Southcreek News

10 Money Saving Ideas for Small Business Looking for Commercial Realty in Kansas City Part II

Growing businesses need to save all of the cash they can—especially if they are considering a move into a new office rental space. Here are some more tips for tightening up your finances:

6.   Avoid high bank fees. Banks these days are trying to make more money off of fees to compensate for all of the new regulatory changes. Do everything in your power to steer clear of bank fees that are avoidable, such as bounced check fees, ATM surcharges, and debit-card fees. Consider even switching banks if you think you can save more money by doing so.
7.   Think about bundled services. Sometimes companies can bundle services such as phone service, internet, cable, fax, and web hosting. Your business could potentially save hundreds of dollars per year by bundling just two or more services from the same company.
8.   Use payroll debit cards. Your business can cut back on administrative costs by using a debit card payroll system, which bypasses the expense of printing checks and even lowers fraud risks.
9.   Keep track of employee spending. Employees at any level could be misusing or abusing company credit cards. Avoid these issues and save money by setting guidelines, monitoring monthly spending reports, alerts, and activating preset limits.
10.   Use electronic invoices. You can email invoices (e-voicing) directly to your customers, which will reduce your business’s printing and postage expenses.

Saving money in a multitude of little ways can add up for your business, and potentially allow you to save up the money to move into a bigger and better office rental space in Kansas City.

To find out about our available office spaces, call Kathy Woodward at DDI Commercial at 913-685-4100!

10 Money Saving Ideas for Small Business Looking for Commercial Realty in Kansas City Part I

Is your small business wanting to move to a bigger or better location, but unable to afford to do so yet? Here are some creative ideas for how to save money in order to be able to make moves that will lead to a better future for your growing business:

Go paperless. You can decrease printing and storage costs, as well as improve overall efficiency, by going paperless in your office. You can save your business both time and money by scanning documents, which allows you to send and share information much more easily.
Lease office equipment. You can avoid the big upfront costs you would have to pay if you bought office equipment by leasing instead. Leasing equipment would also save your business money on upgrades, repairs, and equipment maintenance, since often equipment leases cover these expenses.
Use a 0% credit card balance transfer. You might consider transferring your debt balance from one card to a 0% APR card in order to pay off your debt while saving money on interest charges.
Collect cash in advance. When you extend credit to customers, think about asking for a percentage of cash up front with all purchases. Doing this could help your company improve cash flow, downsize risk, and save money on having to collect.
Ask for discounts. Your suppliers may be able to offer quantity discounts of up to 50% or more depending on your terms. You might be able to meet these terms and qualify for lower prices. Talk to your suppliers about these discounts and what you can do to earn them. Your business might be able to get benefits such as a major discount for paying early or a loan without interest in the form of a vendor credit.

Little tips like these could save your business money and get you one step closer to moving into your ideal office rental space in Overland Park!

To find out more about affordable office space in Overland Park, give us a call at 913-685-4100!

Ideal Lease Lengths for Your Overland Park Office Space

Once you have decided that you want to find Overland Park office space for lease for your business, you will want to consider the ideal length of your lease term. Sometimes determining lease length can be difficult, because landlords typically want longer leases to secure better financing, whereas tenants are looking for flexibility, which usually means a shorter lease. Here is some information to consider as you think about the ideal lease length for your business:

Tenants who know they will have stable and predictable occupancy needs should try to get longer leases in order to get more favorable lease rates.
Tenants who are quickly growing businesses should try to negotiate leases that allow for expansion rights, permission to sublease their space, or the option to terminate the lease with renegotiated fees.
Retail tenants usually choose the longest leases—sometimes over 25 years.
The average lease terms for office and warehouses leases is usually about five to 10 years, and often tenants have the ability to negotiate one or two lease options that extends the lease term for five years at a time.

As you begin looking into different office space leases, think about what lease length is most ideal for your business’s needs!

If you want to learn more about how to find your ideal office space lease in Overland Park, KS, give us a call at 913-685-4100!

2013 Most Improved Sources of Funding for Overland Park Office Space

Is your business aiming to move into a new commercial real estate space, but looking for the funding to finance this move? There are many different financial sources companies can turn to in order to acquire the funds necessary to move their business to a new space, so businesses have some research and comparing to do before choosing a lender. Urban Land Institute and PriceWaterhouseCoopers conducted a 2013 Emerging Trends in Real Estate survey to attempt to rank what funding sources might see the most financial growth in 2013. These are the ranking results as determined by the survey:

10. Private local investors
9. Nonbank financial institutions
8. Commercial banks
7. Securitized lenders/CMBS
6. Private local investors
5. Mezzanine lenders
4. Insurance companies
3. Private equity/opportunity/hedge funds
2. Institutional investors/pension funds
1. Foreign investors

These rankings represent the anticipated growth in available funding, versus the ranking of different types of funding by available dollars, and remember that these results are based on a nationwide opinion poll, so it is possible that one of the sources might not see growth this coming year. However, if your business is looking for funding sources for your commercial real estate, you might want to look into further research about funding sources like this survey.

Looking into commercial realty in Overland Park for your business? Give a DDI commercial real estate broker in Overland Park a call at 913-685-4100 to find out more about the many different spaces we have to offer!

Distinguishing Between On and Off-Balance Sheet Financing for your Commercial Realty in Kansas City

Previous posts have discussed the difference between capital leases and operating leases for office equipment, as well as the benefits of an operating lease, which offers an off-balance-sheet financing option. However, it is important to note that the rules for properly distinguishing between on-balance-sheet financing and off-balance-sheet financing must be strictly followed. To make sure that businesses are following these accounting rules, the Financial Accounting Standards Board created a list of four conditions for when a lease must be treated as a capital lease:

1.   The ownership of the equipment or asset transfers to the lessee when the lease term is over.
2.   The life of the lease is longer than 75 percent of the life of the asset.
3.   The current value of the lease payments (factoring in an appropriate discount rate) is greater than 90 percent of the fair market price of the asset or equipment.
4.   The lessee has the option to buy the asset or equipment for a minimal price when the lease term ends.

It is important to properly determine which kind of lease you are using for your office equipment, and since these rules can be complex, it might even be wise for your business to consult an accounting or financial professional as you make these financial decisions.

Want to learn more about office lease rates in Kansas City? Give us a call at 913-685-4100 to find out about our wide variety of affordable office suites for rent in Kansas City.

Benefits of an Equipment Operating Lease for Your Office Building in Overland Park

Operating leases for office equipment are often referred to as “off-balance-sheet financing” because lease payments do not affect a business’s balance sheet, since they are treated as an operating expense on the lessee’s income statement. Here is some information about why an operating lease is a beneficial option:

An off-balance-sheet option is often considered better than alternatives, such as commercial loans, in which a business borrows money by leveraging an asset (i.e. accounts receivable). This creates a liability (the loan), which then must be reported on a balance sheet.
In an operating lease, your business does not have to report any liabilities because you are not creating any debt or equity. This optimizes your financial leverage and can make your balance sheet more appealing to potential lenders.
Off-balance-sheet financing can improve the overall financial health of your company by creating liquidity for your business but avoiding leverage. This can help keep your business’s debt-to-equity low, as well as other leverage ratios.

Overall, if you can arrange to rent equipment for your company using an operating lease, this kind of off-balance-sheet financing might help your company’s financial health.

If your business is looking to settle into some affordable commercial space for rent in Kansas City before figuring out your office equipment, give a commercial realtor in Kansas City a call at 913-685-4100!