Where is the best city in the UK to do business?\” />
Despite the ongoing economic challenges faced by the UK government, business activity remains strong in parts of the UK. By parts of the UK, there are some areas that are more ‘favourable’ than others.
Which are the most favourable UK cities to start a new business in?
To identify which UK cities and districts offer the best conditions for starting a business, a review has been undertaken by the firm BestBrokers. The company analysed the latest data from the UK’s Office for National Statistics. Then, a weighted index was developed, giving equal importance to six key factors: five-year survival rate, active companies per 1,000 people, share of high-growth firms, export value per company, gigabit internet coverage, and labour productivity. The ranking covers 63 of the UK’s most populous cities and districts.
These data reveal a surprising leader in UK business density: the Scottish town of Falkirk, boasting 107.33 companies per 1,000 residents. Wakefield, the historic cathedral city in West Yorkshire, ranks second with 99.21 businesses per 1,000 people. These smaller cities notably outperform major urban centres such as London and Manchester, which register 66.81 and 47.26 companies per 1,000 residents, respectively, highlighting a shift in entrepreneurial activity beyond the usual metropolitan hubs.
UK cities and regions with the highest number of companies per 100 residents:
1. Falkirk – 107.33
2. Wakefield – 99.21
3. Bedford – 73.22
4. Solihull – 71.46
5. London – 66.81
6. Aberdeen City and Aberdeenshire – 61.37
7. Fermanagh and Omagh – 60.50
8. Leeds – 60.39
9. Brighton and Hove – 57.31
10. Manchester – 47.26
As indicated above, Falkirk boasts the highest business density in the UK, with 107.3 companies per 1,000 residents. It also ranks in the top ten for overall business conditions, just a few points behind cities like Belfast, Derby, and London in our ranking. While just over a third of new businesses survive past five years, this modest survival rate still outshines that of larger cities such as Manchester and Birmingham.
Wakefield claims second place, with nearly 100 businesses per 1,000 residents and a notably higher five-year survival rate of 41.4%. The city also ranks ninth among the UK’s best places to launch a new business, scoring 55.1 points, nearly on par with Bristol’s 55.5.
Bedford and Solihull secure third and fourth places, each with over 70 businesses per 1,000 residents. Solihull ranks as the second-best UK city to launch a business, just behind Edinburgh, while Bedford falls to 33rd, primarily due to lower labour productivity despite boasting a higher business survival rate.
London, home to nearly 9 million people, has a company density of 66.81 businesses per 1,000 residents, ranking fifth overall. Despite the vast number of enterprises, only 39% survive beyond five years, one of several factors that prevent the capital from being named the most favourable location for launching a business.
At the other end of the scale, in Birmingham, only a quarter of new companies survive more than five years. The 2023 city council bankruptcy triggered sharp budget cuts, rattling investor confidence. Now, just 0.36% of all businesses in the city are classified as high-growth.
