Working from home can be a real Catch 22. With little overhead,
few (if any) employees and the freedom to run your office however
you see fit, you've become so successful, now you've got
more work than you can handle on your own. For many homebased
entrepreneurs, this all-too-common scenario begs the question: Is
it time to move out of your office in order to grow the business,
or should you stay the same size--and risk turning down
work--because you don't want to or you're unable to grow
from home?
"When it gets to the point where you need an employee or
multiple employees--you can't simply contract with somebody
anymore, but you actually need an assistant, you need people to
help you run the business--then you've probably outgrown the
home," says David L. Deeds, an assistant professor of
management policy and entrepreneurship at the Weatherhead School of
Management at Case Western Reserve University in Cleveland.
For David P. Kowal, a sole PR practitioner in Northboro,
Massachusetts, the idea of expanding his business outside his home
office has come to him often during his 11-plus years of running
Kowal Communications
Inc. Through the years, he's increasingly found himself
freelancing work to other professionals, needing the extra
assistance. So a few years ago, he started looking at office space
and even considered purchasing property--as an investment--to house
his business instead of leasing. And not just any old office space,
but something conducive to creativity. "I think anyone that I
would hire would want something that has a little bit more
character to it," says Kowal, who looked at about 20 different
properties, ranging from an old railroad station to a former post
office, to try to find the environment he envisioned.
Content Continues Below
Kowal almost bought an old home to house his business, but,
after finding out it wasn't zoned as a commercial location, he
decided to remain in his own home and expand in another direction
by starting a second business, PR firm 3D-PR, to accommodate
the increased demand for his services. Working with a network of
independent contractors, 3D-PR allows them to work on larger
accounts together, while they all continue to work for their own
companies--and in their own offices. The new venture brought in
sales of $58,000 last year, adding to 2001 sales of $352,000 for
Kowal Communications and allowing Kowal to remain homebased without
losing opportunities for growth. Says Kowal, "It's
provided me with an opportunity to continue to grow my business,
which is something I always want to do--to stretch myself a little
bit and work with some people that I hadn't worked with in the
past--and it's really starting to come together."
Although cost wasn't an issue for Kowal in considering
whether to move into an office, that's not the case for most
homebased entrepreneurs, according to Deeds. If you move into a
commercial office, it won't be just the lease you'll be
paying for; you'll have the added cost of purchasing equipment
and office furniture as well paying for extra utilities, phone
bills, and Internet and other services. And if you hire employees,
you've got insurance, worker's compensation and their
salaries to consider. When deciding to move from a home office,
"it's the same decision of expanding capacity for any
other business," Deeds says. "There's a whole new
level of dollar you have to make every month to cover the
expansion."
Deeds suggests thoroughly researching all the costs involved
with making a move and even bidding on services to get a real feel
for exactly what it will cost you, then weigh the benefits of
moving against the costs.
Originally published in the June 2002 issue of HomeOfficeMag.com
Page 1 |
2 