What Is A BID?
The Role of a Business Improvement District
A Business Improvement District (BID) is a business-led and business-funded organisation created to improve a specific town centre, city centre, or commercial area. Local businesses vote to establish a BID and, once approved, contribute a levy which is ring-fenced and spent exclusively within the BID area. BIDs give businesses a stronger collective voice, allowing them to shape projects and priorities that support local trade, increase footfall and spending, enhance marketing and promotion, improve the environment, reduce costs, support sustainability initiatives, and create valuable networking opportunities. They also act as a link between businesses, local councils, the police, and other public bodies to help deliver positive change for the area.
Facts About A BID
Business Improvement Districts (BIDs) are most commonly associated with town and city centres across the UK, but they are equally effective in industrial estates, commercial districts, tourism destinations, and mixed-use locations.
One of the key strengths of the BID model is its flexibility. Each BID is shaped by the needs and priorities of the businesses it represents, resulting in significant variation in size, structure, and scope.
A typical BID encompasses between 300 and 400 hereditaments (rateable properties), although some represent fewer than 50 businesses while others cover more than 1,000. Annual BID income generally ranges from £200,000 to £600,000, with smaller schemes operating on budgets of around £50,000 and the largest generating in excess of £2 million per year.
The legislative framework for BIDs was introduced through the Local Government Act 2003 in England and Wales, with supporting regulations following shortly afterwards. Scotland introduced its own BID legislation through the Planning etc. (Scotland) Act 2006.
The BID concept originated in North America during the 1960s and has since evolved into a globally recognised model for business-led regeneration and place management. Today, BIDs operate in countries around the world, helping businesses work collectively to improve trading environments, drive investment, and support local economic growth.
Developing a Business Improvement District
The development of a Business Improvement District (BID) is a structured process that places businesses at the centre of decision-making. While every BID is unique, successful BID development typically follows a series of key stages designed to ensure the proposed BID reflects the needs and priorities of the local business community.
1. Establish a Steering Group
The process usually begins with the formation of a representative steering group made up of local businesses, stakeholders, and, where appropriate, public sector partners. This group provides leadership throughout the development phase and helps shape the vision for the proposed BID.
2. Undertake a Feasibility Study
A feasibility study is carried out to assess whether there is sufficient business support for a BID. This typically involves surveys, interviews, workshops, and research to identify the key challenges, opportunities, and priorities within the proposed area. The study also helps determine the potential BID boundary, levy model, and projected budget.
3. Consult with Businesses
Extensive consultation is essential. Businesses must have the opportunity to influence the BID's priorities, projects, and services. Through ongoing engagement, the steering group gathers feedback and ensures the BID proposal is shaped by those who will ultimately fund and benefit from it.
4. Develop the Business Plan
Using the information gathered during consultation, a detailed BID Business Plan is prepared. This document outlines the BID's vision, objectives, proposed projects, budget, governance arrangements, performance measures, and levy structure. The Business Plan forms the basis of the BID ballot.
5. Ballot Preparation
Before a ballot can take place, the BID proposer must work closely with the local authority to meet the legislative requirements. This includes finalising the BID proposal, confirming the levy arrangements, and ensuring all eligible voters receive the necessary information about the BID.
6. Business Vote
A formal ballot is then held. Eligible ratepayers within the proposed BID area are given the opportunity to vote on whether the BID should be established. In England and Wales, a BID is successful when it achieves a majority vote both by number of votes cast and by rateable value. Similar legislative arrangements apply across the UK, with some regional variations.
7. BID Delivery
If the ballot is successful, the BID is formally established for a maximum term of five years. A BID company or delivery body is created to implement the Business Plan, manage the levy income, and deliver projects and services on behalf of levy-paying businesses. Performance is monitored throughout the term to ensure accountability and value for money.
Developing a BID requires collaboration, leadership, and meaningful engagement with businesses. When delivered effectively, the process creates a business-led organisation with a clear mandate to invest in the future of its area and drive positive economic change.
