Should You Lease Or Own Office Space For Your Business?
When you don’t have a reliable base for business operations, it can be extremely difficult to attract investors, earn customer loyalty and hire top talent. That’s why many business owners realize early on that they cannot afford to wait too long before finding suitable premises.
Usually, they find themselves weighing the pros and cons of leasing office space and buying it. Figuring out arrangements for your office can seem overwhelming, but once you settle on something suitable, it should feel like a weight is lifted off your shoulders.
Viability of the Area
Be sure to consider whether your current location is a viable place to do business. Studying data about the economic trends in the area may help you determine what the future is likely to bring.
Furthermore, do research to evaluate the strength of your target market in that location. All communities have some faults, but if you find there are more downsides than advantages associated with your current business base, it’s probably better to plan on leasing office space for now.
Likelihood of Future Growth
Remember that the purchase of office space is probably one of the largest investments you will make associated with your company. Therefore, it is only one you should pursue if you can feel relatively certain about the size of premises you need.
You may be in a period of rapid growth where it seems like you are almost constantly hiring new team members and interacting with a customer base that grows larger by the week. In that situation, leasing office space is probably preferable to buying it, at least until things become more stable. It could be extremely frustrating if you find a property that seems perfect and end up buying it, only to realize soon thereafter it is much too small for your purposes.
Your Financial Resources
The amount of money you have to put towards your office space is another very important factor when it comes to deciding whether a purchase contract or lease agreement is more appropriate for you. In many cases, a property purchase requires a large down payment. If you are already lacking financial resources, that down payment may be too much for you to bear. However, if you are financially well off and have found a property you feel will be instrumental in helping your business thrive, the time may be right to make a purchase.
The factors above are some of the many things that must be carefully considered before deciding on office space. The more informed you are, the easier it is to reach a confident decision.