Britain's Conservatives paid tribute to Margaret Thatcher on Sunday at their annual conference, praising her legacy and selling merchandise with an entrepreneurial spirit the former prime minister would have been proud of.

Baby bibs bearing the words "Little Iron Lady" were sold out within hours of the conference opening in Manchester, northwest England, although there were still "Iron Baby" versions available to buy for ??8 ($13, 9.5 euros) each.

Current Conservative Prime Minister David Cameron led the eulogies in a ten-minute video message which kick-started the conference, the first since Thatcher's death in April, and delegates responded with a standing ovation in her honour.

Outside the main hall, the merchandise stall was doing roaring trade in special Thatcher t-shirts, mugs and coasters and even a special bottle of beer dubbed "Our Maggie".

Thatcher was 87 when she died and had long been out of the public eye, but she is still a beloved figure among Conservatives for her time as prime minister between 1979 and 1990.

Her ashes were laid to rest alongside the remains of her husband Denis in a ceremony in London on Saturday.