Tenant small business
As you get ready to rent space for your business, there are considerations to keep in mind.
As an entrepreneur, you're ready to expand your business from your kitchen table to its own storefront or warehouse. When looking at renting a space for your business, you'll want to consider what your needs are for space and location as well as how to pay for it and help protect it.
Rent a space for business
When considering a property, you'll want to look at a variety of options. This way you know what properties are available in your community and it'll give you an opportunity to consider what spaces will best fit with your business.
Location is the key consideration in looking to rent a space. Is your business dependent on customer foot traffic? Do you need to be in a centralized metro location, or convenient location at a strip center, or will you need signs to draw the customers to your business that's a bit off the beaten path?
Some other things to consider when looking at the location: Is it convenient for your customers, you and employees? Is the space near stores, banks, daycare and other important needs for your business, you and employees? What kinds of businesses and offices are in the nearby buildings?
When you are looking at spaces other "must haves" may include:
- Parking: Does the property meet the parking needs for your customers and employees?
- Build out and equipment: Are you looking for a furnished or semi-furnished space? Are you looking for an empty space that you can build out to your specific needs? Also, will you have 24/7 access to your business space?
- Utilities and internet: What are the options and costs for internet access and utilities?
- Facilities and staff amenities: Are the restrooms large enough to accommodate employees and customers? Will you need kitchen amenities for your team or when hosting meetings?
Determine where you are in your business model
As you look at your options for renting space for your business, this is a good time to evaluate where you are in your business model and consider updating or reviewing your business plan.
As you look at commercial space you'll need to balance the size of the space with your budget. If you are a new business owner or have been at this only a few years, you may want to consider smaller spaces that offer options to expand so you have room to grow.
Likewise, if you are in the middle or in the last few years of your business ownership, is the space flexible for you to downsize or — if you sell the business — for a new owner to expand?
Will you be able to reach your financial goals with the additional expense of the new location? If you are moving your business from your home to a new location, it can require as much planning and consideration as it did to start your business.
What is your budget?
As you look at expanding your business and renting a location for it, there are initial costs that may add up to a big expense.
In addition to planning for the cost of building out and furnishing your business' new space, you may need to add room in your budget for the day of the move and for basic operational supplies such as paper, pens and coffee.
Once you're in your new space, you'll not only need to meet the monthly expenses of rent and utilities, but you may need to consider personnel costs if your move includes adding employees.
Once you have found the space that works for you, ask about what the property owner requires from you before you sign the lease.
Some property owners will take care of maintaining the property, but depending on the lease, some of that falls to the tenant. You'll want to have a budget for those responsibilities.
Make sure you understand what is expected of you if you terminate the lease early, and know what your options are for renewing.
And you'll need help protecting all of your hard work. Property owners may only carry insurance to cover their investment in the building, but they may require you to insure portions of the building, any changes you made to the building, and your business property.
Consider the length of the lease or contract if you've had to make compromises on your "must haves"in your new business space.
Taking the step to rent a space for your business is a major milestone for any entrepreneur, so give yourself enough time to find the dream space when you can afford it and when it becomes available.