How to Relocate Your Business
There comes a time when a business owner realizes a need for relocating his or her business. When a business grows, a change of place seems like a natural step towards a more promising path to growth. The number of employees slowly increases, and one hopes to find better working conditions and chances for further business success than they had in the previous business premises. Why location matters? What are all the possible costs of moving a business? How to make the first move? In this article, the best possible solutions are explored and presented, so you would know what to expect if you decide to relocate your business.
The most common reasons for relocating a business are: the desire for business expansion, considerations about quality of life, work force and labor issues, the need to upgrade equipment or facilities. The importance of these concerns vary for different businesses and at different times. The need for the right work force is chief among all the reasons. If a company is in need of workers with specific technical expertise, it is worth relocating to a place where those kind of employees are easy to find. Also, small businesses start in smaller facilities, and relocating is a must when the facilities become undersized or outmoded.
Issues Regarding Relocation Costs
Entrepreneurs have to compromise between choosing the lowest-cost facility and staying close to target markets. Moving can create or solve various cost-related issues (theoretically speaking), because the cost of living is different in the suburbs and big cities. This resulted in people moving from cities to nearby suburbs. Large companies that seek to build plants or semiconductor factories are known to lend billions-dollar-worth tax concessions that are well-publicized. The incentives are based on the number of jobs that their business will create, so they rarely receive such perks. By selling land or buildings appreciated in value, entrepreneurs can boost their cash flow, and then rent a lower-cost space. Companies today also look at education facilities, health care, recreational opportunities, crime rates and other factors when evaluating relocation.
Moving to a new location (knowing all the setbacks of your current location as well as the advantages of the new one), it can be one of the best things you can do for your company. However, there are no guarantees for improvement, because there are many unfamiliar factors that can go wrong: focusing too narrowly on several costs, rushing the decision, ignoring factors concerning the quality of life, and failing to plan future expansion. One must take all factors into consideration, from costs of purchasing/renting new space to renovation.
Leasing And Expanding Without Moving
The basic difference between buying and renting a business space is in upfront capital investment, which is larger in case you plan to purchase a facility. At the same time, it provides the opportunity for capital appreciation and security. On the other hand, it costs less and is easier to get out when leasing a space, but monthly payments might be higher. Making a personal purchase and then leasing the space to your own business is one of the options.
Another solution is expanding by acquiring some adjoining space – the interruption is minimal, you save on moving costs, and your old customers will not have trouble finding you because you will remain in the same place. Also, consider splitting your business operation into more locations by moving your manufacturing or warehousing to another facility.
How To Make The Move?
Write a detailed specification about what the new location has to offer. It is determined by the main reasons for moving. If it is a better labor market, for example, then you should pay attention not to get distracted by incentives or a favourable lease in locations where the work force is not well-qualified. Visit all the sites on your list and get complete information about new locations by subscribing to magazines and newspapers in locations you are considering, economic development agencies, employment agencies, and utility companies.
When you decide to move, assign the job of relocating the business to someone skillful and trustful. Relocating a business is not always a good decision, but if the new location addresses your needs better than the previous one, then you should do whatever you can to provide better conditions for the future growth of your business.