If you’re looking to get into retail, but you don’t want to commit to buy, renting out a shop is an ideal alternative. Many businesses are starting to discover the benefits of renting out a store, but before you consider doing it, there are quite a few factors to take into account.
Here, we’ll look at the benefits of renting out a shop in retail and the things you’ll need to consider.
What are the benefits?
So, why should you consider renting a shop rather than buying one? Well, firstly it’s a much more cost-effective option. You get the chance to dip your toe in the water, without having to pay huge overheads. The cost of buying a commercial property can be huge. So, when you’re just starting out, renting can save you a fortune in the short term.
By renting out a shop, you also protect your business if it doesn’t work out. If you’ve bought a shop, you’re going to need to worry about selling if it doesn’t prove worthwhile, and you’ll be confined to one area. When renting a shop, you can always just either move to another area if it isn’t working out at the end of the lease, or choose to leave the retail market completely.
Another benefit is the fact you can look at a shop to let in a desirable area. Retail space in shopping centres and desirable locations can cost a huge amount of cash to buy. Renting on the other hand, makes it possible for businesses to afford a shop in a more central, desirable location.
Factors to consider
While you don’t have as many responsibilities when you rent a shop, there are still some factors you’ll need to consider. For example, you’ll typically be responsible for:
- Health and safety
- Repairs and maintenance
It’s your job to carry out a health and safety assessment to establish and eliminate any potential hazards. You’ll also usually be responsible for any repairs and maintenance to the building. This tends to surprise business owners as they assume, like with domestic property rentals, the landlord would be responsible for making any necessary repairs. It’s worth noting that some landlords do take care of maintenance and repairs, but you’ll need to double check the tenancy agreement.
Renting can be an effective way of owning several businesses at once, giving you total flexibility when it comes down to mass managing several extensions of your production line. Considering the unpredictable economy, having your business attached to a rented premise could save you from financial turmoil as in some cases you may have the option to buy out of a contract.
Overall, renting out a shop is a fantastic way to test the retail market. The above are some of the best benefits you can expect from retail rentals, but remember to take into consideration the potential costs of repairs and maintenance, that too should be something to contemplate.