The right location can be critical for attracting customers and employees, while the premises
themselves can influence productivity. You also need to take into account how the decision to
license, lease or buy your premises affects your costs and the flexibility you have to react to
future changes in your premises requirements. You also need to know where to look for your
small business office space, or a multi-story commercial warehouse.
Know your limits
Keep your premises as small as you can, however do keep in mind your future needs as well,
because you may be committing for a long period. A low-cost and low-risk option for
entrepreneurs and small companies is shared business space. This could be a place specially
designed for sharing, or could mean taking accommodation alongside another small company
in order to share the costs. Rather than taking a big place from the start, it’s far better to try to
find a small office or unit, with a view to upgrading once you’re more established.
— A Product Place (@A_Creative_Spot) March 8, 2017
If your business is a retail outfit for example, you may find a town centre location with high
footfall. Or if you don’t need high street presence, you may be able to save costs by being
outside the centre of town. Take into consideration you may have a high volume of goods
delivered or collected, so easy access and suitable loading facilities will be a high priority. Also
how closely you may be to your customers and how this will effect your business. There are a
lot of questions you need to ask yourself when considering the location:
What are the transport links like?
How will the area effect your business image?
What are the neighbours like?
What will your customers think when they visit you?
Specifics of a property
Finding the right place for your starting premises is one of the most important decisions you
will make. This will depend on the type of business, make sure to think hard about this and
draw up a list of requirements you need.
You cannot predict exactly how your business will grow or how the economy will sustain. If
you’re thinking of taking on staff in a year’s time, you should wait until then for a bigger office.
Or if you think you need another room to deal with your clients, have a think of the usage and
the expense of an additional room specifically for meetings in your office. There may be a cost
effective alternative like finding a nearby business centre or hotel that hires out meeting spaces.
However don’t be tempted to leap into the cheapest property you can possibly find. Check the
conditions, if it’s damp, dark or in a poor location, it will not be a great environment in which to
work. This could result in decreased productivity, reduced ability to hire good staff and create a
poor impression on visitors.
Thinking of starting or buying a business? You may also be considering leasing premises. We offer a commercial tenancy…
How much will it cost?
Look carefully at what’s included in the price. If it includes business rates, utility bills and cleaning,
or if it includes some business support. If it doesn’t, these items can add up so make sure you know
what you’re taking on. Try to put together a budget with estimated costs for all your outgoings
including property expenses, staff costs, marketing, telephone and internet charges. Before
committing to any premises, see if your projected income can cover all these items, including some
leeway in case you lose customers or people fail to pay on time. When comparing the cost of a range
of property options, make sure you are comparing with all of these options included.
A lease or a licence?
These are the two main types of legal agreement between a property owner or manager and the
occupier which you are likely to encounter.
Licence agreements are more flexible than leases and are better suited to small, growing firms
with frequently changing needs. They don’t tie you into long contracts, are quicker to sort out
and normally incur few or no legal fees.
However, they don’t give you the same accommodation rights that leases do and, on a licence,
a landlord could serve you notice on the same short term basis as you could. Leases require a
much long-term commitment from occupiers, typically 10, 15 or 25 years, although there are
now some shorter leases around. On the up-side, leases also mean agreed rents and provide
more ‘security of tenure,’ giving you a right to renew your lease at the end of its term.
Where to look?
Depending on the type of property you’re after, there are a number of places to look. Searching
online will bring up a range of office brokers. If you see somewhere you like, you can ask the
broker to put you in touch with the property manager.
Take note that the broker will charge the property manager if you take space in the building,
so another option is to run internet searches to find the property directly. This may give you
more chance of being able to negotiate a favourable rent, perhaps a reduced cost for the first
couple of months, as the manager won’t be paying the broker a fee.
Commercial property agents can help you to find your property, and often provide a range
of services alongside, including handing lease negotiations on your behalf. They will also
have a good knowledge of rent levels in the area are and how much you should be paying
for any given property.
Mainstream estate agents may also advertise commercial premises. Keep a keen eye on
commercial premises advertised in the local media and, finally, don’t forget to use your
network of business contacts. You can also ask friends and associates to let you know if
they hear of anything. Personal recommendations are often the best way to find premises
and, in the case of shared buildings, business centres and serviced offices, usually mean
you get an honest view from someone who has worked there themselves.