Finding an office space for your startup can be at once challenging, exciting, and stressful. Not only will this decision influence the way you work and engage with your team members for the foreseeable future, it will also impact your company’s bottom line; office expenses are, after all, one of the biggest line items you’ll have to worry about.
So what should be your biggest priorities when scouting locations for your business? And what oft-neglected factors should you keep in mind?
What to Consider
Make sure you consider these factors when looking for a place to start or house your business:
- The location. There’s a reason why “location, location, location” is the mantra of real estate agents everywhere. The location you choose has the power to radically change your business’s future. It’s going to dictate the costs of buying and maintaining the building, the customers you can attract, the partners you can work with, and even how far your employees will have to travel. Some businesses thrive best in dense urban environments, while others do better on the outskirts of the city. Consider your options carefully.
- Buying vs. leasing. There are advantages and disadvantages to both buying and leasing, so there’s no single “right” answer for your move. For many new entrepreneurs and small business owners, leasing is the better option, since you won’t have the cash reserves or financial flexibility to buy a building outright. However, buying can help you earn money through property appreciation, and gives you more flexibility.
- Move-in-ready vs. repairs. Next, you’ll need to consider whether your building is move-in ready or whether it requires some repairs and replacements. Generally, a building that’s move-in ready will cost more, but will save you time and make the process more streamlined. If you need to spend time or money committing repairs, it could delay your move and make things unnecessarily complicated.
- Your branding. Think about whether this space fits the concept you have for your brand’s identity. For example, if your brand is supposed to be open, inviting, and carefree, you’ll want to have an office with an open layout, colorful imagery, and a warm, inviting feel. If your brand is classy and intellectual, you’ll want an office that’s minimalistic, high-quality, and quiet. Customers and employees who walk in should get an immediate sense for what your brand is about, and how it’s different from other brands.
- Scalability and growth. If you’re in the early stages of business development, you’ll need to consider how this space will fit your needs for the foreseeable future; in other words, how will this space scale with your business? Ideally, you’ll want a space that can accommodate your current team along with your planned hires for the next couple of years (or longer). If you buy too much space, you’ll overpay in the early years and potentially overextend yourself. If you don’t buy enough space, you won’t have room to expand.
- You should also evaluate the level of flexibility your office can give you. Is this a place that allows you to make modifications? Are you able to adjust the terms of the lease easily? For example, you might consider whether you can sublet a portion of the office to another tenant. In some cases, the extra flexibility is worth a premium.
- Hidden costs. As you plan your budget, consider the hidden costs that might be associated with each office. It’s easy to work a rent or loan cost into your monthly budget, but what about the cost of utilities? How much will you need to spend to maintain your office with things like cleaning and repairs? Be sure you also consider the cost of parking, and the extra costs associated with transportation.
Getting Expert Advice
If you find yourself overwhelmed, or if you just want to make sure you’re making the right decision, it’s a good idea to get the advice of an expert. That expertise can come in many forms; for example, you might work with a real estate agent one on one to make sure you’re getting the best deal, and talk to a fellow entrepreneur or mentor to get their read on the situation. The more experts you talk to, and the more informed your opinion is, the better the decision you’ll ultimately make.