The cost of having an office can make a decent dent in your potential profit for your business. While there are some of these costs which cannot be avoided, and are replaced with similar costs for a portable office, there are some which you just don’t need or don’t need to the same extent.
THE LEASE
This is probably the best part of having no fixed office, the fact that there is no fixed lease. You may end up using some of the space in your house, or maybe a table in a coffee shop, but at the end of the day you are not committing yourself to an expensive lease which you need to cover before you can pay yourself.
THE FURNITURE
Again in essence you do not really need to spend anything on furniture, while you can use an existing table or such at home, you may like to spend some money on a desk to differentiate your spaces. Buying a desk for at home is quite different to buying on for an office where clients are going to visit you. So $300-$400 should be more then enough.
THE TECHNOLOGY
Unfortunately this is one of the area’s that it is hard to compromise on for a portable office. You still need a laptop, @ around $1,200, and if you want easy access to a printer, a portable printer will cost around $500. A portable backup drive will also cost you around $200. However even with these few items you are only out of pocket $2,100 or less then half of what you may expect to spend having a fixed office.
THE SERVICES
Rather then a phone line you are better off having a mobile phone, which will run at about $50 a month, if you don’t over use it. Again for internet you are better off using a Mobile broadband connection, which again is around $50 per month. Overall saving you up to $150 per month.
JUST THE BASICS
Again like in a fixed office there is going to be the total of just the basic’s which can show a good comparison between the two options.
Lease $0 + Furniture $400 + Technology $2,100 + Services $1,200 = $3,700
That is less then 10% the cost of a fixed office and the best part is that in year two you are down to just $1,200 ongoing. Which is actually considerably better then what a fixed office may cost you both upfront and in unrecoverable ongoing expenses.
THE CONCLUSION
The cost of having a portable office is so much less per year as well as up front as a fixed office that unless there was a very major compelling reasons to set up an office then why would you want to. The extra costs eat away at the profit that you could be earning and leave you wondering how much will be left for you.
Working without a home base has specific advantages (primarily cost) and disadvantages – some found here: http://bit.ly/JPOj6 (not my blog)
Seems like a lot of start-ups that I work with go through the at home / business center / shared but as soon as they hit 4 or 5 employees they find it cost effective to lease their own space.