How to Develop a Business Premise for Your Small Business


If you are dealing with products, as opposed to services, you will often need to rent premises in which to work. Premises available can range from small workshops of no more than 500 sq ft (50 sq m) to small factories, depending on requirements. It is unusual for someone starting out in business to need a large factory straight away, but it is possible.

A warehouse is normally used for storage purposes only -storage of materials before processing, storage of deliveries ready for despatch or storage if you are the middle person between the seller and the buyer.

Develop Small Business

Size

The size depends on what you are producing, the size of the machinery or equipment you use and the amount of space needed for immediate storage of materials, packaging, wrapping and the finished product ready for despatch. It is sometimes more cost-effective to rent a slightly larger workshop which will accommodate all these requirements comfortably than to rent a separate storage area or warehouse.

When calculating the size required, remember to allow adequate space for the people who are going to work there, for facilities for those people (personal belongings storage, refreshments and so on) and for a certain amount of office space. Even if you are doing the books elsewhere (at home, for example) you will need a space on site for processing paperwork; this space will need to house a PC. You will certainly need somewhere to put the phone.

Access

You need easy access to your premises for:

  • yourself
  • your staff
  • deliveries
  • despatch

Make sure that you can get in to your premises when you want to – 24 hours if necessary. Make sure that your staff can get in if you are not there for any reason.

Consider access for large delivery vehicles, particularly if you buy in bulk. What unloading facilities are there?

Is there adequate parking for you, your staff and your own vehicle(s) for despatching goods? What are the loading facilities for your own vehicles? Are lifts available if necessary?

Try making a list of all the people and products which will be going in and out of the premises and check for each whether they can get in and out in a cost-effective and practical way.

Security

What security measures are in force to protect the premises you are going to rent? If you have 24-hour access, who else does? How secure are the windows and doors? How secure will your merchandise or products be while being unloaded and loaded? What lighting arrangements are there? What security system will you be allowed to install, if you need to? What security arrangements can be made for personal belongings?

Check the security:

  • outside the premises
  • inside the premises
  • when receiving deliveries
  • when despatching deliveries
  • of personal property and vehicles of company vehicles

Health and safety

Make sure you are aware of the provisions of the Health and Safety at Work etc. Act 1974 (HASAWA) and its subsequent workplace regulations. Check:

  • COSHH Regulations 1989 (Control of Substances Hazardous to Health)
  • machine guards and rules and regulations for cleaning and maintenance
  • fire exits
  • fire appliances
  • evacuation procedures
  • protective clothing, if necessary

If you are an employer, you are responsible for providing safe and healthy working conditions for your staff. The Health and Safety Executive (HSE) publishes many leaflets and books, several of which are free.

If your workshop, factory or warehouse is part of an industrial complex, you need to check the health and safety regulations relating to that complex, and that you are able to comply with them.

Remember to check the safety of your company vehicles and to have them regularly serviced, particularly if they are driven by someone other than yourself.

Cost

It is impossible to suggest a fair rent for premises because this varies so widely in different parts of the country, and often in different parts of the same town.

It is helpful to make a list of what is essential to you when searching for premises and what is desirable. Also, considering your Cash Flow Forecast, set a maximum rent you are prepared to pay, and stick to it. Remember you might have to pay a one-off premium, sometimes returnable at the termination of the tenancy, as well as rent in advance when you agree to rent the premises.

Develop Small Business

Check whether the rent quoted is inclusive or exclusive of such items as rates, communal services (security guard, window cleaner, for instance), building maintenance and so on. Are there any hidden extras?

It is not always the cheapest rent which is the most economical. Balance your needs against your preferences; if the property does not meet the essentials you require, go elsewhere: be prepared to pay a bit more if necessary, but not beyond the maximum you have set yourself.

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About the Author: Marie Mayle is a contributor to the MegaHowTo team, writer, and entrepreneur based in California USA. She holds a degree in Business Administration. She loves to write about business and finance issues and how to tackle them.

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