Five Steps for Startups Making the Transition to Renting Office Space
You started off in the basement of your house, but your one-man show turned into something more. Congratulations! The need for office space is a good sign that your business is experiencing growth. Which often means hiring new employees, or more employees, depending on your situation.
Leases and accompanying security deposits are expensive and can take a hefty bite out of profits. So here are 5 steps that will keep you mindful of what’s important as you take that leap.
1. Assess what you need.
Consider why you are making this move. Is it because you need more space for an increase in staff? Or to provide a space for clients to visit? Depending on your primary focus, your search parameters will change. According to Entreprenur.com, you need about 124 square feet per employee in your office. Do the math and list up your needs and wants too. While you do not want to bite off more than you can chew, articulating what you want can help you hone in on it when it appears. Create a wish list that you can print out and bring with you as you visit each potential property.
2. Decide on your budget.
Get your financials in order. Have a meeting with your accountant to determine how much you can allot to your office space without hurting your bottom line. Do not forget that offices need furnishing. And there is a host of related expenses that go into getting an office fully functional. Make sure to account for all the little expenses of moving as you calculate your budget. You will also need to be able to show tax returns for your business or bank statements that can attest to your solvency. Have your accountant prepare these papers so that they are ready when needed.
3. Research location.
As you visit properties, don’t only think about the building itself, but also consider the location. Is it close enough to make it an easy commute for you and your team? Is parking space available either onsite or reasonably nearby? Can your primary clientele reach you easily? And while this is not a make or break element, being located close to coffee shops and restaurants is a nice plus. If you have two properties that each hit many of the same key elements, then choose the one that is close to amenities that you appreciate.
4. Understand your lease’s fine print.
There are a couple ways commercial leases differ from residential leases, and it is important to know the difference. First, there are no standard forms and fewer laws that protect you. Commercial leases rely on negotiation between business owners and landlords to flesh out the fine print. For example, who maintains and pays for improvements on the property. Who pays for utilities, etc. Make sure to also look at the total amount you would be paying per month, and whether that includes tax and property insurance. According to Forbes.com, entrepreneurs most commonly sign a full service gross or modified gross lease. This type of lease consists of splitting repairs and operating expenses between landlord and tenant.
5. Hire a respectable office furniture installation company.
They say that the devil’s in the details. And no more so is this true than when your office set up is at stake. Precious dollars can go down the drain by trying to repair faulty office installation problems. Do not cut costs when it comes to setting up your office. Investing in professional movers will save your sanity in the long run. Companies like www.precisionco.com provide moving services, as well as office space planning and sourcing.
Making the leap to renting office space is a move that you will want to research and plan carefully. Taking the time to do so will pay off in a smooth transition and a good start to your first office space as a startup.
Photo by Bike Rider London | Shutterstock
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