Sunday, 9 November 2008

Home Business Report 2008. A Summary

October 2008 saw the launch of the BT Small Business Week, in conjunction with the publication of the Home Business Report 2008, featuring ourselves, 1st Addition Accountancy, as one of 16 case studies.

A link to this is given in our post of 13 October, however, this document is 54 pages long, so what, if any are the key findings?

Some of the more pertinent ones are listed below:

  • The 2008 report highlighted a 16% increase in businesses running from home.

  • This brings the total, in the UK, to over 2.5 Million. (Out of a total of 4.7 Million SMEs in the country).

  • Recent research, by O2, shows that many businesses are choosing not to renew their leases on business premises, and that 60% of those still in commercial property are considering giving it up to relocate back to a home environment.

  • Home based businesses now make a significant contribution to the economy, as expressed by Professor Colin Mason, of Strathclyde University; "The popular belief that home based businesses are part time, small and marginal does not reflect the reality. The majority provide work for other people, and just over half are generating revenues of more than £50,000 per year".

  • There are 5 key factors influencing the rapid growth of the home business sector:
  1. Reducing Costs (Primarily in terms of rent and travelling, but there are others).

  2. Increasing Income (Often in conjunction with another job).

  3. Greater Demand (More requirments for the niche products and services they provide).

  4. Lifestyle Choice (Offers freedom and flexibilty, thereby fitting in with family commitments).

  5. Advances In Technology (Allowing / assisting the increase in cost effective tele working).
  • This popular way of working shows no sign of slowing, with 71% of home based professionals believing they can grow or maintain their business levels throughout the current economic downturn.

  • The most popular ideas for entering into this market sector are currently via franchises, and the number of opportunities in this area are likely to rise significantly in the coming months.

  • Not all business for the home based Entrepreneur is locally sourced. Back, once again, to Professor Colin Mason, for words of wisdom; "Contrary to what might be expected, home based businesses are not excessively dependent on their local market for sales: only 47% derive more than half their sales locally, compared with 56% for other SMEs. Indeed, home based businesses are more likely than other SMEs to derive a high proportion of their sales from regional and UK markets".

  • 82% of home based business owners responded that technology was either critical, or very important as a factor, in enabling them to work from home.

  • A further 67% felt that technology had helped them to attain a better work / life balance.

  • So. What about the future? When asked what they would most like to see in their area, home businesses replied, in the majority, that they'd appreciate more events and networks tailored for their specific needs. Physical infrastructure (hubs live / work units, professional meeting space & enterprise units) came a close second.

The report is a comprehensive look at the home business sector, and includes 14 pages of survey data, giving a further insight into the world of the home based business owner. It's a sector of the market we ignore at our peril.

You can check out the Home Business Report 2008, in full, by clicking on the heading, at the top of this article.


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Bring it home.