If you have been thinking about building your own office or workshop, and would like to decide whether or not to embark on this big project, or simply rent somewhere or buy, you have your work cut out. There are simply so many things you have to consider, especially if you are looking to grow your venture in the future. Below you will find a few things you need to check before you jump in head first.
While financing is generally widely available for investments, and you can spread the cost of building your own offices or workshop, warehouse over a few years, you will still end up with a huge bill in the end. If you have the excess profits that will make it comfortable for you to invest in a long term asset, this can be a good way of planning long term. However, for a while, you will need to pay for your existing premises and the building project at the same time, so get your figures in order.
Long Term Asset Building
One of the main benefits of building your own business premises is that you will create something that will be valuable and potentially increase its worth over the next few years. However, you have to think about the location and the trends, as well as other aspects of the building. How much would it cost you to hire a rough terrain crane to get the groundwork done, or to obtain the land and the permissions?
If you are relying on renting your office, you will not be able to stick to the same area, and things will be pretty much out of your hands. You should fork out the cost of moving offices whenever your lease is up, or the rent is increased. It is crucial that you stay where your customers are, and don’t change your location every couple of years, due to unforeseen circumstances.
If you own your business premises, you will have more opportunities to brand your company and get it noticed by the local community and customers nearby. If you have a lease, your hands are pretty much tied, and you will find it hard to put your own mark on the venue and create an atmosphere that represents your vision and your values. That is why some business owners would rather buy or build their premises.
If there is one negative aspect of building your offices, it is the lack of flexibility. You will be tied to the same place, even if the market conditions change, and might need to find a buyer with similar profile and requirements to move on, which will be a challenge. You might not be able to expand or extend your building, and have to put up with the changing environment.
If you would like to build assets in your company, you should probably own your own premises. Whether or not you should get your office custom built depends on your budget and long term goals.