This decade has been difficult for small business owners, to say the least. Between the pandemic, the cost-of-living crisis and a great deal of political turbulence, SMEs have had a lot to deal with.
Nevertheless, 2025 is a great time to become a small business owner. Survey findings show that small business owners are expecting increased demand as well as international expansion and new products in the coming year. KPMG discovered that 92 per cent of 1,500 respondents are upbeat, while 89 per cent of 500 Aviva respondents felt the same. SMEs, in particular, are looking to invest in skills and staff development this year.
You don’t have to start with a full-on business either; many take the side hustle route first to test whether their business idea is a goer, developing into a fully-fledged business later on.
Where do I even start?
We bring you seven business ideas to consider in 2025 and why they’re a smart idea. Or if you want to skip to your favourite idea, use the navigation below.
- Local experience provider
- Dog daycare
- Sustainable clothing
- Town-based co-working space
- 3D-printed products
- HR business consultancy
Local experience provider
According to the Centre of Business Economics and Research, businesses in the experience economy contribute an estimated £134 billion to the wider UK economy. This expected to grow by an average of 2.6 per cent between now and 2027. What’s more, people prefer to spend on activities that they can do with their friends and family and 13 per cent of these people said they felt less guilt buying an experience too.
It’s crucial to understand your target market before you do anything concrete. What kind of demographic is your local area made up of, how much disposable income do they have and how much spare time do they have? Do you have any competitors in your area offering similar?
Have the correct insurance that’s specific to your business. If you’re performing high-risk activities such as quad-biking, that’ll be quite different to someone offering a cheese-making course.
We spoke to Beth Kent, lead facilitator and director of communications at Think Forensic, a Huddersfield-based company running crime scene investigation workshops.
Why is starting a local experience provider business a good idea?
For any business, it is the unique nature of the offering that sets them apart from the rest. With local providers, customers are able to access something unique, without having to travel and factor in additional expenses.
We also find that providing something completely different on the doorstep makes locals really proud of where they live. Being the only bespoke crime scene centre in the UK that the general public can access is something that West Yorkshire residents find really valuable and are then more keen to engage with. This also means that there is more buy-in and that locals tend to recommend the business with others.
Why is 2025 an ideal year to start a local experience provider business?
As a company that was founded back in 2007, the landscape has changed considerably, but with finance and budget for customers being more at the forethought of their purchasing decisions than ever, it makes sense to offer a brand-new, local offering that can provide a cheaper alternative and pump money back into the local economy.
We recently moved premises to another local village and again, offering something ‘new’ really does increase buy-in and engagement from the community and beyond.
What growth trends are we seeing in the industry?
Due to customers being more conscious of their budget, people are increasingly placing importance on memories over material goods. Our customers are often booking experience days for a loved one to celebrate a special occasion, so they want something memorable that they can’t get anywhere else.
Top tips for starting a local experience provider business in 2025
Here would be our top three tips:
1. Develop relationships with other local business providers. Whether it be local hotels or eateries that you can point your customers in the direction of, you’re all there to succeed. Help other local businesses out and it will only help spread the word of your own company.
2. Don’t limit your marketing. Think about when you go away on holiday and you bump into someone you’ve never seen before who only lives down the road! Chances are they tell you something about your local area you never knew yourself. The same applies to marketing.
We’ve met people at events in Austria who then became local customers, so never limit how far you spread the word.
3. Reiterate your USP. This one is pretty standard, but the more you share why supporting local is important and that without you there wouldn’t be X in the area, the more people begin to understand your value. Creating local supporters means you have cheerleaders who then spread the message far and wide.
Dog daycare
Owners absolutely love their pets, especially dogs, and they will spend generously on them. UK dog owners spend an average of £1,875 per year on their dog, according to Statista. In London, the average daily cost of full-time dog daycare is £45. That would chock up £10,575 across a year.
It’s a given that you’ve got to love dogs and have some space for them to open a dog daycare. But is that enough?
Again, do your research. How many people in your area have dogs and if so, what breed of dog? Would they get on well with other dogs? It’s also crucial to learn what your local regulations and licensing requirements are for running a dog daycare in your area. This could entail a boarding licence if you offer overnight services.
On that note, define what it is that you’re going to offer. It could be full-day, half-day, overnight, weekends. If you have capacity, offer dog walking and dog grooming on top of your daycare service.
It’s important to establish expectations with potential customers before you take any dogs on so that they’re in-line with things such as your insurance policy.
Pawsome customer and PR professional, Sarah Fardon, and company founder Annabelle, talk to us about Pawsome Dog Day Care.
Why is starting a dog daycare business a good idea?
Following Covid-19, my client has witnessed astronomical growth in dog ownership, driving strong demand for pet care services. Their experience shows that dogs thrive in social environments where they can interact with others, receive attention and burn off energy in a controlled setting. Importantly, doggy daycare provides positive physical and emotional benefits for dogs – a big selling point for pet owners who want the best for their furry friends.
They’ve found pet owners are typically very dedicated to their animals and willing to pay for services that ensure their pets’ happiness and well-being. With hybrid working now standard, professional dog care has become essential for many owners.
Why is 2025 an ideal year for a dog daycare business?
The pet care sector continues to expand as dog ownership grows. Importantly, the demand for dog daycare services is not limited to just one area, with new markets constantly emerging. My client has found that once you’ve established a successful doggy daycare, there are significant opportunities to scale into multiple locations, expand service offerings, or even franchise the concept.
What growth trends are we seeing?
Pawsome has developed multiple revenue streams including grooming, training, boarding overnight and retail. Their growth has been driven by their commitment to quality care, which generates both loyal returning customers and their recommendations to other pet owners. As more people own pets, new markets are constantly emerging, creating fresh opportunities for well-run businesses.
Top tips for starting a dog daycare in 2025
Based on Pawsome’s experience, success depends on:
- Thorough market research
- Choosing the right location with outdoor space
- Focus on safety and comfort
- Offering services that suit clients’ lifestyle/work commitments
- Investing in skilled staff
- Creating a strong online presence
Sustainable clothing
Young people are becoming more conscious of the negative impact of fast fashion and are leaning more towards thrifting to offset the impact they’re having. Secondhand/upcycled and sustainable fashion is therefore becoming more and more sought after.
There has been a particular uptick in Millennials and Gen-Z purchasing clothing second-hand. For example, Love Island switched sponsor allegiance from a fast fashion brand to eBay and have stuck with the pre-loved brand for the past five years. A sizeable 67 per cent of UK Millennials shop second-hand. A ThredUp survey also reveals that two in five items in Gen Z’s wardrobe are second hand. Its latest report reveals that, by 2027, the value of the fashion resale market will reach £2.76 billion. What’s more, according to a partner study between The Ethical Consumer and the Co-op in 2023, preloved purchases have climbed £1.2 billion between 2022 and 2023.
You’ll probably recognise brands such as Depop and Vinted alongside stalwarts like eBay. This one could be a good one to start off with as a side hustle. Know the key terms, especially if you’re going to be using specific materials, such as bamboo, in your business. Decide if you’ll be selling in-store, online or a combination of both, as well as where you’ll get stock and how to price it.
Ayesha Mustafa, who runs a company of the same name, talks to us about sustainable fashion as a business.
Why is starting a second-hand/sustainable clothing business a good idea?
Consumers are increasingly becoming more aware and conscious of their purchasing pattern and want to buy from brands that are transparent and have a story that connects with them.
Why is 2025 an ideal year to start a second-hand/sustainable clothing business?
Awareness, climate change issues, the environmental hazards of fast fashion. People also want clothing that is comfortable and lasts longer and thus are switching to better quality sustainable options.
What growth trends are we seeing in the industry?
Circular fashion businesses, regenerative material, emergence of rental platforms and second hand selling.
Top tips for starting a second-hand/sustainable clothing business in 2025
Try to identity what problem you are solving for a customer and focus your business objectives on that.
Town-based co-working space
We all know about WeWork and all the other big city co-working spaces that shot to popularity during Covid. But another lesser-known trends emerged during that time: ‘work-near-home’.
There are compelling reasons to opt for a co-working space in a town. The rent is cheaper, there’s more of a community feel, and you might even get a subsidy from employers looking to boost remote worker productivity for those who won’t find it as easy to get into the big city office.
Melissa Richards set up co-working space, Buick Mackane, in the small town of Newbury, Berkshire, back in May 2021. This is why she recommends others do the same.
Why is starting a town-based co-working space business a good idea?
It’s a fantastic way of bringing people together within your local community. It fosters not only friendships but also offers business opportunities for collaboration, often in the most unexpected ways.
Why is 2025 an ideal year to start a town-based co-working space business?
The lasting effect of Covid is that remote work continues to be a central part of many people’s lives. This can lead to loneliness and isolation and a need for more collaborative spaces. Certainly, I found that working at home all the time on my own was isolating and this was the main reason I set up Buick.
While big towns and cities offer many opportunities for shared work space, small towns often have little to offer in this area. In Newbury at that time Regus was the only offering! I believe that in 2025, the demand for co-working spaces in smaller towns will only grow. The challenge then becomes how to make people aware of the space.
What growth trends are we seeing in the industry?
I’m seeing a dual trend: some companies are opting for long-term private office spaces after re-evaluating remote work, which has led to increased demand for dedicated offices. However, many businesses still seek flexibility, with teams preferring co-working spaces as a cost-effective alternative to maintaining their own office. This flexible model is particularly relevant in a small town where you need to try to cater for as many demands as possible in order to maximise occupancy.
Top tips for starting a small town-based co-working space business in 2025
- Know your demographic and adapt your space accordingly
- Stand out. Differentiate yourself from local competition
- Build up awareness and interest before you open
3D-printed products
The UK 3D-printed industry was worth $1,553.1 in 2023, according to Grand View Research.
3D printers are becoming more common but still fairly rare. They could offer printed versions of things people need but don’t think to buy, such as food bag clips, tiny parts for fixing miniatures and phone port dust covers. You might even consider customised products, prototyping, prosthetics or collectibles.
Small Business speaks to Mitchell Barnes, CEO of RYSE 3D, about the emergence of 3D-printed product businesses.
Why is starting a 3D-printed product business a good idea?
Companies are continually looking at new processes and materials that can help them make components quicker, greener and more cost-effective.
3D printing can do all these things and more and we’ve seen in recent years a massive change in attitudes towards embracing additive manufacturing.
Firms, like RYSE 3D, are pushing the boundaries of innovation in this area and proving that we can manufacture production ready parts in this format – we’re opening the doors for others to follow.
Entrepreneurs are also more socially minded in this day and age, and 3D printing gives you the opportunity to influence the way many critical things are made, whether that is medical devices and new green energy products or the next generation of cars.
Why is 2025 an ideal year to start a 3D-printed product business?
There is a real appetite for 3D printing both from a ready-made customer base and, importantly, from investors who see it as a market rich in potential.
These two things alone give you a good starting point for launching an additive manufacturing business, but there is a lot of competition, and you will have to come into the arena with an offer that is different to what is out there.
What growth trends are we seeing in the industry?
We predict an increase in the adoption of 3D printing in low volume parts for niche vehicles. For example, we’re now making components that are fitted to 23 of the world’s most ambitious hypercar projects and this number will grow in 2025.
New sectors are looking to additive manufacturing as a possible alternative production process and that is something we all need to explore and exploit by working in tandem with clients to test processes, materials and run times.
Skills have been a big issue for us, but we’re now seeing a new generation of budding engineers who actively want to be involved in 3D printing.
Top tips for starting a 3D-printed product business in 2025.
Develop a plan but be agile as opportunities you hadn’t considered will arise in this rapidly evolving market.
Believe in your ability and that of your team, surrounding yourself with people who are better than you at certain tasks.
Importantly, and I’ve learned this the hard way on occasions, stick to your vision and when those inevitable bumps in the road come, seek counsel from trusted friends, family and colleagues.
Finally, and I make no bones about this one last piece of advice. Failing is not a negative process, it’s an opportunity to learn in terms of technology and personal development.
HR business consultancy
With so many changes predicted after consultation on the Employment Rights Bill, small businesses will want to prepare for the extra costs and paperwork this could incur. If they don’t have in-house HR already, an external HR consultant is an option, or they could save on HR in-house by recruiting a consultant.
On top of that, according to We Go Beyond HR, 85 per cent of workers aren’t engaged in their roles. This could be a prime opportunity for you as an experienced HR professional to influence a struggling business.
In general, being an independent consultant gives you greater freedom and autonomy than working in-house. You also have the opportunity for more diverse roles.
Ruth Cornish (chartered FCIPD), and founder and director of HR consultancy, Amelore, goes into more detail.
Why is starting an HR consultancy for small businesses a good idea?
Firstly, and perhaps most importantly as the business owner, you will have total control – control over the hours you do, control over the clients you work with and of course the types of work you will take on. You can also earn more too which is of course a massive bonus.
I think too many people focus on designing a logo and building a website at business set-up, but it is where your customers come from and what they want that should be a start-up’s key focus. The rest can flow from there. I began my career in sales before I went into HR which really helped me as I had a commercial approach and understand profit and loss. This approach also works for our fast-growing clients who want quick solutions. I am growing a business to sell so creating my own asset is exciting and rewarding.
Why is 2025 the right time to start an HR consultancy?
I would say there is no better time due to the sector growing so rapidly. Increased employment rights coupled with the challenges of competing in a difficult market means that companies need good HR expertise. Many are outsourcing HR to reduce their costs, and this is of course where we come in.
What growth trends are we seeing in the industry?
This sector is poised for significant growth as more businesses than ever need good HR skills yet want to benefit from lower costs and the flexibility of outsourcing. Key areas include strategic workforce planning, talent management, leadership development, digitalisation, employee wellbeing and managing remote and hybrid working.
Top tips for starting an HR consultancy for small businesses in 2025.
- Start-ups will need to know what their niche is. This is key to ensure they stand out from the rest in a competitive and busy market
- Start-ups should research their market to ensure the services they want to offer are what customers want to buy
- Finally, I would encourage all HR start-ups to get professional indemnity insurance and a good accountant on board from the start
How do I go about starting a new business?
There’ll be a lot to think about as your business adventure unfolds in 2025 – licences, insurance, company structure – but for now you can focus on the fun stuff. Head to our start a new business section to look at more business ideas, decide on a business name and learn how to market yourself. Good luck!
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