Starting a Business: finding premises
Small businesses need small premises these can be hard to find. Premises are usually the second highest cost after staff wages, so it is vital to find the right place to work. The key points to note are location, cost, size, and layout as well as in some cases whether to rent or buy.
Working from home
This is an easy and cost effective way for businesses to start. Working from home can be ideal for a number of service businesses, particularly those that are computer based. If you go to others’ premises to supply your work- if you are a consultant or decorator, for example- it easy to work from home since you will only need your office for administration purposes.
Finding outside premises
There is seldom one organization that lists all the commercial properties available to buy or rent in an area, so you need to consult a number of sources including:
- Your local business advice center
- The local industry development authority
- Commercial property advertisements in the local newspapers
- Estate agents specializing in commercial property
Some points to remember when taking on premises
- Avoid being in too much of a rush. This is one of the most important start up decisions that you will make
- Do not even consider taking a property in a poor location
- Do your sums properly and make sure that you are in the budget that you have set
- Think about the layout of the workplace to avoid taking on somewhere with unsalable or wasted space
- Be realistic about the size and timescale of possible expansion
- Read the small print in the lease and take professional advice
- All terms of the lease may be open to negotiation, including the length of lease, and sometimes common charges.
- Get advice from insurers and quotes for security, and work them into the equation – these can often be surprisingly expensive
The lease – if you are going to rent a property, read the lease very carefully. It will cover the period of lease, the rent, all responsibilities – including those for insuring and repairing the premises (normally upto the tenant)
Finding office space – suitable small office premises can be difficult to locate, though blocks converted into managed units sometimes offer small offices with shared facilities, such as a kitchen or photocopiers.
Finding retail space – The retail trade is subject to continuing change. Many of the chain stores have great financial and marketing strength; new shopping complexes are shifting the retail centers of towns sometimes out of the town centers altogether, offices are encroaching on previously completely retail sites, shopping is becoming more of a family leisure activity and there is a growth of Internet shopping.
Cafes, restaurants and bars – As with shops location is crucial. Whereas a fast food outlet requires a prime high street location, a good restaurant or bar can afford to be elsewhere, but not just anywhere. A key factor is grouping; if there are already bars or restaurants in the street and they appear to be doing well then this is a good indicator.
Workshops and small industrial units – There are new and refurbished units widely available, but in a few areas there may be a a shortage of the most popular units. Landlords come from the private sector and the government. You may be able to extract more concessions from government landlords, but do not expect to pay too much less than privately owned units.
Small hotels or guest houses – Choosing the location of a hotel will depends to a great extent the type of clientele that you expect to attract – mainly tourists or people on business. To attract mainly overnight bed and breakfast visitors you need to be in a highly visible location on a road carrying suitable traffic.
Equipping your workplace
For many people, the selection of equipment for their new business is both challenging and exciting. There is a real sense of progress being made and the dreams becoming a reality. However it is important not to become so focused on this aspect of starting your business that you neglect other more important aspects.
Alternatives to consider – the first thing to think about is whether you can get about without the equipment. Are there alternative ways of working that make the purchase of equipment unnecessary? Would it be cost effective to pay someone else to do the work that would require extra machinery. Maybe you can decide to put off the purchase of the machinery for a while. This will help your cash flow and help establish whether you really need the item.
Features – when choosing equipment such as a computer, cash register or piece of machinery, there is usually a wide variety of models available, ranging from the basic to the top of the range. You need to be clear about what features are essential for your business.
Financial considerations – The real price of any piece of equipment is not simply the purchase price, but must also take into account the equipments depreciation and running cost. For simplicity, even if you disregard the depreciation you ought to consider the running costs as they can vary enormously between rival products.
Warranty and support – All equipment breaks down at some time and it usually seems to occur at the most critical moment. So you need to know what is covered by the warranty, for how long a period of time, how prompt the service back up will be, and the cost.
Used equipment – Generally second hand business equipment has very little resale value, which is precisely why the smart entrepreneur should be able to pick up some bargains. In particular office furniture- such as desks, chairs and filing cabinets – can be bought from suitable auctions for a fraction of their value when new.
Equipping an office
Whether your office is at home, in commercial premises or at the back of a shop, one of your first requirements will be furniture. You will probably need a large table or desk (tables are considerably cheaper) adjustable chair, some shelving or cupboards and possibly a filing cabinet. Note that filing cabinets when full are very heavy so make sure that the floor is able to support the extra weight.
Computers When buying a computer do plenty of research first. Ask computer users you know and shop around and compare advice given about specification you need for your business. For general use, the choice of software is usually more important than the choice of hardware. Think carefully about the type of functions you need the software to perform (word processing and accounting for an example) then compare the applications available in terms of features, ease of use, and price. There are some office sets of software available that combine all the basic office functions in a bundle. If there are programs that are standard in the field in which you work, this will probably dictate your choice.
Telecom equipment range from basic phones with an answering facility to complex switchboard, and prices vary accordingly. Many systems can be adapted to your precise requirements. Make several enquiries with firms to compare the deals on offer and compare installation costs, standing charges and call charges; this is a very competitive market. You should also consider how many lines you will need.
Security Do not forget the physical security of your office, since expensive equipment attracts thieves. You need to make arrangements to keep back up copies of critical computer files at a separate location and if you have to keep critical documents you should consider keeping them in a fire proof security box.If you are looking after valuable items in transit, you may need to obtain specialist, flexible insurance that covers them while they are in your care.
Equipping an shop
Equipping a shop requires specialist retail and shop fitting knowledge. If you are new to retailing this is the stage at which you seek and employ professional help. Retailing is a highly competitive business and customers expect high standards of design and layout. You may be setting up a modest enterprise but your customers will not wish to experience an amateur effort.
Layout and display The shop layout is the starting point. The design needs to allow for a natural flow of people around the shop so that they can enter and move easily to see everything on display, make a purchase, and leave all without any difficulty. Access should be good to all parts of the store. Note that customers may be reluctant to go to upper floors even if there are lifts or escalators.
Exterior aspects The overall image that a shop projects sends an important signal to a potential customer and as a result of that image, they may not choose to enter. Seeking professional advice is not simply about getting ‘the shop to look good’ but making it actually work and be a viable business.
Equipping a workshop or small industrial unit
When you are buying equipment for an industrial unit, the key factors that you must consider are;
- Storage of raw materials
- workflow
- Storage of completed goods
- Regulations
- Security
Storage can be a bigger problem than many anticipate, and the need here is to have ease of delivery coupled with ease of access for production. Most goods travel around the country loaded on pallets, though small quantities are usually packed in cartons. Your goods inwards area may require some form of pallet handling, although the alternative is to break the pallet down.
In terms of workflow, the choice of equipment and its precise placement in the unit should be to facilitate efficient production and to establish a safe working environment. Compliance with the many safety regulations is essential and unless you have experience in this field it is vital to get professional advice.