How Paying Rent is Holding Back Your Business Growth
If you’re a small business owner, the hustle and bustle of everyday life and the commercial landscape makes it seem like you’re not so small after all. In fact, according to the U.S. Small Business Administration, your business is among 22 million other small businesses in the country, vying for a chance to strengthen and intensify.
For those of you ready to take the next step in your business development, you may be wondering what you can do to help your business grow. Sure, you can target another market, license your product, or merge with another business to speed up the expansion process. But did you know there is something you’re doing right now, something that you take for granted, that’s holding you back?
I’m talking about paying rent. Do you currently pay rent on your building? If you’re throwing money away and suffering from an awful case of renter’s remorse, there’s a solution. Ditch the lease and invest in your own business.
There are many reasons you should own your own building, versus rent a building from someone else. Of course, we recommend a steel building, but these tips will help your business grow, no matter what type of building you choose.
Conserve Your Cash Flow
For several small businesses, the lease and monthly payment to rent can be much more than what it would cost to own your own building. Think about what you could do with all the extra cash? Maybe you’d want to hire more employees, or purchase more technology and equipment to increase your reach. With more people, you’ll easily be able to build more relationships, go to meetings, or attend events like chamber of commerce gatherings or other types of seminars. Time equals money, and more of a chance to network can only help your business prospects.
Every payment you make doesn’t go to a landlord – it’s an investment into your future. Plus, when you own a customized steel building, more than likely the structure will appreciate over its lifetime. You’ll truly own 100% of the building, and that will help in terms of your assets. But what can you do with your equity? As your business continues to grow, you can use the money or equity to fund other purchases like equipment and marketing.
Maintain Occupancy Costs
Occupancy costs are the whole life costs of buildings. No longer are you subject to increases in the lease because you are your own landlord! You still might have to pay for building utilities, insurance, landscaping and security, but at least you’ll be in control of them yourself. You won’t be, ‘nickel and dimed,’ by a lease you can’t regulate.
If you still think rent outshines ownership, then you haven’t heard of the SBA 504 loan program. The U.S. Small Business Association created the 504 loan program to help businesses purchase owner-occupied commercial real estate and equipment while still retaining working capital. It’s possible to secure this loan if you’re a small business and you want to boost your expansion potential! Ask your financial advisor for more information on securing loans for your small business.
Bet you didn’t think something as simple as paying rent on your building would hold your small business back so much. Break out of rent’s expensive grip, and put yourself on the path to success.Photo courtesy: Charleston’s TheDigitel, stopnlook, mrdorkesq