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Should I stay or should I go......

Should I stay or should I go......

Hi,

Im currently working from home, but hating it, as clients turn up at all times! Also, I can't switch off

I have been offered an office today, offered because the surveyor I called about another office sugested an empty space to his landlord, a 600 sq ft office space at £ 525 a month, plus rates and bills.

It has more desks and cupboards than I need, but they will take away what I don't want...

Problem is, the additional cost is a little too much just now, but per my plan, should be okay in about 6 months. I would also need an office clerk, but with Govt funding could get this in my area for £ 60 per week for the first year.

Should I take the plunge...?

If I do, what else do I need to think about? I have a Ltd co set up bu not trading this yet, and not yet VAT reg, but would probably make these changes at the same time.

Hellppp....?

Murphy

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11th Jul 2011 20:37

From someone heading in the opposite direction

I moved out of my home/office decades ago when the kids arrived (twins) and am now looking forward to giving up the office this time next year and going back to working from home.

I've been spending hours and days at home over the past 6 months testing out how it feels and the work itself is so much easier than even a year ago with no paper files, all systems hosted in the Cloud and a serviced office that can double as a virtual office, but, and it's a big but, like you I find it hard to differentiate between work and home, especially as tending my growing vegetable patch or beating up the dog is always more exciting than a tax return or set of accounts.

Consequently, unless there's a business growth need that spurs you to get more space and staff, you will be paying hundreds of pounds a month for what is, at it's core, a psychological problem.

That probably doesn't help at all but take it from someone who has thrown away tens of thousands on unnecessary office space, utilities and bloody property managing (or not) agents over the years, try other ways of working from home before signing up for an office.

On the client visits front, that really is down to telling them that you only see clients during office hours and that they have to call to make an appointment.  Do you have a separate business line that can go on silent answerphone?

Good luck and if you do go for an office get a solicitor, who knows about them, to check out the lease or licence and make sure that the landlord confirms in writing that any deposit you pay is kept in a separate designated bank account, charge free from the landlord's own debts.

 

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By noradh
11th Jul 2011 20:38

More info needed!

What are the terms of the lease? Are rent reviews upward-only? Can you drop out at short notice and without penalty?

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11th Jul 2011 21:20

various

Why get rid of the extra desks, why not sublet them?

Get VAT registered if you are working predominately with VAT regsitered businesses as you will not be any more expensive to them and you can reclaim your own VAT paid.  If working for small non VAT registered businesses then think about the cost implication to them.

 

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By Monsoon
12th Jul 2011 10:27

Depends what you want...

If you plan to get premises and staff eventually, I would go for it. I'm not self disciplined enough to work from home, so jumped at the chance to sublet a small serviced office for £1000 a year.

I'm now in something 4x that with 3 staff.

They say you should get an office a bit bigger than you need to so you have room to expand. If you can afford it, I would take it, but obviously plenty of thought required too :)

I'd definitely second the idea of subletting desks! Make that space work for you while it's sitting dormant, I would!

As to the VAT registration, if the office is opted to tax, this may make your decision for you. I don't regret registering for VAT voluntarily and my non-VAT reg clients didn't mind too much - it didn't lose me any business.

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12th Jul 2011 10:31

Subletting

I can see the financial benefits, but I would be a bit cautious about sharing a work area with another business. What about client confidentiality? Does it have a meeting room where you can discuss things in private?

What about (worst scenario) the subletter is friendly with another (or their own) accountant and tips them off who your clients are?

Better, simpler, and safer, to find an office that suits you without needing a subletter.

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By GeeBee
12th Jul 2011 11:04

Slightly off topic, but.......

Do you find that working from home limits your income?

I wonder if clients think that working from home means you must be cheap, which reduces your income, but working from an office makes you more "official", and so you can charge more and therefore earn more, even though you have to pay out for the office. 

Just a thought from someone working from home. 

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By murphy1
12th Jul 2011 11:31

Yes Gee Bee...

Thanks for all your comments, they are really helpful.

 

The lease would be a year to year basis, as it is a Builder that owns the full unit, but has downsized substantially.

@GeeBee....My experience is that some people are okay with the home office situation, but they do expect me to be cheaper. Some potential clients I have been put in front of in my marketing campaign were almost at signing point, and have been put off when I say that I have a converted garage at home.....they think I am small, new and not for them.

I also think not being VAT registered aids this perspective.

My personal circumstance, three kids under 5 with the eldest starting school, make it difficult at home, albeit they are not here Mon - Fri from before 9 until 4, but equally, if I have an office, I will still need to drop them off pick them up etc, so will not be in there full hours until probably next year.

My business head knows the answer is to take the office, but be slow in reponding to them and negotiate them down...but unfortunately, my family side is the issue and money!

My partner doesn't want me to spend anymore and for us to get the benefit of the business growth at this stage, but they are not an accountant, or in business so doesn't really understand.

What about other costs outwith computers, networks staff, insurance....did you incur unexpected costs, and if so what were they?

Thanks again.

 

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By noradh
12th Jul 2011 11:56

Noise? Untidiness?

If you sublet desks, you may find that your tenants are noisy, or unpleasant in other ways. A friend is currently being driven crazy by a subtenant who uses his mobile non-stop and shouts at the top of his voice! The guy also works in perpetual disarray, with rubbish strewn all round the office.

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By Tosie
12th Jul 2011 14:31

three children under five

I would have thought it would be a dream job for a parent with young children to be able to work from home.

Offices have to be staffed what happens when the year runs out and you have to pay  a full salary plus office rent. I am afraid that at £60 a week you would have to be there with the person most of the time and that  brings its own problems.

If you do not have the financial committments of staff and rent you can turn jobs down if the children are unwell or nursery holidays.

I suspect that this is a question with no right answer.

 

 

 

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12th Jul 2011 14:32

Find another office?

Years and years ago I hunted high and low for a low cost office. I got one in a local businesslink converted factory, where the tenant next door was (quite legitimately) using high-strength glue which got right up my nose, the floors were concrete and the rooms dingy. I spent most of that time working at home, so realised it just wasn't for me and have worked from home ever since. I would probably be happy in a rather posh atmosphere if I were prepared to pay for such an upmarket office, but of course I just can't justify the expense!

You are in a very different situation and it sounds as if you do need to move to an office, but the one you are contemplating might not be the right one. In urban areas, there are lots of options to rent. Maybe there isn't much choice where you are. If I were you, I would keep looking for a block where you could start in a small room and move up as you grow, thus keeping the same address, but keeping the costs down when you need them to be low.

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By Monsoon
12th Jul 2011 14:58

Office overheads: a list

We pay:

Rent
Business rates
Electric
Water
Telephone line rental
Broadband connection
VoIP phone line
Mobile phone bill
Liability insurance (expect to pay ~£250)

Other costs for the office:

Furniture
Decorations (pictures on walls etc - looks bleak here without them)
Extra security (you may or may not need this)
Misc repairs
Redecoration
Kitchen/utility sundries

 

I think that covers most bases. Also remember a lot of commerical properties are empty at the mo so you may be able to negotiate the price down.

 

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By Top_Cat
12th Jul 2011 15:31

Too early to move ?

With 3 youngsters I would think working from home would be ideal.  Maybe once the kids are older then an office might work, but there are still school holidays etc to factor into the decision.

As for being cheaper - why? Charge clients what you think you are worth. If they dont want to pay then you're better off without them because however cheap you are that type will always haggle and usually be slow/non payers.

 

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By murphy1
12th Jul 2011 16:51

Home and kids...

...I thought it would be ideal to work from home, around the kids...ie. if I need to pick them up at 4pm, I do dinner, bath etc and start working again when my partner is home.

My real issue is I need help with my workload now, as I have a lot of new clients from my marketing campaign, which still has almost another 6 months to run, and therefore a lot more work to come in.

Also, I want to be able to take time off.. I don't seem able to leave the emails till a day or two down the line, or not return calls timeously.

Another Consultant has come back with a proposal for a 500ft office at £4,000 per year, which is just two minutes away from the first, and they have lots of empty office units - the office units are above retail/food units which all filled up as soon as the retail centre was available, but only 2 office units were filled. This is a bit better, but I would need to fit it out from the shell state and add furniture.....ooohhhh my head hurts.

 

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By bduncan
12th Jul 2011 17:00

I moved when my 3rd child came along

I was in a similar situation last year when my 3rd child arrived so that I had 3 under 5. I could not separate work from home and everytime I needed a coffee or the lou I was roped in to looking after one of the children whilst my wife dealt with the others. So I moved in to a serviced office it is small but it works well. I only pay £200pm plus electric, phone and internet so the it ends up about £4Kpa.

I am more productive and still get to go home (2 miles away) to play with the kids on a nice day. I divert the phone and the building has a receptionist so no additional staff are needed.

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