At the start of 2021, there were an estimated 5.5 million small businesses in the UK, with this number comprising 99.9% of the total commercial population.
SMEs therefore exist as a key economic engine, accounting for three-fifths of total employment and approximately half of all turnover in the UK private sector.
Because of this, the UK serves as an attractive market for aspiring entrepreneurs, but launching a venture on these shores can be particularly challenging if you’re from overseas. However, we’ve provided some tips to help you on your way:
How Many Startups Have Launched in the UK Through 2021?
We’ve certainly seen some increased demand to create startups in the formative part of 2021, with the figures showcasing that as many as 40,500 businesses were registered in the UK between January and June of this year.
The research, which was carried out by the small business lender Iwoca, found that this number was up 32% in relation to the same period in 2019, while this signals a pronounced rise in entrepreneurship in the post-coronavirus economy.
Not only does this reaffirm the old adage that crisis equates to opportunity in the digital age, but it also helps to incentivise aspiring entrepreneurs and identify a vibrant marketplace for them to target.
What are the Main Steps Towards Launching an Overseas Venture in London?
The question that remains, of course, is what challenges will overseas entrepreneurs face when setting themselves up in London? Here are some examples to keep in mind?
#1. Identify Your Chosen Business Structure
Let’s start with the basics; as before you even attempt to launch your business venture, you’ll have to identify its overarching structure.
Make no mistake; there are many different types of small business structure in the current economy, depending on the size and scale of your venture and how you intend to operate over time.
For example, businesses that can start small should probably establish themselves as sole traders, in a bid to create a simplified structure and minimise their tax burden for each financial year.
Conversely, partnerships and limited companies offer value for larger and more ambitious firms, with the latter established as a separate legal entity that provides protection for entrepreneurs and their investors in the event of failure.
#2. The Cost of Starting a Business in London
Another universal challenge facing both overseas and domestic entrepreneurs is the cost of launching a new business, particularly in the capital city.
Remember, the cost of living and doing anything in London is considerably higher than the rest of the UK, and this rule also applies to launching a business and funding initial operational costs.
Then there are the core costs of starting your business, from rent and securing a lease on commercial property to recruitment and procuring any materials required to manufacture products.
These costs need to be factored in alongside others such as insurance, while they should also be measured against projected turnover and profitability.
#3. Changing Immigration Rules
Whether you’re relocating to London from the EU or elsewhere in the world, you’re likely to face similarly stringent immigration rules in the wake of Brexit.
From securing the right to work in the UK to ensuring that you have the necessary visa and documentation, it’s crucial that you understand the legal requirements and meet these as quickly and efficiently as possible.
To achieve this, we’d recommend speaking directly to immigration law experts, so that you can move decisively and avoid potential delays or costs further down the line.