Choosing Which UK City To Start Your First Business

27 May 2026

Toby Patrick

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When it comes to the UK economy at the moment, a lot of prospective owners are probably of the mind that it's not the best time to start a new business. But this isn’t the case across the board. Numerous industries are either experiencing steady, consistent growth or are thriving on the chaos and remaining unfazed, like companies operating within AI and technology spaces.

While the type of industry is no doubt a huge factor that can determine the success of a business, in many cases, a company's location is just as important. Where you choose to settle can be influenced by several factors, from the cost of operations, employee wage expectations, rent, and so much more.

London

The UK’s capital is naturally home to the headquarters of a lot of very successful businesses, but with London’s high business rates, employee wage expectations and rental costs, setting up there can be eye-watering for a small, start-up business.

While some options a bit further out from the city might be more attractive in those aspects, it’s again dependent on the type of business you own. For example, a fashion retailer might thrive in London's city centre, as footfall, tourism, and overall population are higher than in any other major city. That being said, other areas can also be more attractive in terms of costs, such as a shopping centre in Essex and so forth.

It’s also worth noting that in 2023, the average turnover for a small business in London was just over 100,000, with 9% business growth.

Leeds

Known as one of the fastest-growing tech hubs in the North. Within the digital sector alone, there was a 125% growth above the national average, which screams new opportunities to start your own tech business here. Leeds is great for that area of business, but also holds the benefits of competitive business rates, much cheaper rental compared to southern areas, and you have the added advantage of being located in a skilled talent pool of university students, which allows you to build your company, train your business, and also offers affordable wages to begin with as you grow and enter a new market.

Manchester

England's second city and capital of the north is an unsurprisingly hub for a range of industries, with a history of success in the textile industry, but in recent years it has boasted promising opportunities for creative media and fashion, which are both going through periods of consistent growth.

Not to mention that Mancunians love their nightlife, so that would also be a promising opportunity, even if the hospitality industry is struggling by and large, bars in Manchester are having more success, as people there are heading straight to Irish bars for a pint, music and vibes so it’s something to consider for hospitality start-ups.

Fashion, like other cities such as London, is at Manchester’s core, but like other industries, it’s very competitive; that’s why incorporating a creative media element would allow new businesses within this field to thrive there.

Manchester as a whole can be expensive, but there are places where you can find a real bargain for rental units, there are also pretty competitive. It’s also worth considering that in 2023, Manchester's average business turnover was just under £90,000, with 4% growth that year.

Liverpool

Liverpool is another northern powerhouse with potential in a variety of fields and opportunities for professional services, such as tech and cybersecurity. Though it’s still a major UK city, its economy is slightly smaller than that of Manchester, while still growing consistently, but, on the bright side, operating costs are also generally lower.

There is an art to getting your foot in the door without being bled out in the first year on business rates and rent, so Liverpool is a great place to consider starting up. It might be an easier environment in which you can build your reputation, customer base, and make a name for yourself before expanding into other major cities.

Final Thoughts

When it comes to picking which city to start your start up it’s completely dependant on what industry you want to emerge into, what you can afford in terms of business rates, wage expectations and rent prices, as while you might not turn a profit in your first year or two, you don’t want to dig yourself into a hole that will burnout your business before you’ve even started.

The vast majority of cities tend to be tech and financial hubs, which just comes with the modern-day expectations and overall growth, but there are so many other industries that are also growing to consider, and choosing something you are passionate about can make individuals, whether it’s B2B or B2C, seem so much more inviting and interested in it compared to others.

Make sure you do your research in terms of growth within that industry in various locations over the last 5 to 10 years before setting up shop anywhere, as this will give a better insight into potential trends.

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Originally Posted June 7th 2021

Growing up with the internet, as I did, it’s of no surprise to me that traditional methods of marketing are failing to grab the attention of millennials and Generation Z. Many have wised up to the artifice and pretence of the advertisements that would’ve persuaded their parents and grandparents.

Today, brands must double down on their relatability and authenticity to cater to younger consumers. With an estimated buying power of over 600 billion dollars, it’s certainly within any brand’s interests to market themselves towards millennials.

They are a generation with the highest levels of brand loyalty, but it seems increasingly difficult to earn their trust from traditional marketing. Elite Daily’s study shows that ‘only 1% of the 1300 millennials surveyed said that a compelling advertisement would make them trust a brand more,’ suggesting that, ‘millennials believe that advertising is all spin and not authentic.’

Turning to streaming services such as Netflix, Amazon Prime Video and Disney+ for their entertainment, millennials are less likely to watch traditional advertisements, and therefore unlikely to be exposed to a brand or product that wasn’t already on their radar. Even the five-minute ad break between television shows appears to be too long to hold the attention of millennials and Generation Z, with the optimal duration for an advert likely to capture their attention being 15 seconds, perfect for scrolling through Instagram or TikTok, or even at the start of a YouTube video. Not all internet advertisements are engaging for millennials, however, with pop-up ads seemingly the worst. 96% of respondents admitted that they disliked them. Around 50% of millennials preferred YouTube advertisements and email updates, possibly because they were easier to skip and ignore.

One of the advertising strategies that appeals to millennials the most is influencer marketing—appreciated for its honest and transparent approach. To garner a significant following, influencers must develop a relationship with their audience, by creating a relatable and down-to-earth image. If a product apparently works well for the influencer, their followers are likely to believe that it will work in the same capacity for themselves also. Many influencers claim that they will only partner with a company and create sponsored content that aligns with their own personal brand and values, which only furthers their aura of authenticity.

What AI thinks Influencers Look Like

Instagram appears to be the most popular platform for influencer marketing, with more than 1 billion active users and its emphasis on photo and video content, which allows brands to visually promote their products. Similarly, aside from the skippable ads at the start of their videos, many YouTube creators earn money by taking on sponsorships with a variety of brands—either promoting their product within a section of the video or creating dedicated content to endorse it. Companies seem keen to incorporate social media influencers into their marketing strategies, as ‘two-thirds of firms plan to increase the amount spent on influencer marketing within the next year, and 80% forecast to spend at least 10% of their marketing budget on it’ (Haenlein, et al 2020). This clearly has the desired effect on millennials and Generation Z, who are more likely to purchase a product or service if it’s promoted and endorsed by an ‘admired and respected person’.

However, whilst younger people are adept at discerning the artifice of traditional advertisements, influencer marketing can be more deceitful than imagined. In the United States, the Federal Trade Commission (FTC) enforces rules and guidelines to protect consumers, which includes disclosure agreements, i.e. prompting influencers to reveal their relationship with the brand. The FTC guidelines are fairly vague, so even writing ‘#Ad’ suffices as proper disclosure; however, this is often placed discreetly within the post, and therefore missed by their followers. Whilst these influencers can be fined for not properly disclosing sponsorship, because there are so many posts within the Wild West of the internet, murky advertisements can be missed. One study found that 93% of influencer sponsorships are undisclosed, and therefore violate FTC guidelines.

FTC fines are not the only possible consequences of influencer marketing. Their audiences want relatability and authenticity, which can be difficult to maintain after numerous brand deals and sponsorships. Even if the audience accepts that their favourite celebrity is shilling a product to them, there is the expectation that the company they’re partnering with should align with the influencer’s values.

‘Understanding influencer marketing: The role of congruence between influencers, products and consumers’ gives the example of an Instagram influencer who partnered with Volvo to promote a toxic-free car cleaner. Her followers resented this endorsement, as it appeared forced and performative; this eco-friendly, sustainable message was incongruous to her usual jet-setting, travel-related content. Not only did this partnership backfire, wasting money for Volvo, the consequences may have also extended to a loss of followers for the influencer because she’d broken their trust.

Influencer marketing is not as straightforward as it may seem. Something as artificial as product marketing must still be perceived as authentic and genuine. Once an influencer grows and accepts more sponsorships, it’s likely that their followers will realise that they’ve become simply a target demographic. The ‘I’m just like you’ mentality could come crashing down. Whether this happens before the FTC cracks down on undisclosed partnerships remains to be seen.