Market research for doing business in the United Kingdom

If you want do business in the United Kingdom you need to know the regulations, market structure, competition and what investments you should make.

In this article I will provide basic information about the country and highlight how you can collect and evaluate all the information that you need.

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Doing business in the United Kingdom

The United Kingdom (UK) remains one of the most attractive markets in Europe due to its strong economy, established infrastructure, and business-friendly environment. Despite challenges like Brexit, the UK offers significant opportunities for international businesses.

Key Market Numbers

The UK’s economy and population provide a strong foundation for various industries. Here are the key statistics:

  • Population: Approximately 67 million (2023).
  • GDP per capita: Around $46,000 USD (2023), reflecting high consumer purchasing power.
  • Urbanization: About 84% of the population lives in urban areas, with London, Manchester, and Birmingham being key economic hubs.
  • Economic Structure: Services account for around 79% of GDP, with strong sectors like finance, technology, and healthcare.
  • Ageing Population: Yes, around 19% of the population is aged 65 or older, increasing demand for healthcare, financial planning, and senior-focused products.

Language and Documentation

Operating in the UK is relatively straightforward for English-speaking businesses, but localization can still enhance success.

  • Official Language: English is the official language and universally used in business, education, and government.
  • Language Considerations: Standard British English is preferred for marketing and documentation. Businesses should avoid American English spellings or phrasing unless targeting specific demographics.
  • Packaging and Documentation: Compliance with UK labeling laws is critical, particularly in industries like food, pharmaceuticals, and consumer goods. Packaging must include details like ingredients, measurements in metric units, and safety warnings.

Consumer and B2B Buying Behavior

The UK’s consumer and business markets are shaped by trust, quality expectations, and a growing focus on sustainability.

  • Consumer Behavior: UK consumers value quality, brand reputation, and transparency. Sustainability and eco-friendly products are increasingly important. Online shopping accounts for around 27% of retail sales (2023), with platforms like Amazon UK, ASOS, and Tesco dominating the market.
  • B2B Buying Behavior: UK businesses prioritize efficiency, professionalism, and cost-effectiveness. Relationships and networking are important, particularly in industries like finance and manufacturing.
  • Online Presence: A strong digital presence, including localized websites and social media activity, is crucial. Platforms like LinkedIn are widely used for B2B networking, while Instagram and Facebook are popular for B2C engagement.

Market Challenges and Opportunities

The UK presents opportunities but also challenges due to its regulatory landscape and post-Brexit changes.

  • Products/Services that May Struggle: Items with non-standard specifications or those that fail to meet UK regulations may face difficulties. Price-sensitive products can struggle to compete with established brands in the market.
  • Test Market Potential: The UK is an excellent test market for English-speaking regions due to its cultural influence and diverse consumer base. Success here can often be replicated in other Western markets.
  • Regulatory Environment: Post-Brexit, businesses must comply with UK-specific regulations, which may differ from EU standards. This includes customs requirements, labeling rules, and product certifications. Engaging local legal and compliance experts is highly recommended.

VAlidate the HS-codes you use for shipping

Almost every country or trade block in the world has its own detailing on the international HS-code list. With our report you strongly reduce the risk on misclassifications, delays and higher custom duties than expected. 

Tell us what you want to ship and where to and we ask you all relevant questions to get to the most likely code.

Topics to check before doing business

Where it comes to assessing the viability of a product or service in a new market, I always look at the following aspects:

1. Regulatory compliance

Can the product be imported and sold in the country, what are import duties and are there any restrictions on service delivery? What are the investments to comply to all regulations? 

2. Market needs

Is there a genuine demand for this product or service in the market and which aspects are decisive for the customers? What are common channels for marketing and sales?

3. Competition

How fierce is the competition and is there a clear market leader? Is there room for a new entrant and what happened to other companies trying to penetrate the market?

4. Investments

What steps are needed to enter the market and what are the related costs. How quickly can you expect revenue and what is a reasonable pay-back time?

You can of course find a lot of information yourself, especially about regulations. But in order to have a good view on the competition, you will have to search locally, visit retail outlets or talk with buyers. Only a local expert can do this.

Before you focus only on the United Kingdom

Please note that there are many countries in the world and the biggest ones or the ones nearby are not automatically the best choice. It all depends of the market growth, the competition and the barriers for entry. 

Therefore I would advise you to make a short-list of at least three, but preferably five potential new markets and compare them against the same criteria.

Frequently asked questions

In the United Kingdom all aspects count that you normally have in other countries. What are the relevant regulations? How big is the market? What competition will you face? And how much will it cost to enter the market? These questions will help you decide whether to enter the market or not.