Your office, your factory, your restaurant or your shop. The business property where you operate is central to your success – but is also one of your biggest costs. With the outbreak of coronavirus (COVID-19), many businesses are facing the temporary closure of their primary property. Even if you’re not, the costs associated with property may start to look prohibitive if sales or other revenues fall during the outbreak.
Elsewhere on this site we’ve produced quick guides on the subject of fixed costs and cash flow. Here though, we provide more insight and advice on property in particular. As well as the obvious costs such as rent and rates, there are other costs associated with business property that might be worth looking at again. These include utility bills, for example.
The government has already outlined several measures of support to help businesses with property costs and other challenges relating to the coronavirus.
To help you understand what you can access, and what else is out there worth considering, we’ve rounded up the latest advice and tips on looking after your property during the outbreak.
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5 things you can do (right now) about your business property
(1) Check whether you’re entitled to a business rates holiday
At present, the government has announced a rates holiday for companies in the retail, hospitality and leisure industries. This holiday covers the 2020/2021 tax year and your business needs to be based in England to qualify. There are some full details of the criteria to access this holiday on the government’s dedicated webpage, but if you are eligible the process should be automatic.
(2) Talk to your landlord about your options
If your business has already been forced to close, may do so in the near future, or you are concerned about cash flow issues speak to your landlord. Explain your situation and your broader plans for operating during the outbreak and see whether they would be willing to grant you some leeway on rent. Landlords are going to be concerned about their own revenues over the next few months, so may well be receptive to an open conversation about this.
(3) If you own your premises, think about who else could use it
There have been several reports in the media already of businesses “pivoting” to start new product or service lines during the coronavirus. It’s possible that these businesses will be looking for different kinds of spaces in which to run these new offers and your premises could help them do it. A good place to start will be speaking to your local chamber of commerce which should be coordinating business help and response during the outbreak.
(4) Consider whether you need all your current space
You may have rental agreements due to expire in the next few weeks or months. While the full impact and timescale of coronavirus remains unclear, it’s worth considering how much space you’re going to need over the next few months. You can always expand later, but shrinking your property space now might be worth considering.
(5) Protect your premises
Even if your premises have been forced to shut down, you are still likely holding valuable stock, machinery or other materials in them. Make sure your security systems are up-to-date, especially as you are more likely to be spending significant periods of time away from the location.
Don’t miss out on our dedicated coronavirus business support page
Looking after your business property during the coronavirus
There are various government support measures in place already, and a wealth of advice, guidance and tips from trade associations, businesses and other experts available to access online. We’ve rounded up a few of the most essential here.
Want to know whether you qualify for a rates holiday or other support?
Business rates holidays have been setup for companies in retail, hospitality and leisure businesses so far. Full details are available on the government’s dedicated business support page. Even if you’re not in these sectors, it’s worth checking this page regularly as more measures of support are being announced on a regular basis.
Need to brush up on how business rates work?
Some businesses have already been granted rates holidays. Even if you’re not eligible, it’s important to remind yourself how the system works and what kind of costs you will be facing. Simply Business has another good guide on business rates.
Want some advice on negotiating with your landlord?
Real Business Rescue has lots of good advice and context in this piece about how to speak with your landlord when rent becomes a problem. Another article on the same site provides a frank and honest assessment of the steps that may occur if paying rent becomes a long-term problem. It provides lots of different options for you to consider.
See what protections the government has introduced to help you
If an agreement can’t be reached, the government has introduced new protections to prevent commercial tenants from being evicted. If you’re unable to secure a rent deferral or holiday, knowing what protections are in place will allow you to prioritise your costs and remain on-site.
Do you have a lease expiry or rent review coming up soon? Read some tips on how to negotiate
Your next negotiation on rent could be crucial to controlling fixed costs during the coronavirus outbreak. SmallBusiness.co.uk provides a great rundown of the things to consider when you go into that discussion. Solicitors Hart and Reade have five more good tips as well.
Thinking about the steps to take to protect your facilities during the outbreak?
The trade association for security services in the UK, National Security Inspectorate, has a wide range of information and advice on protecting your property. Elsewhere, Start-Up Donut offers an eight-step guide on what to consider about your property. It includes how to assess your risks and vulnerabilities, physical as well as electronic security and what to do if you have any concerns about arson.
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