The true value of home based businesses and is it for you?
It is well known that small businesses, sole traders and the self-employed form the backbone of the economy. What is less appreciated is that more than half of these businesses operate in, or from, the home. The Scottish Government estimates that 56% of businesses in Scotland are home-based. This report provides the first ever profile of homebased businesses in Scotland; revealing that home-based businesses account for 17% of all private sector employment and almost 10% of private sector turnover in Scotland. The report is based on a survey of the Scottish membership of the Federation of Small Businesses.
Small businesses, sole traders and the self employed form the backbone of all economies. Their significance is increasing. In the case of Scotland the latest official statisitics indicate that 71% of businesses are sole traders with no employess, a further 24% have 1-9 employess and 9% have between 10 and 49 employees. Together they account for close to half (49%) of the employment in the private sector and one third of turnover.
The majority of home-based business owners are male (66%) with the gender split between male and female business owners almost identical for home-based businesses and other businesses. Home-based business owners are more likely than owners of other businesses to have no children (18 and below) living at home (74% cf. 69%). The proportion of women business owners who had children is almost identical for both home-based business owners and others (28% cf. 29%). But women home-based business owners had more children than women owners of other businesses (mean of 1.92 cf. 1.75). Further analysis suggests there is some support for the ‘mumpreneur’ home-based businesses owner stereotype, but on balance the home-based business sector does not attract more women (with or without children).
Nearly four in ten businesses defined themselves as home-based businesses, operating in or from domestic premises. More than half of all businesses started in their home, with 31% subsequently moving into commercial premises. Meanwhile, 13% of home-based businesses started in commercial premises and subsequently moved into the home. For the majority of current home-based business owners, home is seen as being the permanent location for the business.
(Extract from Federation of Small Businesses, report by Prof Colin Mason & Dr Darja Reuschke)
Checklist for starting a business from Home
Advances in technology mean that many kinds of business can be run from home. Starting a business from your home can have a number of benefits. These can include:
reduced costs • no need to travel to work • flexible working hours
Advantages and disadvantages of home-based business.
The major advantages are that you:
• don’t have to spend a lot of money on office rental or office purchase
• save time and money by cutting your commute
• can be flexible around the hours you work
The disadvantages are:
• it may prove difficult to keep work and home-life separate, and there may be domestic distractions and interruptions
• a lack of contact with other people and businesses
• you might end up working long hours
• your mortgage, home insurance and tax situation may be affected
Popular home business ideas
If you do not yet have a home business idea, ask yourself three questions:
1. Is there a gap in the market? Have you tried to buy something that you just can’t find? Others may be looking for that product too.
2. What is my passion/skill/hobby? Can you find a way of making a living from it?
3. Can I do something better? Have you seen someone offer a product or service that you think you can offer better yourself?
Consider opportunities in your local area for services such as child care, tutoring, translation, editorial services, dog walking and alteration services.
Other common home-based businesses include:
• website designers
• arts and craft makers
• virtual assistants who provide professional assistance to clients from a home office