I often get asked by entrepreneurs, “when is the right time to get an office?”. This is often more difficult to answer than you would think it is, because various factors play a role as to whether you need an office or not.
The questions you need to ask yourself are:
Do you need an office?
Do you really need an office? Can you not do what you are doing from home? Yes, we would all like to have an office, but in most cases it’s really just a nice to have to stroke our egos rather than a must have.
However, if you are planning on having a shopfront (brick and mortar), then it goes without saying that you need space.
Can you afford it?
Does your Net Profit allow for you to get an office? In other words, after you have paid all other expenses and your own personal salary, do you have enough profit left in order to get (and justify) an office and maintain it (furniture, stationary, cleaning, etc).
Do you have staff working for you?
If you have staff working for you, then an office is most likely a requirement, unless of course you really want to go lean like most start-up tech companies do and work from your garage to save costs. I recall working from our garage when we launched Hiyer, a tech start-up, with 7 staff. Even though we could afford an office, we elected to work from the garage when we needed to be together, and remotely at our homes the rest of the time.
Are you a self-motivated individual?
As surprising as this question is, most entrepreneurs struggle to motivate themselves to work from home. This is not due to a lack of passion, but usually due to the environment they are in at home not being ideal for work. Are you motivated enough to work from home, and if not, what is that motivation going to cost you in renting a place? Usually the price tag on this is not worth it, and cheaper to spend that money on a coach or mentor to keep you motivated.
Do you have space at home for your business?
Often entrepreneurs just do not have the workspace they require to work from home, such as distributors or manufacturers. In these cases, offices or workshops are a prerequisite. However, if you a developer, consultant, online retailer, or another type of solo entrepreneur, all you really need is a desk and chair with your equipment, and some space for stock if you a retailer. If you do not have the space at home, get an office or workshop.
An office is not a precursor to success and does not highlight the value of your company. There are many home based entrepreneurs growing their businesses, and many running very successful multi-million dollar businesses from the comfort of their homes with meetings being held at coffee shops, at the client’s premises, or even via Zoom or Skype.
Naturally as an entrepreneur you will come up with a dozen excuses as to why you need an office to justify the expenses to yourself, but the fact of the matter is that if you are needing to justify it to yourself, you don’t really need the office. Start-ups that start off lean and build as they grow have a much higher chance of success than those that don’t.
Should you need an office, first consider renting office space on an ad-hoc basis from companies like WeWork, Spaces, Regus, etc, etc that provide hot desks, offices and the like to entrepreneurs that are fully equipped with all the equipment and services you need, before going out and spending capital on your own offices. This will prepare you for what you will require when you eventually setup your own offices.