Founding a business is a risky yet exciting endeavor, as many people who start a business are following their dreams. Before starting a business, you have to take many things into consideration. One of which is the practicality of launching a business in a particular area at a particular time, as well as how likely that business is to survive.
Looking at these statistics can prepare you for the reality of opening your business.
What do the statistics tell us?
In London, an increasing number of business are being established, with over 400,000 having been established in 2016 alone. The majority of businesses being established fall within the business administration and support services sector, the transportation and storage industry, and in education.
However, the businesses with the highest survivability rates, which means those that last the longest, are in healthcare, property, and information and communications.
Just as businesses are born each day, many are closed every day too. The majority of those businesses that die each day fall into the realm of finance and insurance, business administrations and support services and property.
Although property falls into the highest death rate and the highest survival rate, the survival rate of the property industry outnumbers its death rate by at least 35%, so it is still a feasible business venture.
It is also important to note that the accommodation and food services industry has the lowest rate of longevity. Many who open these types of establishments do not see continued success.
Although many businesses shut down, the number of businesses established each year continues to outnumber those that are closed. This means that finding space for all of these businesses will eventually become more challenging.
Where are the best places to open a business?
As far as location is concerned, London has both the highest birth and highest death rates for businesses, but only by about 2-3%.
Unfortunately, London also has the lowest survival rate at almost 42%. The locations with the longest survival rates, which would be the best places to open a business, include the Southwest, Northern Ireland, and the Southeast.
What is a Flexible Workspace?
One of the latest trends in business is flexible workspace. Exact definitions of this word will vary depending on who you ask, but the general underlying concept is still there.
A flexible workspace is a workspace that can be used by different people or businesses at different times and for different purposes. The idea is that a property manager owns a building that has a variety of office space options that are rented out monthly, daily, or even hourly.
For example, a small startup that doesn’t have a conference room setup available could rent a conference room from a flexible workplace location.
This way, the small business can host a professional-looking meeting without the cost of renting or leasing a large property for an extended period of time.
Why do we need it?
Running a business successfully requires income coming in to the business to exceed the amount of money going out of the business. If businesses are spending a large amount of money leasing or renting a property that is too large for their everyday operations, they are essentially wasting money. They end up paying to rent space they do not utilize every day.
Flexible workspacesare a great way for businesses to save money. Another benefit of flexible workspace is that businesses that share the workspace will also have an opportunity to collaborate and share ideas. This could create competition between businesses, which could be good in that it could drive up productivity. It could also result in the birth of new ideas.
London is home to the largest number of flexible workspaces, with around 10% of the London market being comprised of this type of office space. Finding an affordable location to do business in London shouldn’t be a problem for you.
No matter the location or the industry, opening a business is always going to be a risk that you take. However, doing some research and looking at the numbers can serve as a guide for you as you begin the process.
Don’t forget to take into consideration the possibility of utilizing flexible workspace as an alternative to renting or leasing space that you just don’t need right away.