Home businesses in London could generate an additional £2.76bn in revenues if they expanded into commercial premises, a new report has revealed.
An impressive 21 per cent of businesses in London operating from a kitchen table, garage or the like are considering moving into commercial premises, the study from the Centre for Economics & Business Research (Cebr) and YouGov revealed.
They expect to increase turnover by a third and profits by a fifth on average, meaning profits in businesses across London could climb by a total of £595m. But the respondents noted that the high cost of commercial office space is holding them back.
“Home businesses are an important driver of the economy in London, however many are being held back and unable to scale due to the high cost of commercial office space,” said Simon Burckhardt, managing director of cloud-based communications business Vonage UK which commissioned the study.
“It’s crucial that this issue is addressed at national and local government level for the benefit of the national economy as a whole.”
A high percentage of home businesses across the rest of the UK were also looking to scale up – 21 per cent in the east of England and 20 per cent in the Midlands and the south of England, compared to a national average of 18 per cent.
Adam Sopher, founder of popcorn brand Joe & Seph's, said his business managed to get around the jump to commercial premises by taking advantage of flexible models.
"Initially we moved to a ‘rent-by-the-hour’ kitchen because we didn’t know what the business would need so were hesitant to commit to a 10-year lease," he said.
"We soon transitioned into a ‘rent-by-the-month’ kitchen and then to the larger site where we are currently."
There are currently 2.7m home businesses operating around the country, 40 per cent more than in 2000.