Industry sector:

Tool hire: Rent

Enter in your cash flow forecast the amount of rent you will have to pay for your premises in the months that you will have to pay it.

If you have not yet decided on a particular premises you could contact a local estate agent who handles commercial property to get an idea of how much the rent is likely to be. You should have already given some consideration to the type and location of the business premises that you will require, so they will be able to give you some guidance as to how much you will have to pay.

You will need enough space to store tools, equipment and plant items when they're not out on hire. This will probably include indoor storage and an outdoor area like a secure yard. You will need quite a lot of secure outdoor space if you intend to keep a large range of plant machinery in stock. You'll also need a workshop area and enough space for your sales counter. You might well need space to park several vans or lorries, as well as sufficient parking for customers (many customers will drive large vans). Customers will need easy vehicle access - they won't want to walk far carrying large and heavy items of hire equipment.

Bear in mind that your premises should be accessible to any customers and staff who are disabled.

Your solicitor will help you with the lease agreement but make sure that you are clear about:

  • whether the premises can be used for the purposes you have in mind
  • how frequently the rent will be reviewed
  • how long the lease runs for
  • what you and the landlord are each responsible for
  • the position as regards sub-letting