Life has many important firsts: first steps, first words, first kiss, first series A funding round. For start-ups, one of the biggest is the first office. But how do you know if your start-up is ready to make that office move? Growth is crucial for any start-up, but growing too fast can be disastrous. Office space is likely to be one of the largest overheads of your business, so you don’t want to rush into it. What factors do you need to consider? And once you’ve decided to move, what are your options?
Should I stay or should I go?
Ultimately, your business needs should dictate whether or not you move. Remove emotion from the decision-making process so you’re only left with the facts, and can consider all the factors involved.
Future changes
Start-ups change much faster than established businesses, growing or downsizing rapidly, so your space needs could be very different in a few years. You don’t want your office space to restrict future opportunity . Will the type of office you can afford now attract the right kind of talent and clients in the years to come? Is selling your company within the lease term a possibility? All of these future options should be considered now.
Client impact
If your business requires frequent client visits, having a professional office space could improve your reputation. Some clients might respect the scrappiness of a home office or constant coffee shop meetings, but others might be less impressed. An attractive office attracts better clients.
Productivity levels
If you’re having difficulty getting enough done in your current space, the space itself could be the issue. Working from home presents many distractions – flatmates, Netflix, a comfy bed. Moving into a dedicated work space could reduce procrastination and boost productivity.
Number of employees
Running a start-up with a couple mates may not require office space. Once you hire more people from outside of your inner circle, however, an office space can help provide a sense of stability and attract more qualified employees.
Costs
There are numerous costs associated with moving into an office and not all of them are obvious. One-time costs include hiring movers and purchasing furniture, while ongoing costs include rent, utilities and maintenance services. Certain office leases will require proof of financial responsibility if rent goes unpaid, which is a large financial commitment . Commuting costs have to be considered as well; no more rolling over in bed and getting to work. You also need to consider the future rental costs in that area. It might be cheap to rent there now, but is a new transport link or commercial development going to significantly increase rent in the next few years ?
Commitment
Many commercial landlords prefer five to seven year leases. As a small company, you don’t want to be locked into a lease that’s too long and doesn’t provide any flexibility. Exploring options like subleases could help, but if you can’t commit to a space for any length of time, you might not be ready for an office.
Conventional, serviced & managed – what’s the difference?
If you’ve decided your start-up is ready to move to an office, the next question is – what kind of office do you need?
Conventional offices
Conventional office space is what you may be most familiar with – an office with a minimum lease term of five years (sometimes with a three year break clause). The space can be tailored to the company’s preferences, giving them total control over branding, design, furnishing, telecoms and more . Acquiring a conventional lease generally takes eight to twelve weeks to complete. A conventional lease is right for you if your business:
- can commit to a long-term lease
- has no imminent growth plans
- has time to complete the acquisition process
- needs control over the layout and design of the space
Serviced offices
Serviced offices provide all-inclusive, fully furnished spaces with amenities included in the rent and usually offer flexible, short-term licence agreements .Serviced offices can also be shared offices where different start-ups and freelancers work in the same space, sharing common amenities. A serviced office is right for you if your business:
- needs flexibility with the agreement length
- plans to grow quickly or is unsure about future staffing requirements
- requires an immediate move-in date
- wants to limit upfront costs
- doesn’t need control over the space’s design or layout
- values convenience over customisation
Managed offices
Managed offices bridge the gap between serviced offices and conventional leases. They are vacant spaces that are not necessarily designed to be offices, but are rented out as office space. Most managed offices offer basic amenities like workstation partitions and utilities, but do not offer reception services, furniture, telecoms etc . A managed office is right for you if your business:
- doesn’t need all the facilities of a serviced office
- wants a flexible lease agreement
- is unsure about future staffing requirements
- can provide furniture, equipment and telecoms set-up
- wants to customise the space’s design and layout
Storage King specialises in providing businesses with business storage and managed offices solutions. Visit https://www.storageking.co.uk/ for more information. Image courtesy of Tobias Mikkelesen