How do you know when your business has outgrown its space?

Willowbend Service Park prospective tenants find themselves asking that question of their business partners, spouses and bankers. In reality, there are dozens of indicators that it's time to move, among them...

·         All of the so-called spare space in your home and garage is dedicated to your work.

·         The kids' Cheerios get stuck to the back of the invoice your printed in your kitchen/office.

·         Your car no longer parks in the garage intended for it.

·         Your client meetings are held at the coffee shop or always at the client's locale.

·         Your competition has a piece of equipment you don't and the reason you don't is that you have no place to put it.

When you do the math on staying in your current location, it almost always is going to work out in favor of staying put. Office/warehouse space in southeast Wisconsin ranges between $9 and $13 per square foot per year. What that buys you – in the right location – is ease of access, visibility and opportunity. Keeping these less-obvious things in mind when making a decision about a new location is just as crucial as looking at the math.

Many employees and clients make decisions about whether to work for/patronize a business due to its location on a map, and the type of location it is (e.g. home-based vs. commercial space). Amenities like parking and security and upkeep of the property are as much for the employees and clients as they are for the business owner because business today still remains a key place of collaboration and socialization.

Businesses buy their next space for a variety of reasons: Buying creates equity as a tangible asset and buying can be more cost effective than renting. Some businesses prefer to lease for flexibility or the owner isn't sure the business can sustain a mortgage. However, there's a philosophical reason in favor of leasing as well: Intent. Companies always say, ‘We intend to grow.’ Well, what if you outgrow a building you own? Owning actually may be more confining than leasing.

Perhaps the easiest answer is the most obvious: If you've asked the question, 'Do I need more space?' you are already about six months beyond when you should have moved. Maybe the real question is 'Can I grow if I stay where I am?'

Photo by Dieter Hawlan, used with permission.
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