Seperate Location VS Home Office - Contractor Talk - Professional Construction and Remodeling Forum

realpurty2 · 05-08-2006, 10:00 PM

I've noticed there are many here who work from a home office and equally as many who have a shop or office location. I'd like to know some of the thoughts that weigh in when deciding if and when it's time to move up/out of your current location.

We're debating on whether it's time to expand to a new location with a bigger office and more storage. When looking at the pro's and con's, here is what immediately came to mind. Feel free to add your own considerations, that's what I'm looking for.

Pro- Bigger and more professional looking office space reflects on the company image in a positive way.

Pro- More storage space

Pro- Would have room for a print room, a workshop, and still have plenty of storage.

Pro- We can customize the inside almost anyway we want. It's a bare canvas ready for me to unleash on. I think of it as "Burger King", I can have it MY way. lol

Con- Located directly in the middle of two competitors. I mean right smack dab in the middle. One is a reputable GC , the other is a wannabe who thinks that a business license and insurance on his worktruck makes him a "Licensed and Insured Remodeling Specialist and Concrete Service". We'd be right between those two, sharing parking lot and entrances door to door.

Con- Expense.. we're making do with the shop we have now but it is full and packed to the brim with equipment and inventory. The office is small and not public friendly in my opinion. We go to the client for contract signing and such so in all my years here, we haven't had alot come in the office anyway. Is it worth the extra expense?

Do you feel working from home helps or hinders a business? We'd have to locate everything from the house while building the new one. Keeping the old shop while building would be too costly to maintain.

Thoughts?

IHI · 05-08-2006, 10:22 PM

"someday" I would like to have a seperate shop just for business, actually my sign guy and I have talked many times keeping our eye's open for a facility that could house both our businesses to share expenses to make it more feasible for the both of us. Actually found a nice 60x140 building that when I heard the price I almost wrote a check myself for the place....glad I went to look at it with him...only needed at least $50K in renovations and location absolutely sucks.

Anyways, on one hand it would allow a store front to become a dealer for multiple products and open up profit margins, on the other hand at this point I dont need anymore headaches curently by adding a second overhead. Hard enough selling stuff around here with a home office and small crew, cant imagine what the homies would do to me if I had to add on extra to cover operating costs that would be more than they are now...

If you can swing it, go for it. But if it's tight or iffy already it might be worth sleeping on it a few days/weeks and trying to budget right now what expected overhead would be in the near future should you make the move to see if it's really feasible at this current time, or would be worth waiting. I know personally in light of the economy, while I'm not getting completly freaked out like some guys (even though 4 I know have gone under in the past 6 months locally), but let's just say I'll be saving alot more than I have in the past just in case the bottom drops in the next year or two I dont want anymore out going than necessary to whittle away at my money's

Mike Finley · 05-08-2006, 10:48 PM

Quote:

Originally Posted by realpurty2

I'd like to know some of the thoughts that weigh in when deciding if and when it's time to move up/out of your current location.

There is only one factor for me and that is budget. As soon as the budget allows I'm out of the house that day and into an off-site location. I'm contemplating right now just renting a storage site big enough for a truck, trailer and some tools and materials.

PipeGuy · 05-09-2006, 12:13 AM

Quote:

Originally Posted by realpurty2

Do you feel working from home helps or hinders a business?

I only have a home office because of cash considerations. When the business builds to the point where I can swing a mortgage, I'll either buy a home with an outbuilding or buy a small plot (less than 3 acres) somewhere and put a couple of trailers and pole barn on it (I don't want lots of storage space). The way I see it, land is about the only tangible thing my business can invest in; tools and equipment start depreciating the minute their purchased.

ApgarNJ · 05-09-2006, 05:21 AM

I'll probably always have a home office. we are about to add onto our house here, with a large attached garage, and ill use a lot of taht over sized garage for my business. most of my tools and equipment are on jobs all the time. and i'm looking to get a trailer, so that most of bigger stuff doesn't have to be loaded into the truck each day. employees just drive to the jobsites and meet me there.
i think it really depends on if you want to keep expanding, or can your current site be reorganized to not seem so packed and small. some businesses need a store front to help bring in business. for my line of work, I don't see the need for an a separate location. if i had 20 employees and they all had to park here each morning, then i'd be looking for another place that was strictly a shop.
it's a tough call. and i think it just depends on each person's case.

**slickshift** · 05-09-2006, 06:03 AM

When we relocated one of the plans was for a separate office/shop
It was just too darn expensive out here

I hope to be able to afford it in a year or two

I have no advantage working out of the home really
Just financial

Mt shed and garage have work equipment in them
Family interruptions are not too bad, but common enough
90% of them wouldn't happen if I was in another location

A bigger and more professional looking office space and shop certainly does reflect on the business in a positive way

go dart · 05-09-2006, 06:27 AM

our shop/storefront allow us more creditibilty and we are more effecient.
some vendors won't deliver to a jobsite like andersen,homecrest, and wholesale flooring vendors. we do share office space w/ some shower displays but most often use vendor showrooms. i've rented here for 7 yrs but i should buy a place. it would be an asset to sell when its time to retire.

Bone Saw · 05-09-2006, 08:25 AM

I agree with all the pros/cons previously stated. I only see buying or owning as being worthwhile, just look at the turnover in retail/comercial zoned districts, any buisness with longevity probably own the property, the renters and leasers come and go.

Grumpy · 05-09-2006, 08:34 AM

It is my opinion that if you are going to run a business of any sibstantial size, you really need a seperate location. In the contracting business alot of our visits are made to the customer's house so it's not as important, however I still feel it is of the utmost importance.

Would you buy a burger from some guy slanging out of his garage? Would you buy prescriptions from someone selling out of their basement?

A+Carpenter · 05-09-2006, 10:05 AM

I work out of my home and the business office. If the kid is sick I can work at home. If the works really busy I work out of the office. I have a pretty good size office and it makes for great entertainment when I get bored. I can flip on the radio or sit and talk on the phone.

A+Carpenter · 05-09-2006, 10:07 AM

Quote:

Originally Posted by Bone Saw

I agree with all the pros/cons previously stated. I only see buying or owning as being worthwhile, just look at the turnover in retail/comercial zoned districts, any buisness with longevity probably own the property, the renters and leasers come and go.

You have a point here. It is a lucrative business and the turn around is insane.

PipeGuy · 05-09-2006, 10:28 AM

Quote:

Originally Posted by Grumpy

Would you buy a burger from some guy slanging out of his garage? Would you buy prescriptions from someone selling out of their basement?

Yes to both provided the vendor had a demonstrable history of delivering a desirable product.

Provided your business doesn't demand a space for interaction with or promotion of clients (a counter to sell over, a room to meet in, a studio to produce in, etc.) I don't see how any manner of physical facility (or lack thereof) adds or detracts materially from the value recognized by THE CLIENT; that is to say the client doesn't perceive value (benefit) from the efficiencies you recognize from your choice of facilities. They typically perceive value in price offered and performance demonstrated.

maj · 05-09-2006, 11:45 AM

It all depends on your type of business....

If your business, for example, is selling & installing windows, siding, & shingles; then it would be advantageous to have a storefront with office & showroom. In my case, all my work is done in the field, with the customers project being the "showroom", if you will. My office is in my house, and I have a 2560 sq.ft. shop/storage. I would be throwing money away by leasing or owning another property for business office.

Each individual must assess their own business type or desired business to determine the best solution.

IHI · 05-09-2006, 02:04 PM

Quote:

Originally Posted by maj

It all depends on your type of business....

If your business, for example, is selling & installing windows, siding, & shingles; then it would be advantageous to have a storefront with office & showroom.

I can see where that'd be helpful, but not a necessity per say. I have enough demo models that are in the truck when going to do a bid of a certain nature I literally bring the showroom to them as I think most of us probably do. It would be nice to have a spererate entity for a showroom to have displays set-up much like homecenters with all colors/profiles of siding as well as standing window boards so they can see them installed since many times they ask what is reused, what is replaced, etc...I've often thought about building a frame around my main demo model, but that thing is heavy enough by itself without adding to it

Even the few guys around town that do all of the above listed aspects and have a seprerate shop for biz, it's nothing special and more/less just a sectioned off place that is clean enough for customers coming in but I dont think it's detrimental at all since the salesmen for these guys do in home sales anyways.

I too would have no problem buying something from a guy working out of his garage if the product is good and proven. Heck, most of our racing stuff is done that way from chasis work to actual parts...I could care less where it comes from so long as I get what I paid for.

Grumpy · 05-09-2006, 03:16 PM

Quote:

Originally Posted by PipeGuy

Provided your business doesn't demand a space for interaction with or promotion of clients (a counter to sell over, a room to meet in, a studio to produce in, etc.) I don't see how any manner of physical facility (or lack thereof) adds or detracts materially from the value recognized by THE CLIENT; that is to say the client doesn't perceive value (benefit) from the efficiencies you recognize from your choice of facilities. They typically perceive value in price offered and performance demonstrated.

I have customers come to my office quite often. Sometimes they just drop in out of the blue.

I have had many customers ask me when "interviewing" us if we work out of our home, or have used the words "Is that a commercial location?" Therefore I do think having a seperate location adds percieved value, and perception is reality.

At the same time I have employees come to the office every day, some even have keys. That's not possible working out of my house.

Last reason I will give, if I work from home, there is no "sanctuary". I will always work. Instead I got a little office just down the street from my home and can always zip in at any time for any reason... however when I am at home I am all about relaxing and my family.

In regards to bonesaw's comment I do indeed intend to purchase a commerciall property once I am slightly more well off financially. Until then I am forced to rent. I pay a measely $300 a month for an office which accomidates 4 desks.

Grumpy · 05-09-2006, 03:17 PM

This is one of those threads that we tend to repeat over and over every couple months. This is probably the 4th since I joined the forum discussing the exact same topic.

realpurty2 · 05-09-2006, 03:25 PM

Quote:

Originally Posted by Grumpy

This is one of those threads that we tend to repeat over and over every couple months. This is probably the 4th since I joined the forum discussing the exact same topic.

My apologies Grumpy. I should have just searched the archives.

Bone Saw · 05-09-2006, 03:58 PM

I feel that if you NEED a bona fide showroom, than having a seperate location is justified weather buying or leasing. But as far as a "shop" unless you have a very large commercial operation, having it at the home is great if you have the space and are not in violation of any ordinances, and it is non of a potential customers buisness how or where you conduct your "shop" buisness.

Bone Saw · 05-09-2006, 04:03 PM

Quote:

Originally Posted by realpurty2

Pro- Bigger and more professional looking office space reflects on the company image in a positive way.

Pro- More storage space

Pro- Would have room for a print room, a workshop, and still have plenty of storage.

Pro- We can customize the inside almost anyway we want. It's a bare canvas ready for me to unleash on. I think of it as "Burger King", I can have it MY way. lol

Con- Located directly in the middle of two competitors. I mean right smack dab in the middle. One is a reputable GC , the other is a wannabe who thinks that a business license and insurance on his worktruck makes him a "Licensed and Insured Remodeling Specialist and Concrete Service". We'd be right between those two, sharing parking lot and entrances door to door.

Con- Expense.. we're making do with the shop we have now but it is full and packed to the brim with equipment and inventory. The office is small and not public friendly in my opinion. We go to the client for contract signing and such so in all my years here, we haven't had alot come in the office anyway. Is it worth the extra expense?

Having a seperate location or lack thereof, should be directly proportional to meet the needs of your buisness, speaking strictly from a economical standpoint.

Some of the top builders and remodelers around here work out of home shops similar to Tom R's and Deck ect's, the suppliers provide the showroom for the products.

Melissa · 05-10-2006, 04:24 AM

There are many many reasons for us getting a shop. And for getting one right now when we probably should wait until the finances are better. We are taking a risk but are pretty confident that it will improve our business which will in turn cover the cost.

Main reasons are:
To seperate work from home.
Extra space to be more organized and efficient
To look and feel professional
To expand our business- Michael wants to go into cabinet making. He will need space, and will need to be in a commercial area to be running a saw all day long.
A big one for myself personally is to get out and among other people and businesses. It's energizing and motivating. I can't stand to be in the house all day.