Out of the several determinations to be made before starting a business, one crucial decision is the location. The place wherein a business is located is essentially the heart of its operations. The location must be chosen with care, considering that it is the connecting organ for several business processes.

For instance, especially for small and medium enterprises, the employees are often a tight-knit group of people from the same locality. Further, a range of factors such as the transportation of the team for the daily operations, logistics of raw materials and finished products, and accessibility for consumers also make it important to select a well-connected place of business. However, an undeniably decisive factor that determines the choice of the location is the financial ability to support it.

The costs involved in renting, leasing, or buying a property for carrying out business, as well as the recurring costs of maintenance and operations, are known to limit the possibilities for many entrepreneurs. So it is an extremely common practice in India for SMEs to operate out of their owners’ homes.

Since the scale of the business is limited in the beginning, the space provided by one’s home is often enough. The employees also find it easy to reach their workplace so they can work longer since there is no commuting time. The locality is familiar for the entrepreneur and often comes with established contacts, reliable sources, and pre-existing goodwill that attracts consumers.

The fact that the entrepreneur does not need to allocate a considerable amount of funds for renting or leasing out a new location, is normally the prime influencing factor behind choosing to work out of one’s own home. It is in this context that the world of SMEs and the subject of affordable housing are intricately interlinked.

With a majority of the MSME sector being located in rural areas, the accessibility to housing cannot be taken for granted. Opting for separate spaces to operate a business is a distant dream for most and a privilege reserved for a small minority. In such a scenario, making affordable housing available solves two problems in one stroke.

Families are provided with the assurance and comfort of having a secured space to stay. Additionally, with the help of the same space, people with an entrepreneurial mindset can operate their businesses with no incremental cost of real estate. Not only can the affordable housing facilities provide a location for business operations, but the proceeds and profit from the business can in turn be used to repay the loan secured for affordable housing. Thus, the story of the mutual benefit derived comes a full circle.

In my opinion, improving access to affordable housing across various strata of society and creating awareness regarding existing mechanisms can boost the SME sector in India.