Most start-ups based at home

Seventy per cent of all new businesses are started at home, research by AXA Business Insurance and the Enterprise Nation business network has found.

The Home Business Insight Report, a survey of nearly 800 home-based businesses, also revealed that two thirds of home businesses are run by women.

Business services (37 per cent) is the most popular sector for home-based firms, followed by crafts (19 per cent) and retail (10 per cent). Of those surveyed, 79 per cent expect increased turnover in 2014.

Other findings:

• Growth:
  • 53 per cent of those expecting growth this year will increase the efficiency of existinresources to cope with more work
  • 35 will outsource contracts to freelancers
  • 12 per cent will take on full or part-time employees as a result.
• Technology:
  • two thirds said that modern technology has been a critical factor in enabling them to run their business from home
  • One in 10 businesses based at home previously had business premises.
• Finance:
  • more than a third of those setting up business from home didn't need funding to get started
  • those that did were most likely to have funded their businesses through personal savings
  • 20 per cent have part-time jobs in the early stages to avoid the need to seek finance
  • 32 per cent are concerned about finding the additional finance to fund this year's potential growth.

Emma Jones, founder of Enterprise Nation, said:

"Home businesses are playing an increasingly important role in the British economy. The 4.5 million micro and small UK businesses contribute £1.6bn to the British economy - 75 per cent of these are registered as having 'no employees'.

"It's interesting to see these people are not reliant on banks at all. Low start-up costs at home negate the need to take on board complicated routes to finance for these entrepreneurs."