According to new research from Uswitch Business Energy, the comparison and switching service, rising energy costs threaten to hold back UK entrepreneurial ambitions, with more than six in ten adults (63%) saying higher energy prices would make them less likely to start a business.
The study found that more than one in four UK adults (27%) say they are likely to start a business.[1] However, more than half (55%) say they are unlikely to do so, with energy costs a particular concern.
Top five sectors Brits would most likely start a business in:
- Healthcare, Wellness and Life Sciences
- Education and Training
- Retail and E-commerce
- Hospitality, Tourism and Leisure
- Construction and Real Estate
Beyond the top five sectors, Technology and Software, Financial Services and FinTech, and Manufacturing and Engineering also rank among the most popular industries Brits would consider if starting a business.
Although entrepreneurial ambition is widespread, 16% of adults say they have no preferred sector. Funding remains the leading barrier to starting a business, cited by almost a third (33%) of respondents. Lack of experience (24%) and fear of failure (22%) also rank highly, while rising business costs (19%) and economic uncertainty (19%) continue to weigh on entrepreneurial ambitions.
The research also reveals clear generational differences in perceived entrepreneurial strengths. Gen Z is viewed as the most digitally capable generation, with nearly half (45%) associating them with the use of digital tools and technology. Gen Z is also seen as the most sustainability-focused generation (26%).[1]
Millennials are viewed as the most willing to take financial risks (26%) and the most flexible in their working style (30%), while Gen X is seen as strongest for business experience (34%), confidence managing business finances (29%) and financial stability or resources (27%).
Despite strong entrepreneurial ambitions, confidence in managing business costs remains divided. Just over a third (34%) say they would feel confident managing the day-to-day running costs of a business, while a similar proportion (32%) lack confidence and a further third (33%) remain undecided.
Against a backdrop of rising business costs, having a clear understanding of likely energy usage and expenditure could help aspiring entrepreneurs feel more confident about taking the leap into business ownership.
Ben Gallizzi, energy expert at Uswitch, comments: “While more than one in four adults are considering starting a business, many remain unsure about managing the costs involved.
“Funding remains the biggest hurdle, but ongoing expenses matter too. Nearly two-thirds say rising energy prices would make them less likely to start a business, showing how important cost certainty can be when taking that first step.
“Understanding energy usage, comparing tariffs and building costs into a business plan early can help founders feel more confident about turning an idea into reality.”
Ben’s top tips for keeping business energy costs under control
- Plan your energy needs from day one: Think about how much energy your business is likely to use. Factors such as opening hours, equipment, heating, lighting, hot water and refrigeration can all have a significant impact on your bills.
- Factor energy into your business plan: Energy should be considered alongside rent, staffing, stock and insurance. Building it into your planning from the beginning can reduce the risk of unexpected costs later down the line.
- Prioritise efficiency from the start: Choosing energy-efficient equipment, LED lighting and smart controls can help reduce consumption and keep running costs lower as your business grows.
- Review costs regularly: Energy needs can change over time. Regularly reviewing your usage, tariffs and contracts can help ensure you’re not paying more than necessary and that your business remains on the most suitable deal.
For business owners or anyone looking to start a business, understanding and managing energy costs is an important step. To keep costs low, make sure you’re on the right business energy tariff at Uswitch Business Energy.
