Estimated reading time: 5 mins
As your business venture grows and the number of people you employ rises, the time will eventually come to buy an office. You need somewhere central to conduct your operations and fully establish yourself in the market.
Unfortunately, it is at this juncture that a lot of newbie entrepreneurs can start making horrible mistakes, and it hurts them financially in the long-run.
In this post, we take a look at some of these errors so that you can avoid them when you finally come to buy your first office.
Mistake #1: Choosing A Cheap Location
There are office units available across many towns and cities, both in the centre and suburbs. But they’re not all equally valuable to your enterprise.
Newbie entrepreneurs will usually choose the cheapest locations that they can find, especially those located on the periphery of cities. However, these non-central locations come with a host of costs, including the fact that they’re difficult to get to.
There’s a reason why most large commercial office space is in the middle of cities: it’s right at the centre of the communication and transport network. Offices on the edge of town aren’t served as well by transport links, and usually much more difficult to get to.
Mistake #2: Renting Instead Of Buying
A lot of newbie entrepreneurs believe that the only financial option for moving into a new office is to rent it out and start paying high fees to a landlord. But it turns out that that’s a long way from being the only path you can take.
Experienced entrepreneurs now see the virtues of commercial mortgages. Unlike renting, they actually own the buildings in which they operate, which gives them the freedom to adjust them how they like. In addition, they can sublet them to other firms, helping to contribute towards mortgage payments if they have enough space.
Don’t underestimate the convenience and flexibility of buying instead of renting. You have far more control. And nobody is trying to lock you into multi-year contracts that work against the interest of your business.
Mistake #3: Failing To Do Adequate Research
You might think that all offices are the same, but it turns out that there are substantial differences between them. While the vast majority come with the basics, such as kitchens and bathrooms, there are many other features you need to consider.
For instance, are you planning on keeping high-value servers on-site? If so, then you’ll need a secure room with proper air conditioning that can keep them secure and at the right temperature.
What about if you plan on hotdesking? In that case, you’ll need an office with a structured cabling solution in place.
If you’re planning on buying your commercial property outright, be sure that you do proper research into the future expected values of properties in the area. Remember, not all office districts are up-and-coming. Some are in decline.
Mistake #4: Failing To Set A Budget
The quality of offices varies considerably from building to building. Some vendors set them up for inexpensive operations, such as call centres, while others spare no expense on fixtures and fittings.
The type of office you choose depends very much on the kind of work that you do. If you’re running a call centre operation, the quality of the surroundings probably doesn’t matter all that much. However, if you plan on entertaining clients at your offices, the quality of the interiors counts a lot.
Mistake #5: Ignoring The Needs Of Your Employees
As a business owner, you have a very specific set of objectives. Your goal is to get the costs of your business as low as possible so that you can make as high a profit as possible.
Unfortunately, your staff usually have different ideas. They want to go to work in a pleasant environment.
While ignoring the needs of your employees can seem like a great strategy in the short-term, it’ll come back to bite you in the long-run. Over time, employees will leave your company, looking for better places to work. And eventually, you can experience a kind of “brain drain.”
It goes without saying that avoiding this should be a top priority.
When scouting the market for office space, think about the specific needs and expectations of your employees. Think about how they will react to the prospect of working in any particular environment.
If you have a small team, also spend some time considering their individual needs. Do some people work best if they have exposure to natural light? Do you need a gym onsite for fitness fanatics? All these questions should enter your mind before you sign any deal.
Mistake #6: Thinking With Your Heart, Not Your Head
Some commercial properties are stunning. Offices in central locations housed inside skyscrapers offer stunning views of their surroundings, providing the employees inside with a unique working experience. The romance of these office spaces can sometimes overwhelm you and you wonder what it would be like to work in one of them.
If you can, try to avoid this type of thinking. Running a business from a spectacular location feels great, but economically, it can be a disaster. Prices are often astronomical.
When buying commercial property, always think with your head, not your heart. Carefully consider the actual features that you need, not the ones that you’d like to have if money were no object.
Mistake #7: Failing To Sub-Let
As a commercial enterprise, you need to make the best possible use of resources at your disposal. And that includes any offices that you decide to buy or rent.
If you know that you’re not going to use a wing of your office, don’t leave it idle. Instead, continue lowering the price until you capture the attention of potential commercial tenants. Then use the money they pay you to contribute to your business’s bottom line.
Making mistakes is part and parcel of being an entrepreneur. But they’re mostly avoidable when buying commercial property. Don’t rush into any decisions. Take your time and find the best setup for your enterprise.