13th November 2017
Where are the potential Step Up businesses?
Just as Britain’s home businesses are spread across the country, so too are the core group of home businesses that would like to move out of the home and Step Up. Our survey has found that a fifth of home businesses in the Midlands, North, East and London are considering moving into a commercial space. The even spread across these areas indicated that ambitions run high in all corners of the country. The South region follows this group, with 17 per cent of home businesses there expressing a desire to move out. Meanwhile 11 per cent of home businesses in Scotland and Wales are keen to move out.
These regions could seen an impressive uplift in profits, should the potential Step Ups move on from the home. The South stands to gain the most, with an estimated uplift of £922 million. The North and London follow closely behind with £667 million and £595 million respectively.
A lack of suitable commercial properties could be a constraint on Scottish and Welsh businesses. Profits could also play into the reluctance. For example, home businesses in Wales are found to generate less profits on average than the other regions- meaning growth might be slower. The commitment of paying commercial rent is the main reason for reluctance to move among home businesses.
What do these ambitious businesses look like?
We’ve seen that for the most part, our Step Up businesses are spread across the UK. They also come from a wide range of sectors. We’ve seen a desire to move out of the home from businesses in the retail, construction, media and marketing, IT, finance and hospitality sectors. Leading the charge are the retailers- 26 per cent say they’re keen to move out. This could be down the fact that owning a shop is a natural next step in the growth of a retail business and would help these companies to attract more customers.
Home businesses specialising in media, marketing, advertising, PR and sales follow the retailers with 19 per cent saying they wish to move. Construction comes in third, with 18 per cent. The hospitality and leisure sectors are seen to have the least desire to take a commercial space, with 12 per cent.
Who are the would-be Step Up businesses?
We’ve seen where our potential Step Up businesses are and we’ve has a dive into what many of them do. But who are the entrepreneurs behind them? We’ve discovered that the age group most eager to move out of the home is the under 35s. In fact, 35 per cent of home business owners in this age bracket are interested in new premises. One in four 35 to 54 year olds responded saying that they would like to relocate, while the older generation of entrepreneurs, of 55 and over, are least interested in a move. Only 11 per cent of over 55s expressed a desire to move on
This could be down to the fact that younger people may have started their home businesses more recently and are in a faster growth trajectory. The older generation may also be more risk averse than millennial founders.
Our research has found that when it comes to gender, male and female founders are fairly equal and are both as likely to consider relocating their businesses. 17 per cent of men and 18 per cent of women told us they were keen to move out.