Harnessing business growth and creating the option to sell your business in the UK’s defence industry
The defence sector is estimated to contribute around £10 billion to £12 billion a year to the UK economy. Comprising a range of long-standing and new businesses, this rapidly growing industry has always been crucial to the country’s operation and security – but now, its impact is set to strengthen even further as the government assigns more spend to it.
Naturally, this will shift the narrative for defence businesses and inevitably open new doors to scale up growth plans.
Businesses in the defence industry vary from more obvious contenders – such as aerospace, shipbuilding, and weapons manufacturing – to those providing electronics, communications, and widespread data. Existing to make Britain safer at home and stronger abroad, they account for 434,000 jobs (as of 2023).
What’s changing?
In February 2025, Sir Keir Starmer announced that the country’s defence spending will increase to 2.5% of GDP by April 2027. Similarly, he agreed to meet a new NATO target that demands we spend 5% of GDP on national security by 2035 – with 3.5% of that going on core defence and the other 1.5% going to defence-related areas, such as resilience and security.
Set to be the biggest increase in the UK since the Cold War, this signifies profound changes to protection amidst intensifying international conflicts, global threats and grey-zone provocations.
The government also launched a new defence strategy in response to an in-depth strategic review undertaken by former UK Defence Secretary and NATO Secretary General, Lord Robertson. Including nuclear plans, cyber investment, weaponry innovation and increases across the army, navy and air force, the new strategy encompasses the country’s biggest contribution to the military alliance yet.
“The next few years will bring huge opportunities for small businesses operating in defence.”
Hugh Griffiths (Former CEO and Co-Founder of Inzpire Ltd, Chair of Shield UAS Solutions Ltd, MAIAR and Metis Aerospace)
How can we help?
It’s clear that defence is no longer a lower priority. Investment of this scale will inevitably drive economic growth and create a substantial number of new job opportunities – and across it all, businesses already operating in the space will be catalysts for positive change.
We now work with seven businesses in the defence sector. The future of their industry may look different to previous predictions, but it shouldn’t hinder growth – rather, we believe it should accelerate it. The Strategic Defence Review presents some real, tangible opportunities. We’re here to help businesses navigate these with confidence.
Recently, we hosted a lunch for several defence-related businesses. There is real value to be gained from bringing similar businesses together – it’s an opportunity to learn from one another and share in relatable experiences. The lunch was a brilliant example of this, filled with insightful and candid conversations about the niche opportunities defence businesses now face both in the UK and internationally – from increased personnel to investment in technological advances.
However, regardless of the opportunities presented, it’s easy to feel lost amidst such rapidly changing external influences. We’re here to help defence businesses realign and reinvigorate their growth plans as they undergo a period of significant change. It’s about being reactive yet considered.
Get in touch
At Elephants Child, we work with business across a myriad of sectors. Our work is rooted in flexibility because, like the defence industry, no industry is stagnant – so no business plan should be unchangeable.
That’s why – although each client has a different set of goals – every client we work with is guided towards a future plan that allows for adaptations. We actively encourage businesses to think of the ‘what ifs’ so they can progress in the most secure yet advantageous way.
We make it our priority to carefully learn about the environment each client operates in and follow market trends to consider how they may impact businesses ahead of time.
Businesses are always moving. We’re here to ensure your business has a plan in place that moves with you and to help SME owners grow and ultimately sell their business.
References
https://commonslibrary.parliament.uk/how-much-does-the-defence-industry-contribute-to-uk-regions/