Wednesday, April 17, 2024

A Business Owner’s Guide To Renting vs. Building A Warehouse.

February 8, 2018 by  
Filed under Money/Business, Weekly Columns

(Akiit.comWhen you first started out in business, there was no need for a warehouse. Your customer base was much smaller, which meant that a stockroom was more than enough space for storing products in. However, now that your business has grown, that has changed. While you never had any need for a warehouse before, now you do, which brings us to your dilemma – should you rent or build a warehouse?

The fact is that both renting and building your warehouse come with a list of pros and cons, it’s just a case of taking these on board and determining which is the best option for you and your business. The truth is that what works for one business won’t necessarily work for another, which is why it’s so important to think carefully about the option that you opt for, taking your business and its specific needs into account.

Just because your competitor’s built their own warehouse, does that mean you have to do the same – does it? The fact is that when it comes to the warehouse that your business needs, it’s important to remember that your business is unique to any other company, and for this reason, has its own unique needs.

Without any further ado, we will discuss the pros and cons of each option below, to help you determine which is the most suitable choice for you and your business.

Let’s start with renting

Of course, the main pull of renting a warehouse over building one is the cost. There’s no high initial cost to cover, just a deposit and the price of rent each month. The fact is that if you are on a small budget, renting a warehouse can seem like the best option. Especially if you are able to get a deal on the cost of doing so by signing up for a year or two years in advance, leading to the landlord knocking a month or two’s rent off of your bill. 

A common reason why businesses choose to rent a warehouse rather than building one is because they only need it for a short time period. If you’ve never required a warehouse before but do now, then renting could be a good option, especially if you aren’t sure how long you will need it for. For instance, if you are planning on moving your business to a larger premises in the next six months or so that will offer adequate storage space, then you may only need temporary storage, which means that renting would be the best option. Of course, while renting a warehouse, even if only temporary, you’d still need to advertise warehouse labour jobs so that you could get the help that you require to keep your warehouse in tip-top shape. The fact is that you don’t want your warehouse to end up in a mess, which is why taking on the appropriate help is so crucial.

As for the disadvantage of renting a warehouse, one is the fact that it’s not a great long-term solution. This is because over time the costs of renting can add up and it can become an option that is no longer budget-friendly.

Another reason that renting can be a bad idea is because of security. Some landlords don’t allow their tenants to deal with the security of their warehouse buildings themselves, which can pose a question over how secure the facility is. Of course, if your landlord is open to you dealing with security yourself, then that’s no problem, but if not, renting a warehouse may not be the best option for you.

Time to talk building

When it comes to building your own warehouse, one of the largest benefits that this offers is the fact it’s an investment. You see, should you ever decide to sell up, you will be able to make a profit from the building, therefore making it an investment.

Then there’s the fact that if you choose to build your own warehouse, you will be in complete control of it. This means that you will be able to access it any time of the day or night, as it’s your building, so you have full control over it. This also means that when it comes to security, you can put whatever security measures that you like in place.

Another benefit of building a warehouse over renting one is the fact that you can make changes to the layout. Should you realize that the design isn’t providing optimal space, you have the power to change that. It’s your warehouse; you can do whatever you like with it.

The great thing about choosing to build from scratch is the fact that you can have your warehouse constructed to perfectly meet your needs. Steel buildings seem to be in high demand at this time. You can design the space yourself, and ensure that it is perfectly designed and laid out to meet your business’s storage needs. You can create a space that is the perfect size and shape for what you need, making building a great option if its affordable for your business, that is.

Along with the many upsides of choosing to build a warehouse, there are also some downsides. These include the fact that as the owner of your warehouse, it will be your job to deal with all maintenance of your property, in addition to dealing with security.

Then there’s the fact that if you decide to move your business to a new location, you may need to sell your warehouse and build or buy another one. This is an issue that you don’t have with renting, as you can give your notice and simply rent another readymade building.

The fact is that while both options have their pros and cons, in the long-term building a warehouse is far more beneficial than renting one. This is because building is not only more cost-effective but also because building gives you the power to customise the space and create a storage facility that perfectly meets your business’s needs.

Staff Writer; Doug Stewart

Speak Your Mind

Tell us what you're thinking...
and oh, if you want a pic to show with your comment, go get a gravatar!