Key Highlights
In 2025, 5.7 million private sector businesses were operating in the UK.
SMEs (0-249 employees) account for 99.9% of all UK businesses but only generated 51.2% of the total turnover (£2.8 trillion) in 2025.
SMEs account for 60% of total private sector employment and large businesses (250+ employees) employ 40% of the UK’s total private sector workforce.
There were still 5% fewer businesses in 2025 than the 2020 pre-pandemic high of 5.98 million.
The total turnover of private sector businesses in 2025 was £5.5 trillion.
London’s average company turnover per business is almost double the national average at £1.7M.
The average turnover per employee was £196,411 for the UK as a whole.78% of UK SMEs reporting a profit or surplus in 2024
The average age of UK companies is 9 years and only 11.6% have survived more than 20 years.
UK Small Business Demographics
In 2025, 5.7 million private sector businesses were operating in the UK (3.5% more than 2024).
Small businesses (0-49 employees) make up 99.2% of all businesses but only 34% of turnover.
SMEs (0-249 employees) account for 99.9% of all UK businesses but only generated 51.2% of the total turnover (£2.8 trillion) in 2025. The other 48.8% ($2.7 trillion) of total turnover was generated by large businesses (250+ employees).
Overall, SMEs (0–249 employees) provided around 60% of total private sector employment throughout the period, but the trend is flat to slightly declining, driven by the relative gains of large companies.
Number of UK businesses in the private sector and their associated employment, employees and turnover (start of 2025)
| SME Type (employees) | Businesses | Employees (Thousands) | Turnover (£ Billions) |
|---|---|---|---|
| 0 employees | 4,272,535 | 4,664 | 403 |
| Micro (1-9) | 1,150,875 | 4,156 | 701 |
| Small (10-49) | 220,085 | 4,324 | 776 |
| Medium (50-249) | 38,435 | 3,738 | 949 |
| Large (250+) | 8,335 | 11,246 | 2,696 |
| All businesses | 5,690,265 | 28,128 | 5,525 |
Number of UK businesses in the private sector and their associated employment, employees and turnover (start of 2025)
| SME Type (employees) | Businesses | Employees | Turnover |
|---|---|---|---|
| 0 employees | 75.1% | 16.6% | 7.3% |
| Micro (1-9) | 20.2% | 14.8% | 12.7% |
| Small (10-49) | 3.9% | 15.4% | 14.0% |
| Medium (50-249) | 0.7% | 13.3% | 17.2% |
| Large (250+) | 0.1% | 40.0% | 48.8% |
| All businesses | 100% | 100% | 100% |
UK Business Population Growth
At the start of 2025, there were 5.69 million private sector businesses, which is still 5% fewer than the prepandemic 2020 high of 5.98 million.
The number of private sector businesses in the UK rose by 3.5 % between 2024 and the start of 2025.
The number of non-employing businesses increased the most in the year to 2025 (6.1%) but there are still 9% fewer than their 2020 high.
There are still fewer businesses with 0-9 employees than in 2020.
The number of large businesses (250+ employees) and increased the most since 2020 (7.5%).
Average Small Business Turnover By Region
The total turnover of private sector businesses in 2025 was £5.5 trillion.
London’s average company turnover per business is almost double the national average at £1.7M.
The average turnover per employee was £196,411 for the UK as a whole.
London has the highest average turnover per employee (£296K), which is about twice as high as businesses in the South West (£145K).
The largest increase in average turnover in 2025 was in Wales, increasing 16.4% to £623,780, while the largest decrease in turnover for 2025 was in the East Midlands, with a 6.6% decrease from 2024 (£744,195).
The total turnover of private sector businesses in 2025 was £5.5 trillion.
In 2025, the average turnover of UK businesses increased only slightly by 1.3% to £970,897.
Turnover growth was strongest in Wales and the North East in 2025, indicating some catch-up among lower-turnover regions, though high-turnover areas like London also saw moderate gains.
Meanwhile, regions with relatively low average turnover, like Wales, Northern Ireland, and the North East, recorded modest turnover growth between 2-9% from 2024-2025, a slower pace than previous years when growth exceeded 10%.
Average SME Profit By Business Size
Small business profitability is back to pre-pandemic levels, with 78% of UK SMEs reporting a profit or surplus in 2024 compared to just 65% in 2021.
Approximately 14% of SMEs made a loss and 8% broke even.
The median profit reported was just £13K.
Note: Businesses answering ‘don’t know’ or refusing to answer profitability questions were removed from the data.
| Category | Total SMEs | 0 employees | 1-49 employees | 10-49 employees | 50-249 employees |
|---|---|---|---|---|---|
| Valid responses | 14,650 | 3,072 | 6,195 | 3,858 | 1,505 |
| Made a profit | 77.90% | 76.70% | 79.10% | 89.50% | 93.00% |
| Broke even | 8.10% | 8.10% | 8.10% | 3.50% | 2.30% |
| Made a loss | 14.00% | 15.10% | 14.00% | 8.10% | 5.80% |
| Median profit made | £12k | £11k | £24k | £73k | £243k |
| Median loss made | £3k | £2k | £8k | £21k | £70k |
Source: BVA BDRC SME Finance Monitor Q4 2024 Report
Average Small Business Turnover By Industry
Arts, Entertainment, and Recreation saw its turnover increase by 8% in 2024.
Accommodation and food services saw the largest rise in turnover (11%), showing continued strength post-pandemic.
Human Health (11.9%), Accommodation and Food Services (9.9%), and Real Estate (8.3%) all saw significant growth in the number of businesses in 2025.
Business Sentiment
Accommodation and food services businesses are the most pessimistic about future turnover. 32% think turnover will fall.
16% of businesses believe turnover will increase, a slight drop from 18% in February 2024. This figure is, however, skewed downwards by the number of small businesses, which is the most pessimistic group.
29% of businesses with 10+ employees expect turnover to rise.
In October 2025, the most reported challenge facing turnover growth was economic growth at 28%.
For businesses with 10 or more employees, the most commonly reported challenge is still the cost of labour (33%), although this figure has decreased by 8% since peaking in early April.
New Openings & Failure Rate Of Small Businesses
Business growth accelerated in 2025, with openings consistently outdoing closures across most quarters, which contrasted with 2022/2023 when closures dominated.
After a dip in late 2024, new business formations rose sharply in early 2025, signalling renewed confidence as economic conditions improved.
The net balance remained positive throughout 2025, suggesting a sustained recovery in entrepreneurship and overall business activity.
Business Survival Rates
In 2025, the average age of UK companies is 9 years.
Just 11.6% of UK companies have survived more than 20 years.
70% of UK companies are less than 10 years old.
38% of companies in liquidation are less than 4 years old.
The average age of UK companies fell from 10.7 to 8.6 years between 2000 and 2022.
