LONDON AND EDINBURGH EMERGE AS TOP DESTINATIONS FOR UK BUSINESS EXPANSION IN 2026
As British companies map out their growth strategies for 2026, a crucial question looms: where should expansion take place to maximise the chances of long-term success?
New research from small business credit card provider Capital on Tap suggests that geography could be decisive. Its latest UK Business Expansion Report analyses the country’s 30 most populous cities to identify where economic conditions are most supportive of sustainable business growth — and where firms may struggle to scale.
The ranking assesses a range of indicators, including five-year business survival rates, GDP per head, employment levels, start-up density and Gross Disposable Household Income (GDHI). Together, these measures offer a picture of local resilience, consumer spending power and labour market strength — all critical factors for companies considering their next phase of expansion.
London tops the index, buoyed by the highest disposable income in the UK at £35,361 per person and the strongest concentration of start-up activity, with more than 82 new businesses per 10,000 residents. While the capital’s five-year survival rate of 38.2 per cent sits below that of some smaller cities, its scale, wealth and depth of demand continue to make it the most attractive destination overall.
Edinburgh follows closely in second place, recording the highest GDP per head in the UK at £69,809 and one of the strongest employment rates, at 82.1 per cent. The combination of high productivity and workforce stability provides a solid platform for businesses seeking predictable demand and access to skilled talent.
Outside the traditional commercial powerhouses, several regional centres stand out. Bournemouth ranks third and leads the country for five-year business survival, at 43 per cent, underlining the strength of smaller cities with diversified local economies. Norwich and Bristol complete the top five, benefiting from strong employment rates, healthy start-up ecosystems and comparatively resilient consumer demand.
Major regional hubs also feature prominently. Manchester and Leeds remain attractive for expansion due to their scale and economic output, while Glasgow rounds out the top 10, supported by a solid business survival rate and growing start-up activity.
However, the research highlights a more challenging outlook for several large urban centres. Cities such as Birmingham, Leicester and Liverpool rank lower, reflecting weaker disposable income levels and lower five-year survival rates. For expanding businesses, these conditions can translate into more volatile demand and higher operational risk.
The report also points to a shift in how founders are approaching growth. Rather than rapid expansion, many are adopting a more disciplined, data-driven strategy as economic uncertainty persists.
Hugh Acland, chief commercial officer at Capital on Tap, said: “The current economic climate may feel challenging, but growth is absolutely achievable. It requires deliberate, informed decisions and the confidence to adjust as conditions change, meaning there are opportunities for founders who understand their numbers and plan carefully.”
With consumer confidence still fragile and access to funding uneven across regions, the findings suggest that in 2026, expansion will be less about ambition alone and more about choosing locations with the economic resilience to support it.
