In essence, credit is a trust that allows businesses to trade with each other on…
There is a multitude of reasons to go for business relocation: Running out of space, worsened economic climate, a need for an upgrade, looking for new prospects, etc. Regardless of the rationale, know that there are many moving parts to keep an eye on. Weigh all the pros and cons, and pay special attention to financial matters, and how the moving impacts your bottom line. Relocating the business must not pose a hurdle on the way to success, but a stepping stone towards it.
If moving seems to be the best way to proceed, you have to make one key choice. Namely, compare the drawbacks and benefits of buying the real estate and renting, or leasing it. Those who decide to purchase are faced with higher upfront capital costs, but are also in a position to gain increased security, as well as capital appreciation opportunities. On the other hand, renting is a more frugal option, suitable for startups and those with a humble budget. Now, the math is not always as simple. Even if the monthly costs are low, once the lease expires, you may have to relocate again.
Beyond the upfront costs
Even if you are sure you will find better odds in the new place and capitalize on growth opportunities, there are other concerns to grasp. First and foremost, deliberate on all associated costs, not just the upfront ones. Living expenditures vary from place to place, going below and above the national average. Furthermore, the costs of buying or renting a facility fluctuate, and businessmen have to decide on the priorities like staying close to the target market, obtaining a better quality of life or finding more affordable premises.
The final decision must be based on thorough research, not gut instinct or urge to escape traffic jams. This is to say one must never focus only on obvious factors – like major costs – and fail to utilize economic development services, stay on top of potential environmental and regulatory red flags, and plan for a future expansion. Overlooking some crucial aspects undermines your financial projection and leads to complications in cost calculations. What is more, the business owners and managers must figure out what the business interruption will cost and how to ensure the smooth, seamless transition.
Time it right
Time is money, and the resource of the essence when relocating. However, part of the problem is that there is often no set time in which the relocation is supposed to happen. As a general rule of thumb, though, it is always better to avoid operating on a tight schedule. So, plan the necessary activities ahead and secure the best possible service providers. Seek the mobile storage solutions in your area and strike a good deal. Finally, make the most of planning by getting accurate information about the new location from the Chamber of Commerce, employment agencies or other business owners.
Understand the big picture and see whether you have some more prudent alternatives to moving. The change of place could be just the push you need in order to take the operations to the next level, but the same could be true for acquiring an adjoining space, splitting the premises in separate locations, taking advantage of the productivity hacks, etc. Take the example of taking an adjoining space: You can minimize the moving costs, mitigate the interruption risks, and retain all your loyal customers. This is the best demonstration that there is a wide array of efficient strategies for growing your business.
On the cutting edge
The grass on the other side of the fence may look greener, but do not jump over before doing the spadework. Moving carries multifarious risks, and some of the most common mistakes are moving in a hurry and trying to carry it out too cheaply. Moreover, the deliberation is tied to many factors: A labor market, living costs, upfront expenditures, long-term risks, possible alternatives, etc. Go down the path of relocation only if it makes perfect financial sense and gives you a mighty edge in the market.
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