Picture a lap-dancing club. There's the pole, of course, and the private booths. But, writhing on the dance floor and around the male clientele, are there painfully thin, drug-addled girls? Are the men wearing greasy raincoats and leering grins? If you presume yes, think again. Gone are the quiet cash deals and the enforced extra services - the trade in ladies has gone legit.

The sex industry is one of Britain's fastest growing. Bright young business leaders, men and women alike, have recognised the potential of the world's oldest profession. Their determination to move lasciviousness into the mainstream and their use of the opportunities opened up by the new media has done much to aid their meteoric rise. Now big firms and City traders want to join in.

Erotica, the bi-annual trade fair at Olympia, is a case in point. More of an adults-only Ideal Home show than a full-blown, whip-cracking exercise in hard-core perversion, it was nevertheless thrown out of Scotland in 1998 after 25,000 Presbyterians picketed it.

Such has been the revolution in the way the sex industry is viewed, however, that more than 50,000 visitors are expected when the fair comes to London later this year. Sabbas Christodoulou, the Essex businessman behind the event, plans to float it on the Alternative Investment Market or Nasdaq next year, to raise up to £8 million to aid his expansion into internet erotica.

Beate Uhse, the 80-year-old businesswoman who has been running a chain of in-your-face sex shops in Germany for half a decade and who floated her company on the Frankfurt stock exchange for £431m last year, is planning to open 50 sex supermarkets in Britain by 2002.

Aware of the surge in competition, Ann Summers, Britain's home-grown purveyor of sex toys and lingerie, is also planning an ambitious expansion programme. It already commands a £43m turnover across its 35 branches, and owner David Gold plans to treble the number of high-street stores by 2003, making him one of Britain's wealthiest men.

Although it is fair to assume that the liberation and growing self-confidence of women is behind the growing popularity of sex shops, it is less easy to attribute the girl-power pound to the burgeoning profits reported by Britain's lap-dancing venues. It's not so much the increase in female customers that is responsible for our increased custom as the change in society's attitude towards sexuality and nudity, combined with the industry's determination to distance itself from the sex-pot, hellholes of the past, said Caroline, a housemother at Secrets lap-dancing club in Hampstead, north London. It's no longer just working-class men or sleazy City boys who come to these sorts of venues, she claimed. A night out and girls go together more naturally for more men now than beer and curry.

Richard Desmond, owner of Northern & Shell, which publishes OK magazine as well as a string of porn publications, is about to make a fortune from the broadening of social attitudes. Desmond announced flotation of his business in February, a move which could see his empire valued at £500m, which will be ploughed into online pornography. Stan Myerson, joint managing director of the firm, believes the industry's determination to clean up has enabled it to appeal to a previously untapped market, once intimidated by tales of exploitation and sleaze. It's the start of something enormous, he said. People are realising that they can come to us in safety. But there are still clubs which exploit and abuse women they employ. Jordana, 21, a student, has been a lap-dancer for two years in London clubs. There are clubs which look after you so well that you're probably safer there than walking down your local high street on a Friday night, she said. But there are clubs that employ the women who aren't there out of their own free choice,' she added. 'The women who can't make money any other way or who have racked up huge debts. They are the ones without the power to say no. These are the clubs where the girls are expected to sleep with the boss, - and often his friends - on demand. They work six nights a week in situations that exploit dependency and crush the spirit.

But these are also the clubs which, Myerson insists, will be driven out of business as mainstreaming of the industry continues.