Friends and relatives put an average of six hours a week into helping these micro-businesses stay afloat, according to a report by Lloyds Bank Insurance.
While four out of ten (41 per cent) micro-businesses pay their family and friends with an average salary of £14 per hour, just over half (51 per cent) say this support is unpaid, meaning the UK’s family support economy could be worth around £64.3 million per week.
This support ranges from helping to make business decisions (40 per cent), completing practical tasks (34 per cent), running errands (29 per cent) managing social media accounts (10 per cent) and helping with childcare (8 per cent).
While partners are most likely to head up the family support economy (43 per cent of businesses are helped by their other half) one in five (19 per cent) also rely on their children, and almost three in ten (29 per cent) use friends.
The benefit of this help lifeline is keenly felt by the nation’s micro-businesses, with the vast majority (84 per cent) saying the contribution of friends or family has had a positive impact on their business.
Aside from increasing revenue (13 per cent), increasing productivity (25 per cent), making the business more manageable (35 per cent) and providing emotional support (30 per cent), nearly a quarter (24 per cent) feel the help of friends and family is crucial in keeping their business running.
One in ten (10 per cent) micro-business say their business would not be able to go on without this support.
Damien McGarrigle, head of business insurance at Lloyds Bank Insurance says that starting up and running a business can be all-consuming, with family and friends often rallying around small business owners to ensure they are successful.
‘However, micro-business owners cannot solely rely on personal contacts to ensure everything runs smoothly.
‘Our research found that a third of those polled experienced problems in the past year from technology failures to employee sickness which resulted in more than a quarter operating at reduced capacity.’
Further reading on help from friends and family
