Increasing your company’s requires additional office space? Another strategy to boost your self-esteem, perhaps. More and more Luxembourgers are taking the plunge and starting their own businesses, and it’s a phenomenon that’s becoming widespread in the country.
The majority of these entrepreneurs operate from home, in cafés, co-working spaces, cellars and garages. In order to establish the legitimacy and authenticity of their business, other entrepreneurs take the leap and buy or rent commercial space.
Is this a wise choice when launching a new business? The answer may be “no.” So, if you’re considering leasing a private office, hold back your enthusiasm and ask yourself these five questions first.
How much does it cost to have an office space?
The monthly cost per square foot is the most important metric to consider when renting office space. For a private office, this is the minimum monthly payment you will need to make.
However, there are additional expenses to consider, such as insurance for your business property, liability insurance, supplies, gadgets, furniture and decor, and utilities (internet, electricity, water, garbage pickup, alarm service, etc.)
To maintain a good profit margin on your product or service, consider all overhead costs associated with renting private offices. For those planning to raise additional funds in the near future, this is extremely important.
What are your future growth projections?
Renting a private office for anywhere from three to six months to several years is common in this type of business (three to five years). This can have a negative impact on the image of the property if businesses are in and out frequently.
When looking for private office space, consider the anticipated growth of your business. Your company’s growth may come in fits and starts or it may be explosive in the early days. With or without a merger, your business is sure to grow.
Consider your projections when determining the size of private offices you will need. You don’t want to be tied to a long-term commercial lease that limits your ability to expand.
What value or income can be generated by leasing a private office?
An expense that does not contribute to generating revenue is usually unnecessary. Is your business model suited to a private office space? Will you be able to increase the efficiency of your startup’s workflow, your team’s dynamics, or the overall customer experience? Ask yourself if you really need a commercial office at this stage of your startup’s life cycle.
Do you value confidentiality and secrecy in the workplace?
Confidentiality is a requirement for any business. You take care of customer data, phone calls and personal information of your employees, among other things.
Meetings in an office can be more private, which makes clients more comfortable than meetings in a public place.
In addition, offices can protect your paper and electronic data from outside tampering, theft or loss. A less private location, such as a shared office or coworking space, may be an option if security is not a major concern for your practice.
How will your current workflow be affected by the new office space?
Moving into a private office and bringing your team in-house will change the dynamics of collaboration between your team members. Every aspect of an organization’s day-to-day operations will change as a result of this transition.
But that’s not always a bad thing. When you eventually get all your employees under one roof, you will reap the benefits. However, you need to consider the influence that moving to an office space will have on your business.
You will benefit from the change because it forces everyone to work closely together, which reduces the number of hiccups and mistakes during the startup process.
A private office space is essential, but you also need to think about how finding a new place to work will affect your productivity and success. Don’t approach this process as a search for your ideal home. When making a decision, ask yourself what you need to function and thrive, then choose.