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Find the right office set-up for your firm

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By Jason Harris-Cohen, founder, Open Property Group

Finding the right office space that is appropriate for the anticipated future of your small but fast-growing company can be a very lengthy and costly process. The following tips will help you through the process:

Find the right location

There are a number of factors to take into account including planned infrastructure and investment into an area, how convenient it is for your employees and visitors to get to the office, where the local amenities are and whether there are any competitors close by.


Having too many competitors within a close proximity may have a negative impact on your business, especially if they've been there for a while and are well known for having a good reputation (which could indicate brand loyalty among local folk).

Being close to universities also gives you access to a continuous talent pipeline; you may wish to forge relationships with them as your company grows and requires more staff. 

Check the demographics

It’s crucial to carefully scope out the demographics of your chosen area. If you’re a children’s clothes shop, for example, the physical location of the store is extremely important – it wouldn’t make sense to rent or purchase a store in the middle of a rural village, where the residents are predominantly of retirement age. 

Once you have gained deeper insights into who your target audience is, and observed their gender, age, income and interests, you are much more likely to be in a better position to actively determine where to start up. 

Calculating business rates

Equivalent to people paying their council tax, businesses also have to pay a tax based on their property’s ‘rateable value’. Rather than waiting for a bill around April, and to help forecast costs within your small business, this UK business rate calculator (https://www.gov.uk/correct-your-business-rates) can estimate the likely payable costs, as they usually alter from year to year.

Some properties will be eligible for discounts from their local council through a ‘business rates relief’. There are a number of different types available, including a small business rate relief, and a relief for pubs (which enables the owner to pay £1,000 less if they have a pub in England with a rateable value of less than £100,000). 

Buying, leasing or license

Commercial property is a big financial consideration. If you can’t afford to buy your own office outright then you may choose to lease or license. These two terms can often be misconstrued.

Licensing is a short-term option, allowing the occupation of space for the agreed activity for a duration of time, whether that be a couple of months or years. 

Advantages:
● Flexibility to move in and out with short periods of notice
● Marginal legal fees, usually just a low deposit

Disadvantages:
● Minimum security as a business as landlords can also administer notices
● Limited leeway in altering the business space to suit your needs

Leasing commits you to a space for a specific period, usually beneficial for more established businesses.


Advantages:
● Can make alterations (with the landlord’s approval) to benefit your business activities
● The landlord is generally responsible for office maintenance and repairs

Disadvantages:
● The lessee could be liable for the entire lease period, even if evacuating earlier than agreed
● No ownership at the end of the leasing period

Planning for future growth

Co-working spaces are especially popular with start-ups and small businesses, not only because they’re seen as a more affordable option, but because they encourage a sense of community, creativity and innovation, with entrepreneurs able to network and build long-lasting relationships with similarly-minded founders.

If you’re thinking of moving into a co-working space, make sure it works with your projected growth plans. How many staff do you envisage taking on over the next few years? Will the co-working space still work for you then? If you’re likely to outgrow it, is there an option to take on another, or bigger, unit within the same building? Equally, while it’s great to be ambitious, there’s nothing worse than ‘biting off more than you can chew’ by committing to a lease for a property which is far too big for your business.