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This month we discuss  the question of whether to buy or rent your business premises; we feature Leon Botha and Pat Larsen in our success stories; and Jeremy Lang offers 10 things to consider when you’re thinking of buying a property.
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July 2013   |   Volume 5.7

Buy or rent: a simple question with some intricate answers

Owen Holland, general manager for property investments at Business Partners, has a simple rule of thumb when it comes to the question of whether to buy or rent your business premises: when you are planning to stay there for more than five and especially ten years, rather buy.

But, says Holland, be careful of the simplicity of the property industry. It draws you in because it looks so uncomplicated, but one small mistake or oversight can have material cost implications. The five-year rule is merely a starting point of what should be a process of careful consideration.

Success story:
Owning your business premises can spur business growth, says entrepreneur

Owning your business premises is often more difficult than renting it in the first five years of the bond, but the advantages are clear when you fit it into your long-term vision, says Leon Botha, financial-services entrepreneur and co-owner of the building in which his company is based.

Leon, founder-director of Optimate Financial Solutions, is about to find out just how true this is.

Success story:
Renting helps to keep things flexible, says factory owner

Flexibility is important for Pat Larsen, a light-fitting manufacturer from the west of Johannesburg. A large part of his income derives from helping clients convert from old lighting technology to the latest, and in an industry so subject to trends, fashions and technological development you have to remain light on your feet.

“You’ve got to adapt pretty quickly to wherever the demand is, otherwise you’re not going to survive,” says Pat.

10 things to consider when you’re thinking of buying a property

When it comes to the question of whether it is better to buy or rent your business premises, the phrase used most often by business experts is “it depends”.  Jeremy Lang, Business Partners regional general manager, is no exception. It is an age-old question, he says, in which each business must grapple with its own unique needs and circumstances.

He offers the following checklist to help business owners frame their thinking:
  1. Has your business stabilised? The most common mistake business owners make with regard to the buy-or-rent question, says Lang, is to buy a property too soon. Wait till your business is on an even keel before you buy.

Business premises for rent

Springfield Industrial Park

9 Mahoganyfield way, Springfield.
Unit sizes vary from 177m2 to 204m2
Contact: Nicolene Booyens
Cell: 072 981 8082
Tel: 031 240 7700

Mkondeni Industrial Park

36 Yarborough Road, Mkondeni, Pietermaritzburg.
RENT FREE PERIOD OFFERED
Unit sizes vary from 209.30m2 to 613.30m2
Contact: Nicolene Booyens
Cell: 072 981 8082
Tel: 031 240 7700

A full list of available properties is available at www.businessmechanics.co.za.
Poll results Do you own or rent your business premises?
  • Rent
  • Own
  • Currently renting, but will buy soon
View previous polls

Complete the survey and win an iPad

The Business Partners Limited SME Index survey aims to gauge just how confident SMEs and entrepreneurs are in South Africa and what their outlook is for the future. The survey also aims to pick up on key social and economic issues affecting small businesses in various industries.

By taking part in the survey, you will automatically be entered into the lucky draw to win a fourth-generation 16GB iPad with Retina display (including Wi-Fi and 3G). A new draw will take place every quarter, so be sure to look out for our survey emails.

The SME Index survey closes 31 July 2013, so complete the survey now!
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