It’s a really nice impression to have a posh, shiny office, but not all start ups are created equal.
When you’re doing your business plan, especially a start up, this is a major question for many – should you start up at home, or include that shiny, polished office in the start up funding?
If you’re a start up, do you need that shiny office space?
If you have the capital, and it’s the sort of business which will require an office, then by all means, include it, but you need to also include six to eight months of rental costs (if it’s not your building), utilities and any other costs related to the office space. You may also need a secretary to take calls at your office line(s) and tend to people who walk in for information. You will also need to factor in signage, and other ways to let people know that you’re open for business. You’ll need to get someone to clean the office, vacuum carpets, and keep everything pristine. Plus, you’ll be in a lot of debt if you need to take a business loan for your startup.
If however, you don’t have the capital, or it is not the type of business that requires an office immediately, then a home office is not such a bad thing, especially if you’re jumping into your business and leaving the working world behind. Home offices have many perks: you don’t have to go far for lunch, if you’re the only employee you don’t have to get dressed up for work (please shower, not showering is just gross), you can work where you please, and best of all, no traffic to get to work.
Your work schedule changes when you start a business; you go from an 8-to-4 grind, to a 12-to-16 hour day and 7 day work week. Working at home always makes long hours easier, however, it also poses many distractions, like the television, fridge, neighbours, etc. You have to have the discipline to work at home.
Businesses who need an office space have walk-in customers, are selling a product or service, and have too many members of staff for a home office. Businesses who are one-man-shows and are service-based don’t always require a space, unless you require entertaining clients regularly at your office. If it’s off and on, you can rent a conference room, or go to a coffee shop (some Rituals locations are a bit loud, so careful where you meet), or even a hotel lobby.
Small product based start ups can be run from home on a small scale, and as the business grows, you will afford that space you’ve been looking for. By then, you also would have built up a customer base, who would then visit your shop.
All in all, it comes down to whether you need it and if you have the money for it.
Is it necessary to put yourself in that much debt for an office space? If you need it, plan it properly and set out enough funds just in case your start up does not pick up as fast as you projected.
If you don’t need it, saving money is always a great thing when it comes to start ups. Many multi-billion dollar businesses started up in someone’s garage or basement, and they were able to feel more of the profits because their expenditure was much lower. But the decision lies in your hands…
