Record high in UK new business creation as pandemic triggers wave of new e-retailers and delivery businesses

  • 319,000 new businesses created in the last 12 months – 13% up on previous record
  • Number of delivery businesses in the UK jumps 43% in just a year
  • ‘Great resignation’ sees rise in food and drink makers

A record 319,000 new businesses were created in the UK in the last 12 months* as the COVID-19 pandemic triggers a new wave of entrepreneurialism.

The past 12 months saw 13% more new businesses created than in the previous record year of 2015/16 (283,000 new businesses) and 21% more than created last year (263,000) – see graph below.

The accelerated adoption of online retail during the pandemic has seen a huge number of people in the UK start new businesses either selling goods online or delivering them.

In the last year alone, the total number of retail businesses operating in the UK rose 15% from 295,000 to 339,000, while the total number of delivery businesses jumped 43% from 34,000 to 49,000.

Rebecca Copping, Associate Partner, says: “The leap in new businesses created in the UK this year is like nothing we have seen before.”

“Much was made of the rise in entrepreneurialism coming out of the last credit crunch but the pandemic has triggered a far greater increase.”

“Online retail and delivery have been major growth industries for a number of years but the past 12 months have supercharged that.”

Record high in new businesses created in the UK as COVID-19 triggers wave of entrepreneurialism

‘Great resignation’ sees rise in food and drink makers

Other industries that have seen substantial pandemic-driven increases in new business creation over the past year include drinks manufacturing (an increase of 6% in the total population of businesses) and food manufacturing (a 4% increase) – see table below.

Furlough and the so-called ‘great resignation’ of the past year have driven more people to follow their dreams and start small businesses such as artisanal food manufacturing businesses.

Adds Rebecca Copping: “A lot of people dream of quitting their desk jobs and starting a business making small-batch gin or artisan bread, for example. For some, the pandemic has given them the push they needed to turn those dreams into reality.”

“Given the challenges many start-up businesses face, a lot of them may fall by the wayside over the next couple of years, but COVID-19 is likely to end up being a major factor in the creation of the next generation of household name businesses.”

Delivery and retail top the charts of fastest-growing industries by new businesses created

Sector Number of businesses 2019/20 Number of businesses 2020/21 Growth rate
1 Delivery 33,930 48,560 43.1%
2 Retail 294,980 339,390 15.1%
3 Residential care 1,070 1,170 9.3%
4 Haulage 59,310 64,760 9.2%
5 Chemical manufacturing 3,700 3,920 5.9%
6 Clothing manufacturing 4,310 4,560 5.8%
7 Drinks manufacturing 3,210 3,390 5.6%
8 Food manufacturing 10,080 10,520 4.4%
9 Waste management 1,250 1,300 4.0%
10 Wholesale 116,670 120,370 3.2%

* Year end September 30 2021. Source: HMRC

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