need to consider how much you could sell each item for. As a guide, jewellery makers make an average of £44.34 earned per item sold, according to a survey from DIYs.com.

You’ll want to consider whether you want to sell online or at craft fairs, or both. Either way, take a look into insurance for craft businesses so you’re protected.

Independent retail businesses

In 2020, Statista reported that 87 per cent of UK households made online purchases within the preceding 12 months – the highest figure in the UK for the past 11 years. Whether you design your own products or buy and sell from suppliers, here are some small business ideas to consider.

What business should I start?

5. A clothing line

How about starting a clothing company? You get to define your niche, put your creative skills to the test, and start building a brand. While bricks and mortar shops are in difficulty, selling online could be a smart move.

Whether it’s selling second-hand clothes, using responsibly sourced materials, or simply repairing old items, is there a clothing business you could open with sustainability in mind? Read more about starting a clothing line.

6. An online shop

Selling products online can be an excellent business to start on the side if you have the right products and skill set. With shops on the high street suffering unpredictable closures and coronavirus restrictions, an online presence can be a low risk and low cost way to trade.

If you’re in need of inspiration for products you could sell online, our guide includes help to get you started.

Read about how to set up an online shop.

Service business ideas

More people are working from home and shopping online, but what types of businesses are thriving as a result of this change in consumer behaviour? Here are some business ideas to get you started.

What business should I start?

7. A cleaning company

Demand for commercial and residential cleaning has grown in recent years, and it’s likely to continue on that trajectory thanks to coronavirus. With more people working from home than ever before, and a growing number of young professionals with disposable incomes – it’s no wonder that professional cleaning services have seen a surge in popularity.

Want to know more? Read our step-by-step guide on how to start a cleaning company in the UK.

8. A courier company

The Guardian reported this month that online grocery sales now account for 13 per cent of all food sales – up from 7.4 per cent in March 2020, according to Internet industry body IMRG. This trend isn’t just in the food industry – the need for reliable courier and delivery services to transport goods and important documents is also on the up.

Thinking about setting up a courier service? Read our eight steps to becoming a self-employed courier.

You can also check insurance for couriers for more information.

Health business ideas

People are keen to keep fit and use the latest technology to track their progress and goals – we all saw the number of people out jogging during the first lockdown. And while the fitness industry has had to adapt throughout the coronavirus pandemic, it’s worth exploring these health and fitness business ideas for inspiration.

What business should I start?

9. A personal training business

If you’ve got a passion for fitness and the necessary qualifications, you’ll be ready to take the leap into personal training. Although gyms and sports facilities have faced tough times recently, personal trainers have been able to make the most of outdoor training and one-to-one sessions, as well as offering classes remotely.

Read our tips on how to start your own business as a personal trainer and find out about personal trainer insurance.

10. On-demand health and wellness

We’re all used to being able to access films and music on demand – now this is expanding into the health and wellness space. Just think how many wearable technology products and health and wellness apps are available now.

Not only is it a booming industry, but it’s one where people are willing to part with their cash. As The Telegraph reported, “British consumers are expected to spend £487 per head annually on ‘wellness’ by 2022, according to analytics firm GlobalData”.

If you’re an experienced counsellor, life coach, or yoga instructor, for example, you might like to explore digital platforms that offer subscription services like Down Dog and StrideKick, or build up your own YouTube presence.

Interested in learning more? Check out our insurance for the health, fitness and wellbeing industry.

What are your top small business ideas?

The small business ideas in this article are designed to give you inspiration. If you want to explore an idea, make sure you treat it as a business, carrying out the right research and planning – writing a business plan is a great place to start.

Let us know about your favourite small business ideas in the comments below.

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We create this content for general information purposes and it should not be taken as advice. Always take professional advice. Read our full disclaimer

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