As the economy battles a pandemic induced recession, the small business insurer Simply Business analysed trades from across their customer base – looking at the year-on-year rise in requests for small business insurance – to uncover the fastest growing sectors and regions among SMEs.
The data reveals that requests from home baking businesses rose the fastest, with a 157% year-on-year increase from 2019 to 2020. This increase comes as lockdowns presented people across Britain with the opportunity to turn their passion for baking into a ‘self-raising’, successful small business.
Courier services also saw an 80% increase, driven by mass closures of bricks and mortar premises across the economy and a greater need to transport parcels, at a time where the UK postal service was under almost continuous pressure.
Property maintenance was the third fastest-growing sector, with a 30% increase in new business policies throughout 2020, perhaps reflecting increased demand for home improvement services amongst those working from home in spare rooms or at kitchen tables.
Other trades which also saw increases include; roofers (29%), mobile hairdressers (25%), Gardner’s (25%), electricians (24%), cake makers (24%), online retailers (18%) and builders (11%).
Top ten fastest-growing small business sectors:
|Industry:||% Increase (year on year)|
|Landscape gardeners/garden maintenance||25%|
|Cake maker and decorator||24%|
Simply Business also reviewed the regional hotspots for trade SMEs in 2020, with Wales, North West England and Scotland taking the top three spots. Of the top 10 trades that grew fastest in 2020, Wales saw a 31% increase in new small businesses, followed by the North West (29% increase) and Scotland (28% increase).
With the UK steadily in another national lockdown, which is set to continue until the spring, it is expected these trends will continue throughout 2021, driven by a greater need for home and outdoor businesses.
Top regions for SME growth in 2020, of the 10 fastest growing small business sectors:
|Region (of top ten trades)||% Increase|
|North West England||29%|
|North East England||24%|
|South West England||24%|
|South East England||20%|
|South Central England||20%|
Alan Thomas, UK CEO at Simply Business, commented: “Small businesses and the self-employed have been hit harder than most by the effects of this pandemic.
“So, it’s encouraging to see green shoots of growth emerge, particularly those seizing opportunities to make viable small businesses in the home baking, courier and delivery and domestic services industries.
“SMEs play a pivotal role in the UK economy by generating £2 trillion annually and accounting for 99% of all British businesses. Put simply, for the UK economy to recover, we need UK small businesses to recover and drive the next phase of our growth.”