As homeworking looks set to become a permanent feature of the business workplace, it presents smaller firms with both opportunities and challenges. Agility is key to reaping the rewards, but changes bring costs. How can these companies afford them?

What are the opportunities and challenges of homeworking?

New research from Hitachi Capital Business Finance says that some small businesses could save up to £4,000 a month by ditching the office and embracing homeworking. However, while it’s an attractive figure, such a step isn’t feasible for a large number of firms that can’t abandon the office.

For most office-base small businesses, the impact of the homeworking trend lies somewhere in between. For some there may be an opportunity to downsize office space and adopt more flexible working practices. If this is a realistic goal, agility is vital, not least in terms of the feasibility of moving, renegotiating leasing contracts and the availability of new spaces.

How cyber-security and wellbeing factor into homeworking costs

Downsizing isn’t the only cost consideration related to homeworking. One benefit of office-based working is the higher level of cyber-security this affords businesses. Office-based systems are generally more secure and offer firms much stronger protection.

Working at home means greater use of personal devices, with this use of unprotected systems leaves businesses much more vulnerable to cyberattacks. It is no coincidence that small businesses have been increasingly targeted by cyber criminals since the pandemic hit and staff switched to homeworking en masse. While this risk can be mitigated by upgrading software and hardware, this comes with a hefty price tag.

Similarly, the sharp rise in homeworking also means that firms have to think differently about employee wellbeing. The subject has been brought to the fore as a result of the pandemic, with employers increasingly obliged to do more to ensure the wellbeing of their employees.

Outside of the office environment, making sure that employees have the right office equipment and following healthy working practices is more difficult to monitor and deliver. And it represents an extra cost.

What are the solutions to managing homeworking costs?

With all this and more in mind, as small businesses look to adjust to an increasingly permanent trend, how can they afford the costs?

Alternative finance can help. In the wake of prolonged caution from traditional lenders, which is an issue that has returned during the pandemic, services such as invoice finance, asset finance and peer-to-peer lending, are proving a vital source of capital for small businesses, both for maintaining cashflow and for essential investment.

These facilities, which offer a more easily accessible and personalised approach to lending, are helping small businesses survive and target recovery and regrowth.

Furthermore, alternative lending is playing a prominent role in the government’s headline emergency support scheme, the Recovery Loan Scheme (open until the end of June 2022). Invoice finance and asset finance between £1,000 and £10 million per business are available under the initiative. This profile is helping cement the reputation of alternative finance in the business sector.

Adapting to homeworking and small firm finance options

The pandemic has radically changed the workplace, including in terms of homeworking, and this particular shift holds both pros and cons for small firms. Key to successfully managing this trend is strong financial planning. This is why it is vital that owners are aware of all the financial options available, including the services of alternative lenders.

To find out more about A&T Business Associates services, contact Tony Hedger on 01903 602211 or tony.hedger@atbusinessassociates.co.uk.