The city approved 131 businesses in 2016, down from 145 in 2015; 57 of those — or 43.5 per cent — got started in the entrepreneurs’ residences. Recent years have also seen a number of home-based businesses approved by the city — 29.7 per cent (43) in 2015, and 36.4 per cent (59) in 2014.
Dave Mullett of Midnight Tailors, whose business got city approval in September, said money is the main reason he and his partner, Shara Desiree King, work from home.
“The first year of operations leaves little money to eat and survive, let alone pay for a (typically overpriced) space to work and do business out of,” he told The Telegram.
Mullett said their two-person venture couldn’t possibly afford to work out of a storefront in downtown St. John’s due to rental prices and business and property tax rates.
“When titans such as Templetons and Ballistic can’t afford to stay in business, it certainly doesn’t increase the attractiveness of operating a small business downtown.”
But the couple says working from home is comfortable and allows them to be flexible in their schedule — a schedule that doesn’t necessarily fit in with regular opening hours.
“I would recommend any up and coming small business owners to strongly consider operating out of the home. It drastically decreases overheads, and could potentially chip in on the regular expenses that come along with running a household,” he said.
St. John’s Coun. Dave Lane, who also heads Common Ground Coworking, suggested the increase in home-based businesses in the city is part of a larger trend. He said it allows people to test things out before going big while spending little on overhead, and access to a large market online helps.
“But I think you’re also seeing, in the economy, a lot of projects are running down. People are looking for new opportunities for employment, and trying your own thing is a great way to do that,” he said.
Lane said he doesn’t think there are St. John’s-specific tax issues driving people to start home-based businesses.
“I think that it’s just a lot easier to work out of home, and I think that’s a trend that has been growing for the past few years, and we’re really starting to see the result of that,” he said.
The councilor-at-large said he’d like to see the city do more to help startups and other small businesses whether they’re home-based or not.
“By letting people start their own business, try something new, you’re actually strengthening the economy. Because if you have a lot of people trying what they are good at and what they love, you’re getting a lot of diversity and you’re seeing the potential for new things to grow. Starting at home is a cheap way to do that, and all the power to them,” he said.