Regional businesses drive mid-market expansion but targeted support required to maximise growth
Regional businesses drive mid-market expansion but targeted support required to maximise growth
- Businesses in the North West of England and Northern Ireland record the highest growth in turnover
- UK-wide, mid-sized businesses outperform the FTSE and smaller businesses
- BDO recommends targeted support measures to maximise the growth potential of the mid-market, which now contributes £2.44 trillion to the UK economy (up 3.1% YOY)
Britain's mid-market businesses are proving resilient to rising costs and uncertainty, growing in number by 4.4% in the last year, new data from BDO shows.
This increase was driven by the strength of regional economies, with mid-market business expansion in the South West (+6%), East of England (+5.4%), and the North West (+4.7) outperforming the national average. Scotland now counts over 2,000 mid-market businesses, an increase of 5.1% year-on-year.
Against a backdrop of challenging economic headwinds, this demonstrates the resilience of the UK’s mid-market, defined by BDO as businesses with revenues of £10m-£500m including those that are AIM listed or private equity owned.
Despite comprising less than 1% of private sector businesses, the UK mid-market accounts for more than one in three private sector jobs and more than 40% of private sector revenues, employing 11.1m people and generating revenues of £2.44tn.
BDO’s data shows that the revenue growth of these businesses (3.1%) has once again outperformed the FTSE 350 (0.9%) and smaller businesses (-0.2%) in the same period.
While London remains the economic powerhouse, with mid-market businesses based in the capital contributing £700 billion, the North West saw the fastest turnover growth in England, up 6.1% YOY in Q2 2026, now contributing £200 billion. Turnover in Northern Ireland also grew by 6.3%.
Agriculture, Horticulture & Livestock was among the strongest performing sectors, recording an 8% increase in turnover and a 12% increase in the number of mid-market businesses. The Construction (+7%) and Financial Services (+10%) sectors also saw strong turnover growth.Meanwhile, turnover growth in the Manufacturing (0%), Industrials (-0.6%) and Natural Resources (0.1%) stagnated.
Richard Austin, Partner at BDO, commented: “The UK mid-market has huge growth potential. These businesses create high-quality jobs, deliver local investment, and drive innovation, and it is particularly encouraging to see expansion in regions beyond the South East, defying challenging conditions.
“Where growth in some sectors is stagnating, it is essential the government listens to the signals and provides these businesses with more targeted support.
“Mid-market businesses are overlooked and undervalued. They often fall into a policy gap - too large to benefit from start-up support yet too small to influence government policy or win the recognition that the largest corporates command. With the right support, they will continue to play an outsized role in delivering economic growth across the country.”
Recommendations to secure future growth
BDO has published its latest Mid-Market Manifesto, a series of policy recommendations for the government to maximise support for UK mid-sized businesses.
This includes:
- Recommendations to simplify the tax regime to promote investment, boost employment, and back entrepreneurship.
- Measures to address skill shortages across sectors and regions, including protecting access to apprenticeships for priority technical skills, ensuring mid-market firms have access to more flexible training, and prioritising the roll out of the government’s proposed “clearance-style” apprenticeship pilot scheme.
- Sector-specific policy suggestions to support businesses in several of the growth-driving sectors identified in the government’s Invest 2035 Modern Industrial Strategy where the UK has or could develop a competitive advantage: Advanced Manufacturing; Life Sciences; and Professional & Business Services.
Shevaun Haviland CBE, Director General of the British Chambers of Commerce, said: “We know that helping mid-market businesses to grow and thrive can have a significant impact on economic growth, with a 1% increase in growth potentially adding £35bn to the UK economy. Therefore, we welcome this timely report from BDO, setting out policy measures to support investment, productivity and international competitiveness.
“In our most recent Quarterly Economic Survey, half of responding firms (51%) said that they were now more concerned about taxation than they had been three months ago. Simplifying the tax system through measures outlined in this report would have a tangible impact on business growth.”
ENDS
Note to editors
About the research
The mid-market is defined by BDO as businesses with revenues of £10m-£500m including those that are AIM listed or private equity owned.
BDO’s data found that Mid-market companies employ 11.1 million employees. 28.2 million people are employed in the UK’s private sector, therefore the mid-market provides almost two in five (39%) private sector jobs.
Turnover of mid-market companies between 2005-2006 was £2.44 trillion. The total revenues generated by the UK’s private sector was £5.5 trillion in 2025, meaning the mid-markets accounts for more than two fifths (41%) of private sector revenues.
About BDO
BDO LLP operates in 19 offices across the UK and Ireland, employing 8,500 people. It has revenues of £1.1bn.
It provides Audit, Tax, Deals, and Consulting, Risk & Outsourcing (CR&O) services predominantly to the entrepreneurial, ambitious and growing mid-sized businesses that are driving growth in the UK and Ireland economies.
BDO LLP is the UK and Ireland member firm of the BDO Global network.
BDO Global
The BDO international network provides business advisory services in 169 countries and territories, with 95,000 people working out of 870 offices worldwide. It has revenues of US$11bn.
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