myPOS blog Tips

Which Is The Most Profitable Businesses in the UK for 2024

Tips / 30.10.2024

If you’re planning to start a business in the UK, it’s key to evaluate the opportunities you can take advantage of and the industries you can penetrate.

For aspiring entrepreneurs, one of the most important first steps is selecting the right niche to position their business in. This choice will ultimately shape the way you secure funding, the way you reach your target market, your profitability compared to other businesses, and more.

In the following sections, we share some of the most profitable businesses in the UK in 2024. The insights we offer will help you start a new business venture and enjoy some of the highest profit margins.

TABLE OF CONTENTS

eCommerce

In 2024, the UK’s retail eCommerce revenue is expected to reach $160 billion [1]. With a customer base of more than 65 million, this sector is characterised by a high demand and thriving online sales.

In fact, more than 20% of retail purchases [2] are forecasted to take place online in 2024.

These findings naturally position eCommerce at the top of the list of most profitable online businesses in the country. Starting an online store has never been more lucrative, with more than 580,000 eCommerce websites recorded [3].

However, the growing popularity of online shopping and the saturated market means aggressive competition for new entrants.

To stand out from the crowd, you’ll need a solid business plan and access to valuable tools and solutions that perfectly meet your business needs. For example, you’ll need to conduct market research to determine the type of products that it’s most profitable to sell. Will you be selling your own products or will you explore dropshipping as an alternative?

You’ll also need to identify your target audience and prepare an adequate marketing plan to reach the perfect customers online.

Don’t forget that starting your own business in the eCommerce space also means creating an appealing, optimised, and convenient website which consumers can shop from. You’ll, therefore, need to select the right eCommerce platform and ensure that you have a skilled team who can work with it quickly and easily.

Management consulting

According to research, the UK’s consulting market generates an annual revenue of $27,37 billion [4]. At the same time, studies into the management consulting industry specifically reveal that the sector achieved revenue of $103.8 billion in 2023 [5].

These discoveries only prove how profitable it can be to offer consulting services in the UK.

The good news is that you can choose from a range of different niches to concentrate your business around. For example, some of the most popular options include HR, marketing, planning, and business processes. All of these areas require extensive expertise and management consulting is high in demand.

Not to mention that there are a lot of laws and regulations related to financial services and banking, calling for management consulting.

When launching a business in this sector, make sure that you’ve carefully researched the market and are aware of the specific needs in this industry. It’s a must to stay up to date with recent changes in policies and regulations, ensuring that you can provide valuable guidance to your clients.

Renewable energy

When it comes to the most profitable business in the UK, it’s important to also mention the renewable energy sector.

The UK’s low-carbon and renewable energy industry generated a $55.29 billion turnover [6] in 2020, and this number has grown dramatically since then.

Renewable energy ranks among the most profitable business ventures but isn’t linked to a single venture. The sector can be split into solar power companies, onshore wind or offshore wind businesses, bioenergy, hydro, and more.

This area is gaining more and more popularity, especially given that the UK government is strongly committed to reducing carbon emissions.

The beauty of starting a renewable energy business is that it can not only be extremely profitable but can dramatically contribute to creating a more sustainable future for generations to come.

However, keep in mind that there is strict regulatory compliance that is inevitably linked to growing a business in this space. To see your venture excel and evolve, it’s key that you abide by the latest regulations regarding sustainability and renewable energy.

Property management

In 2024, the property management services market in the UK is valued at $44.38 billion [7]. As of today, there are a total of 24,184 property management businesses in the UK.

This industry is appealing for several reasons.

First, it doesn’t require a significant initial investment. As opposed to spending a fortune on real estate, property management companies can simply partner with owners to manage their assets in the most effective way.

Second, this business can quickly scale as the opportunities for growth are unlimited. By forming a team of professionals, you can handle thousands of properties in your area and other locations.

Digital marketing

In 2024, the digital ad spend in the UK is valued at $39.24 billion [8]. Between 2022 and 2027, the digital marketing industry is forecasted to grow at an annual rate of 6.3% [9].

Based on research, the yearly salary for a digital marketing agency owner in the UK is at an average of $30,000 to $70,000 [10].

Out of all available digital marketing channels, social media dominates, with nearly 90% of businesses using it to reach their target audience [11]. Other channels include email marketing (86% of businesses invest), content marketing (78% of businesses invest), SEO (77% of businesses invest), paid search advertising (65% of businesses invest), and video marketing (65% of businesses invest).

This growing demand means that experts in these digital platforms and marketing channels can make a fortune by offering services that help brands grow online. The best part is that you only need to have the necessary skills in a specific digital marketing area and internet access. Working with clients isn’t limited to location or physical presence.

Luckily, today there are plenty of platforms to explore to find new clients that can benefit from your digital marketing services. Some of the most popular ones are Upwork, Fiver, and LinkedIn.

Software development

As the technology sector evolves and continues creating room for innovative solutions, the software development space is skyrocketing in popularity and profitability.

The software market in the UK is projected to reach a revenue of $35.78 billion in 2024 [12].

Businesses that position themselves in this market produce and maintain software solutions that benefit a vast range of industries. These companies usually employ experts with programming skills and a proven track record in programming languages like C++, Java, Python, and more.

Today, the biggest advantage in this space is held by companies that can offer personalisation, speed, and reliability. It’s also essential to be up to date with market changes and new opportunities, like Artificial Intelligence.

Although the creation of software applications is at the core of a software development firm, you can also offer services like software testing, maintenance, and support.

Food delivery business

When discussing the most profitable business ideas it’s essential to mention food delivery businesses.

The UK’s food delivery market value is estimated at $15.27 billion [13]. Projections are that this market will grow by 8.71%, ultimately reaching $69.83 billion in 2028 [14].

Overall, 60% of UK adults [15] use food delivery services in one way or another. This is only natural, considering the fast-paced environment that we live in today.

To grow a successful food delivery business, you’ll need to strategically choose your niche. For example, you can specialise in cultural cuisines, dietary dishes, or meal plans. Most importantly, create a process that guarantees smooth payments, quick deliveries, fresh food, and diversity for your customers.

Online courses

Starting an online course and tutoring business is also among the small business ideas that are expected to generate substantial rewards.

Revenue in online education is expected to reach $10.6 billion in 2024 [16]. Today, more than 11.7 million users [17] actively rely on online courses as a means of learning.

The internet has completely transformed the way we think about education, especially after the COVID-19 pandemic. More and more people prefer to learn in a digitally connected environment, where distractions are brought down to a minimum and users can manage their own time.

For those looking to start a business in this field, this presents exciting opportunities. When creating your online course business, you can focus on live learning sessions with one individual or as part of a group. Alternatively, to save time and multiply your earnings, you can record courses on a given topic and sell them as a pre-made package to users.

This way, you’ll only have to invest your time and energy once into spreading your knowledge and expertise. With good marketing, you can continue earning from your courses in the long term without any additional work.

However, make sure that you offer ongoing support to your students in the form of discussion groups, feedback sessions, and online workshops.

Mobile app development

Today, there’s pretty much a mobile app for everything that you could possibly imagine. However, this doesn’t mean that this space is already oversaturated. There’s still room for new market entrants due to the high demand from users.

The UK’s mobile app development market is expected to reach $9.53 billion in 2024 [18].

To tap in on this potential, you’ll need to possess programming skills, experience, and market insights on what users are interested in and what problems you can solve with your application.

There are multiple niches to explore, from gaming to education or hobbies.

Banking and financial services

Another area to explore for starting a profitable business in the UK is banking and financial services.

From capital raising to mergers and acquisitions, banking enables and supports a vast range of financial transactions in a safe and reliable way.

One of the most profitable industries within this broad sector is peer-to-peer lending. This service enables individuals to lend and borrow money without having to rely on a financial institution. Instead, the P2P lending platform plays the role of the intermediary, providing the connection between the lenders and the borrowers.

In the UK, the market size of peer-to-peer lending in 2024 is $382 million [19]. Expectations are that it will continue growing at an annual rate of 7.1% [20].

Creating a business that provides solutions like peer-to-peer lending can turn out to be more rewarding than you might expect. However, just like in any other financial market, there are strict regulations that vary from area to area. Make sure that you’re aware of all policies and laws before starting your venture.

Event planning

Believe it or not, one of the most profitable small businesses and perhaps one of the easiest businesses you can start is one in event planning.

In the UK, the market size of the party and event planning sector is $2.68 billion [21].

Research reveals that event organisers in the UK make between $22,800 and $107,350 a year [22].

If you possess organisational skills and you’re outgoing, this space might be just the right one for you. Some of the niches you could explore include wedding planning, anniversary parties, birthday parties, baby showers, graduations, and more.

At the same time, there are more business-oriented options to consider, like corporate gatherings and team buildings.

Cleaning business

Although not usually considered one of the most lucrative business ideas, another one of the most profitable businesses in the UK is the cleaning business.

In 2024, the household cleaners market is expected to reach a revenue of $1.54 billion [23]. There are now more than 66,420 cleaning businesses in the country, employing more than 450,000 people. With a vast marketing demand, this space can be extremely profitable, even for new businesses.

After all, residential and commercial clients require regular cleaning services for their properties. Naturally, most cleaning businesses sign long-term contracts with clients. This means that once you successfully market your brand and land your first deals, you can enjoy peace of mind knowing that you have recurring revenue.

However, to achieve this, you’ll need to offer an impeccable service. Most importantly, ensure that your staff is fully qualified and certified. This will help you build trust with your clients and will prevent any uncertainties regarding your professionalism.

As a cleaning business, you can specialise in residential or corporate cleaning. In addition, you can split down your capabilities and services into different niches, such as pool cleaning, restaurant cleaning, carpet cleaning, upholstery cleaning, and more.

Fitness coaching

In recent years, obesity and stress have been on the rise, having a detrimental effect on our bodies and minds. In addition, a large percentage of people work in a static environment, meaning that active movement is out of the question through the working part of the day.

These trends have made fitness coaching a high-demand sector.

The health and wellness coaching market is expected to reach a revenue of $514,55 million in 2024 in the UK [24].

If fitness coaching is the path for you, you can explore different fitness centres to work from or instead – rely on the convenience of an online environment. The COVID-19 pandemic demonstrated that online fitness coaching can be as equally influential and successful as working out with a trainer in a physical environment.

Don’t forget that you’ll need to acquire all of the necessary certifications to be able to coach individuals.

Frequently Asked Questions

What are some of the factors that make a business profitable in the UK?

The most profitable businesses typically have a few things in common. These include strong demand for their products or services, efficient operations to control costs, high margins, and effective use of technology.

Is technology important for improving business profitability in the UK?

Yes, technology can significantly improve profitability by automating processes, reducing labour costs, and improving customer experience. Ecommerce, cloud computing, and digital marketing are key tools that businesses should adopt and use strategically.

How important is market research for maintaining a profitable business in the UK?

Market research is one of the most important factors to understand customer needs, competitor strategies, and market trends. This insight allows businesses to adapt their offerings, find untapped opportunities, and make data-driven decisions, ultimately increasing profitability.