Small Business Profit Margins by Industry in the UK, Australia, and New Zealand

Looking for the highest profit margin products, the typical small business profit margin, or the average profit margin by industry in the UK, Australia or New Zealand? This guide uses anonymised, aggregated Unleashed manufacturing data to show where margins are strongest – and how they’re changing – across three regions.

In our Manufacturing Health Index, Gross Margin Percentage (GMP) is calculated from the revenue and product COGS recorded in Unleashed (materials and landed costs). Direct wages and broader overheads are not included unless a customer capitalises them into stock, so GMP is not the same as net profit margin. Our goal is to show product-level profitability for small manufacturers.

All-Industry Profit Margin Snapshot (Q2 2025)

UK: GMP 38.4% (down 1.2pp QoQ; up 0.2pp YoY)

Australia: GMP 36.0% (down 0.3pp QoQ; down 0.6pp YoY)

New Zealand: GMP 36.1% (down 1.7pp QoQ; down 1.4pp YoY)

Highest Profit Margins by Industry (Q2 2025)

United Kingdom — Top 4 by GMP

1. Clothing, Footwear & Accessories — 62.92%  
2. Personal Care — 54.92%  
3. Furniture, Fixtures & Home Furnishing — 50.36%  
4. Sport, Entertainment & Recreation — 45.47%  

Australia — Top 4 by GMP 

1. Personal Care — 48.44%  
2. Health, Medical Supplies & Equipment — 45.89%  
3. Sport, Entertainment & Recreation — 45.71%  
4. Clothing, Footwear & Accessories — 43.74%  

New Zealand — Top 4 by GMP

1. Clothing, Footwear & Accessories — 62.61%  
2. Personal Care — 55.57%  
3. Furniture, Fixtures & Home Furnishing — 48.13%  
4. Electrical & Electronic Components — 42.77%  

UK Profit Margin Overview 

UK all-industry GMP averaged ~38% in Q2 2025. Apparel sits at the high end (~63%), while beverages and food lines are lower-30s to mid-20s depending on inputs and promotions. 

Australia Profit Margin Overview 

Australia’s all-industry GMP averaged ~36% in Q2 2025. Clothing & footwear leads (low-40s), construction suppliers and beverages cluster in mid-30s, food trends mid-20s. 

New Zealand Profit Margin Overview 

NZ all-industry GMP averaged ~36% in Q2 2025. Construction suppliers ~39.5%, clothing ~62%, beverages ~24%, food ~21%. 

What’s Moving Margins in 2025? 

Services-led inflation (e.g., logistics, energy) remained sticky through mid-2025, especially in the UK. This can squeeze GMP when costs rise faster than price updates. 

PMIs around the Q2/Q3 handover pointed to subdued-but-stabilising manufacturing demand, often associated with price competition that can pressure margins at SKU level. 

Profit Margin Trends and Sub-Industry Highlights 

Profit Margin Trends: UK

Over the past year, UK manufacturers have maintained relatively strong gross margins, with the all-industry GMP averaging around 38–39%. However, Q2 2025 saw a slight dip of 1.2 percentage points compared to Q1, reflecting higher replenishment costs and longer lead times. 

• Notable gains: Construction suppliers held steady at ~32.6%, showing resilience despite softer sales volumes. 
• Notable declines: Food manufacturing margins fell by 5.6pp QoQ, driven by rising freight and packaging costs, while Beverages dropped 5.1pp, likely due to promotional activity and input cost timing.

Profit Margin Trends: Australia 

Australian SMEs have seen margins hover in the mid-30% range for the past year, with Q2 2025 at 36.0%, slightly down from Q1. 

• Notable gains: Beverages improved by +2.6pp QoQ, suggesting better cost control or premium pricing strategies despite lower sales. 
• Notable declines: Food manufacturing margins fell 4.5pp, reflecting commodity price volatility and packaging cost increases. 

Profit Margin Trends: New Zealand 

New Zealand margins have been more volatile, averaging 36–37% over the past year but dropping 1.7pp QoQ in Q2 2025. 

• Notable gains: Construction suppliers remain relatively strong at ~39.5%, supported by steady project demand. 
• Notable declines: Food manufacturing margins fell 6.0pp, and Beverages dropped 3.0pp, both pressured by rising utility costs and input inflation. 

Key drivers across all regions: 

• Input cost volatility (freight, packaging, energy) 
• Promotional activity in competitive categories 
• Longer lead times increasing landed costs 
• FX fluctuations affecting imported components 

How to Protect and Raise Your Gross Margin 

• Keep price files flexible: Update price lists in bulk when input or freight costs shift. 
• Tighten BOM costing: Roll up materials, wastage and packaging accurately. 
• Replenish with service-level logic: Use forecast-driven reorder points and safety stock. 
• Offset promo drag: Use bundles or value-added variants to maintain blended GMP.

Download the Full Report 

Get the full Q2 2025 Manufacturing Health Index with analysis and latest figures on sales revenues, lead times, margins, purchasing and stockholding strategies - plus sub-industry rankings, and quarter-on-quarter movement tables for the UK, Australia and New Zealand. 

Frequently Asked Questions

What is a good gross profit margin?

It depends on your sector. In our Q2 2025 sample, all-industry GMP averaged ~36–38% across UK/AU/NZ. Premium categories often >40–60%, cost-sensitive categories ~20–30%. 
 
Learn more: What is a Good Profit Margin?  

Why do your margins look higher than other sources?

You're likely comparing gross margin (ours) to net or EBITDA margins. Gross margin counts product costs only; net/EBITDA subtract broader costs. 

Does your GMP include wages?

No – not by default. GMP here reflects materials + landed costs. Direct wages/overheads are excluded unless capitalised into inventory. 

Q2 2025 GMP by Industry 

United Kingdom (Q2 2025)

Australia (Q2 2025)

New Zealand (Q2 2025)