As the date looms for Britain’s exit from the EU fast approaches (at the time of writing we will legally leave at 11pm on 29 March 2019), there’s growing concern about what Brexit will mean for businesses and employment. People are questioning their future in the post-Brexit world. We’re going to look at why there’s never been a better time to start a small home-based business.
Soaring Levels of Start-Ups
According to Companies House, the number of businesses formed between April 2017 and March 2018 stood at over 620,000. That’s a staggering number that looks set to increase year on year. There’s a lot of support available for people starting their own businesses, including start-up loans, making it an attractive option for people tired of the 9-5 grind.
Around 60% of start-up businesses are set up and run from home. There’s no wonder the figure is so high when you consider the benefits of having a home-based business. Aside from being your own boss, there’s the 60-second commute and the option to run your business in your PJs. (Just remember to get dressed before you Skype a client, though!) You can build your business around your family commitments and kick that childcare bill into touch.
Starting your own business isn’t a particularly complicated process, and there are plenty of business opportunities waiting for you to take advantage of them. People up and down the country are spotting gaps in the market that match their skills and building successful businesses. There’s no reason why you can’t do the same.
3 Questions You Need to Ask:
Is a Home-Based Business Is Right For You?
This is a tough question to answer, truth be told. Home-based businesses aren’t suitable for everyone, but then again, no business model is suitable for everyone. Whilst many businesses can be run from home, it depends on the type of product or service that you’re wanting to offer. Here’s three questions you can think about to decide if home-based is the best option for you.
1)\Can I provide my service or create my product at home?
This is probably the key question that you need to ask yourself. If you’re wanting to provide a Virtual Assistant service, then as long as you have a space to work and a reliable internet connection, then the answer is yes. If, however, you’re wanting to sell cupcakes in a volume that will require you to have an industrial kitchen, then the answer is going to be no, I’m afraid.
2) Are there advantages for me in running my business at home?
For the most part, the answer to this question is going to be yes - but think carefully. The advantages might include flexibility, arranging your work around other commitments and not having to pay for business premises. Disadvantages might include not having a meeting room for client meetings or being disrupted when the kids are home from school.
3) Is my home suited to running my business?
This depends on what your business is, like #1, above. Do you have a spare room that you can convert into a home office? Can you perhaps convert the attic into a workroom, or the garage or a shed into a workshop? Is your business simple enough that you can run it from your kitchen table, even? For some types of businesses, you may need to consider the impact on your neighbours, too.
Brexit Boost for Home-Based Businesses
It seems like you can’t turn on the news or pick up a newspaper without encountering some kind of Brexit-related discussion. As the March 2019 Brexit deadline looms, everyone has got something to say about how Britain will change post-Brexit. The impact on businesses has been the focal point of much Brexit talk, with opinions divided on whether it’s good or bad news for small businesses.
Nobody’s saying that there won’t be challenges for small companies as the country gets to grips with doing business outside of EU controls. There are always challenges when something - anything - significant changes. However, there’s a lot of evidence that small businesses, especially home-based ones, might actually benefit from Brexit.
In a survey by OFX, around 63% of small business owners saw Brexit as an opportunity, not a threat. With the red-tape of the EU removed, there will be opportunities to change the way we do business. For home-based small businesses, particularly freelancers and contractors, changes to immigration laws may put a halt to the flow of foreign workers who will work for peanuts and increase the demand for UK-based skilled freelancers.
The Association of Independent Professionals and the Self-Employed (IPSE) also considers Brexit a positive, with their CEO Chris Bryce saying that “the UK can be a place where freelancing and contracting can thrive. New circumstances always bring new opportunities for freelancers.” One such opportunity is in the area of IT, which can be a great home-based business if done right. Larger businesses are worried that Brexit will create an IT skills gap, so home-based IT businesses will be in big demand.
Brexit-Fuelled Employment Crisis and the Skills Gap
Big businesses are worried about Brexit’s impact on trade, both imports and exports, so there’s concern that Brexit will bring about job losses. Lots of job losses. One study has predicted a loss of 87,000 jobs in London alone and up to 482,000 job losses across the UK (Cambridge Econometrics). This means there’s a possibility of a massive employment crisis that could last up to 30 years. Starting your own home-based small business before Brexit hits hard could be a good option - particularly if you have skills that are likely to be in demand after Brexit.
Post-Brexit, the predicted employment crisis is going to increase the number of businesses willing to work with contractors and freelancers. The costs of using freelancers and contractors are lower for businesses, with no employer national insurance contributions to make. If you’re savvy enough to set up your small business before Brexit, you can be ready and waiting to take advantage of the skills gap.
When you consider the fact that the 2008 recession actually caused a massive growth for the freelance marketplace, it’s easy to see why Brexit could be a great opportunity to ditch the grind of the 9-5 and start working for yourself. You’re not tied to one employer, meaning you’re not going to be trapped if their business is struggling. Working for yourself gives you flexibility that’s going to be necessary for post-Brexit success.
Top 5 Benefits of Running Your Business from Home
1) You’re In Control
Working 40 hours a week - even in a job you love - can sometimes feel like going through life on a treadmill. You’re always moving, but you’re not really getting anywhere. Someone else is in control of what you do, how you do it, and whether you’re going to progress in your career.
Taking the leap into starting your own business means you’re the one calling the shots. Yes, you still have to work (those bills won’t pay themselves) but there’s a freedom that you’ll only understand once you take the leap. You control the direction of your business, the clients you work with, and the profits you make. No more treadmill running - the progress you make is real, and it’s yours, not someone else’s.
2) Work Around Your Life Rather Than Fit Life Around Your Work
This is especially beneficial if you have kids. When you work for yourself, not only do you have flexibility in who you work with, but you have control over when you work.
Need to work your business around the school run? No problem! Do you suffer with a chronic illness that means you need to work from your bed? No problem! There are other benefits, not only for you, but for your family, too.
No more having to explain to your six-year-old that Daddy can’t watch the Nativity play because he’s working. As long as you get the work done, it doesn’t matter when you do it, with the exception of client meetings. Even those, you can schedule around your life. Your family will thank you for starting your own business, believe me!
3) Ditch The Commute
Leading recruiters, Total Jobs say that most UK workers spend a total of 400 days out of their lifetime commuting, with those commuting to London rising to 559 days. More than a year of your life wasted sitting in traffic. That alone is the only prompt some people need to start their own business. What could you do with that extra year of your life if you only had to factor in a 60-second commute every day instead?
4) Build the Career of Your Dreams
It’s true that most jobs offer some kind of career progression (even flipping burgers) but running your business from home takes career progression to a whole new level. When you work for someone else, you spend 40 hours a week doing what they want you to do, and if you want to develop your skills further, you often have to do that in your own time. Alternatively, you might be on a particular career track that dictates where you’re headed.
Working for yourself means you can finally pursue the career you’ve fantasised about whilst slaving for your boss. The only one dictating your trajectory is you. You want to take your business in a new direction? Do it! Want to develop a new skill? Do it!
5) Overheads and Expense Claims
Running your business from your home means there’s no overheads that come from renting office or workshop space - freeing up money for things like marketing. That’s a big bonus, especially when you’re just starting out. When you have your own business, you also have the advantage of the wonderful world of expense claims - expenses you can offset against your tax bill. If you use a dedicated room in your home as a home office, you can claim expenses for that, as well as stationary, office consumables and a mileage allowance when you drive to meet clients.
Brexit has struck fear into the hearts of big businesses, but for small, home-based businesses, particularly those who do contract or freelance work, there are definite benefits. There really has never been a better time to ditch the 9-5 and set up business from your own home. There are certain skill areas that are going to be in big demand post-Brexit, so if you can position your new business to take advantage of that, you’ll be sure to succeed.
Our Take On Brexit
At Red Cloud, like any responsible business, we're preparing for the potential impact Brexit may have. Our client's can be reassured that regardless of the terms on which the UK leaves the EU, (if indeed we leave at all), our team will be on hand to continue our day to day jobs that ensure website's remain live and updated.
We'll be writing our opinion on the wider topic of Brexit - the rights and wrongs - in the coming days.