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The Top Cities For Launching A Business In 2025

George Dunn
Dec 11, 2024
6 min read

Updated: Dec 12, 2024

In a difficult time for the economy, starting a new business can be extremely daunting. With inflation recovering from recent highs, the cost of goods, energy and materials continuing to rise, and commercial property prices at all-time highs, prospective business owners have to think carefully about when and where to plant their flag.

To provide insights into where new ventures might thrive, Approved Business Finance has revisited its business-focused analysis of the UK’s 60 largest cities. By examining a multitude of data points, including the average price of commercial properties via Rightmove, cost per square foot, GDP, education levels, high-speed internet coverage and average salary, we’ve identified the cities offering the most potential—and those presenting the greatest challenges - for new businesses in 2025.

Exploring a new city to launch a business can be costly with rising rents and stock expenses, but securing a commercial mortgage could offer the financial flexibility needed to establish your venture.

The 20 cities offering the most potential for new businesses

Rank	City	Avg cost per sq ft of commercial space	Share of high-speed internet connections	No. of Business closures per 10,000 population	Total index score
1	Oxford	£36	89.7	34.3	68.97
2	Bristol	£57	89.1	47	65.63
3	Edinburgh	£48	89.7	42.7	65.56
4	Nottingham	£18	90.7	41.2	65.31
5	Cardiff	£87	92.6	44.2	63.53
6	Aberdeen	£11	83.3	53	63.47
7	Norwich	£21	86.8	39.3	63.31
8	Glasgow	£32	87.8	39.5	63.26
9	Leeds	£39	89	54.3	62.55
10	Manchester	£58	88.7	55.1	62.40
11	Coventry	£19	89.9	49.2	62.00
12	Slough	£32	87.2	67.2	61.99
13	Liverpool	£18	89.3	47.1	61.88
14	Crawley	£38	92.2	41	61.52
15	Derby	£14	89.7	42.1	61.52
16	Reading	£79	88.4	61.3	60.52
17	Sheffield	£8	79.6	36.1	60.43
18	Blackpool	£42	87.2	42.5	59.79
19	Chatham	£14	89.8	46.2	59.67
20	Cambridge	£328	91.1	37.8	58.94

Where is the best city to start a business?

According to the research, Oxford is the best place in the UK to start a new business. This city famed for its cobblestone streets and playing host to one of the world’s top universities has commercial space available to buy for an average of £36 per square foot, making it some of the most affordable commercial space available per square foot.

The city also benefits from highly educated staff, some of whom attend Oxford university and settle in the area after graduating. Oxford also has relatively few business closures, signifying a strong local economy for businesses to trade in.

Rival university town Cambridge ranks 20th in the overall index, with relatively few commercial spaces available to buy at any one time, and an average cost of £328 per square foot, making it amongst some of the most expensive commercial spaces to purchase.

Second in the overall rankings is Bristol, with the average square foot cost of commercial spaces cost standing at £57. Almost 90% of businesses in Bristol are currently supplied with high-speed internet, beating out most other cities across the country.

Edinburgh is the third-best city for new businesses, with an average square foot cost of just £48. Per capita, Edinburgh also has the highest number of higher-educated residents in the UK, with 73% of people taking on A-levels or higher.

The 10 cities presenting the most challenges for new businesses

Rank	City	Avg cost per sq ft of commercial space	Share of high speed internet connections	No. of Business closures per 10,000 population	Total index score
51	Mansfield	£15	38.8	90.3	47.49
52	Hull	£35	38.1	83.7	47.37
53	Northampton	£71	88.3	88.4	47.08
54	Sunderland	£23	32.4	86.5	46.51
55	Plymouth	£44	32.8	87.5	46.34
56	York	£142	36.4	81.9	45.39
57	Basildon	£106	55.6	88.3	44.96
58	Bournemouth	£353	48.1	87.1	41.47
59	Belfast	£228	29	92.1	40.45
60	Southend	£115	48.1	85.6	38.12

Southend is currently the most challenging place in the UK to launch a new business. While the city doesn’t have the most expensive commercial space in the UK, at £115 per square foot, the city has poor high-speed internet coverage with just under half of businesses able to get a connection of 30mbps or more.

Southend also has a low percentage of residents who have attended higher education (31%) and also has some of the lowest average salaries in the UK, with an average weekly income of £539.50

Belfast in Northern Ireland doesn’t fare much better, with just 29% of businesses able to access high-speed broadband, and a relatively high cost per square foot of £228. Belfast does, however, have the lowest number of business closures relative to its population, so businesses here can be assured of some longevity.

The south coast city of Bournemouth has some of the most expensive commercial square footage in the UK when it comes to commercial property, with buyers expected to buy a premium £353 per square foot. This is compounded by relatively few properties existing on the market, meaning buyers aren’t exactly spoilt for choice when it comes to where to start a business venture here.

Where in the UK has the most affordable commercial space?

Rank	City	Average cost of commercial space
1	Hull	£223,205
2	Chatham	£246,583
3	Blackpool	£249,944
4	Swindon	£267,222
5	Blackburn	£269,891
6	Newport	£308,155
7	Stoke-on-Trent	£336,004
8	Huddersfield	£337,407
9	Sunderland	£347,534
10	Luton	£358,333
11	Doncaster	£402,807
12	Swansea	£404,636
13	Telford	£405,644
14	Bradford	£408,418
15	Slough	£420,714
16	Barnsley	£450,260
17	Peterborough	£452,757
18	Norwich	£480,776
19	Southampton	£487,129
20	Leeds	£493,222

Kingston upon Hull has the most affordable commercial space currently available to buy in the UK. With the average space costing around £223,000, prospective buyers here can get some serious value for money. The city has a rich history with technological innovation, great transport links across the north of England and a thriving community of entrepreneurs, so there’s plenty of opportunity for businesses to grow and scale quickly.

Chatham has the second cheapest commercial property available on the market, with an average price of £246,000. With reasonable transport links into central London, it could be worth considering for business owners looking to make inroads into London business.

Similarly, Swindon has great links into the capital, and with the average commercial space here costing £267,000, it could well be worth considering as a place to start.

How can prospective business owners get started?

Navigating the financial challenges of starting or expanding a business can be challenging, but there is support available when it comes to purchasing commercial property or financing necessary equipment. Commercial mortgages help businesses secure the right property with manageable repayment options. To help spread the cost of essential equipment, stock or machinery, asset finance solutions can help ensure cash flow remains stable during those critical early years of trading.

Commenting on the research, commercial director of Approved Finance Group, Mark Kozo, said:

“Starting a business in 2025 will be incredibly daunting, with inflation still a major concern for business owners and commercial property prices at historic highs. “The cities we’ve identified, such as Oxford and Bristol, offer great potential for growth, but business owners must always consider their specific needs and resources before making a decision.

“Options like commercial mortgages can help entrepreneurs invest in the perfect location, while business finance offers breathing room designed to provide businesses with the funding they need to maintain daily operations and fuel growth.