When setting up as a freelancer, one of the first decisions you will make will be on where you deliver your services. Sometimes the nature of your work will dictate this automatically—as an example, if you will be relying mainly on agency placements, then you will be working at the office of the agency's client. Other than these few exceptions, you will need to decide whether it is best to work from home or a dedicated place of work.
Working from home certainly provides a range of advantages in convenience for the self-disciplined, but can also prove to be a detriment to productivity for those who are easily distracted by temptations.
There are certainly some useful financial and lifestyle advantages in choosing to work from home:
No travel—saves time and expenses:
Without travel, you can start work earlier or catch up on more sleep should you wish. No travel also means that you eliminate wasted time associated with heavy traffic and cancelled trains, as well as saving your personal expenses of getting to work. This is also handy when you end up working late, meaning that you can avoid the additional hassle of traveling home
Save on rent:
By working from home, you avoid spending on additional rent, which is something that comes in handy when money is tight—especially when you are first starting out as a freelancer
Tax savings:
If you are working from home, you can claim a proportion of your costs on expenses such as home insurance, heating, lighting, water rates, council tax and general maintenance as a business expense so that the amount of tax you pay is lower
Work in your pajamas:
If you're feeling lazy or feel more comfortable working in your pajamas, then this is certainly a benefit to have
Although there are a number of desirable advantages, working from home also has a few disadvantages that will affect your productivity and strategic capabilities:
Many interruptions:
Whether it's family, neighbors, pets, or friends, disruptions can ruin your productivity—especially when you are 'in the zone' when working on more intensive work requirements. It's said that such disruptions can take you up to 25 minutes to regain your mode of thought and productivity
No physical location barrier to separate work and personal life:
For people who like routine, what is considered to be home will become blurred as work. This is especially a disadvantage when under pressure at work with 'home' distractions making it harder to get into work mode, while also the opposite being true when trying to switch off from thinking of work during out of hours time
No collaboration environment:
If you are working with other professionals on a regular basis, the home isn't usually a great place to foster collaboration activities
Lack of contact with other people can contribute to negative psychological effects, resulting in decreased morale and productivity
Likelihood of having to give clients your home address:
On the whole, this shouldn't be a problem—and being an 'ethical' freelancer means that client's shouldn't have to be hunting you down. However, there are some clients who are unrealistic on their working relationships with you—sometimes going as far as to pressure you into working unrealistic hours by suggesting that they come and work with you on a Saturday morning or during the night. It's in these situations where having a real working address can avoid certain situations—what would you do if you client turned up at your house at 10am on a Saturday morning to insist that you work on their last minute requirements?
Temptation to not work and do something social instead—like watch TV
At least in a separate working environment you can ensure that there are no distractions like your TV and gaming console. At home, you have access to all of your entertainment—will this pose a risk of being a distraction from doing real work perhaps?
For many people, it's certainly useful to have a separate workplace than home, but what expense does having a dedicated office for your work have?
The main advantages of having a real office for your business activities revolve around improving your productivity. As a freelancer, the faster you turn out your work, the more you can earn in the time you have available for work.
Work-hour structure can help you keep focused—that is, traveling to work like a regular job:
Working away from home avoids the possibility for you to get too comfortable working at home and to ensure that you have the same routines as you would have with a regular job where you travel to work for set times. This is good for people who are less disciplined in their time management, as having a regular work structure helps to ensure that work actually gets done rather than having work productivity suffer from home distractions and putting work off until later
More likely to be viewed by clients as a professional:
Although in reality an office is no reflection of your technical competency, in most cases having an office to invite clients to meet you will provide them with more confidence that you are a real business that they can depend upon. This is especially true for small and startup businesses who have no technical knowledge in the areas that they are hiring you to help them with
Separate your home from your work more easily:
Some people will find that living both a work and social life in the same environment difficult to live with—that is, where does work start and end? A real office gives a psychological boundary to ensure your work and social lives don't merge into one. In this case, the saying never mix business with pleasure has never been so true!
More convenient if you are hiring people to work with you or if you are working in a partnership:
For most, it will feel less comfortable to have employees and business partners working from their home. With an office, you can have others working in a real work environment to ensure that there are no home distractions and have a common workplace that fosters creativity and collaboration
Having a dedicated office for your work will certainly push up your expenses and rule out some of the savings you could make by working from home. If you are the type of person who is disciplined enough not to get sidetracked by home distractions or simply don't have a big budget to begin with, using an office may be something would want to consider at a later date—if at all.
Rent can be expensive
Certainly, during the early days of setting up as self-employed, every penny counts. Whatever you spend on office rent is money that you can't spend on other aspects of your business that will lead to success and your ability to make a profit. Can you afford to rent an office?
Additional costs such as business rates and insurance not covered by your home insurance:
At least when working from home, some of your home insurance and council tax that you would otherwise be paying can be recovered
Can get lonely if it's just you in the office, but not the case if you work with other people
Requirement to invest in furniture:
Having an office is all very nice, but it will only be of any value when it is properly furnished. In addition to the other associated costs such as business rates, insurance, and rent, you will also have to invest in office furniture, meaning more money that is taken away from aspects like marketing that are critical to your success
For those who find it difficult to be productive from home and can't afford or want to spend on the extra expenses of renting an office, there's the option of renting some desk space from an established company or a business incubator unit. This option provides a happy medium where you get all of the advantages of having an office to work from, but at a fraction of the rental cost. You also benefit from not having to directly pay many of the expenses associated with setting up your own office such as furniture, heating, lighting, and business rates, because these will be covered by the desk rent.
A new type of desk renting is referred to as co-working, where freelancers and small business owners are able to purchase desks to work from on a day to day basis. This is a step down from renting desk space, which is a more permanent arrangement and has cost saving advantages if you only need to use the desk for a couple of days per week. There are also some events arranged as co-working days where different freelancers attend to work—although these often tend to be about an opportunity to network with other freelancers and less about doing work, so don't expect to be highly productive if you attend these events.
A popular option for many freelancers in all fields, especially freelance writers, is to work from a cafe. This has become a lot more popular since the emergence of mobile computing and with most cafes now offering free wifi Internet access. The combination of these factors means that many freelancers only need to have a laptop to access everything they need to work from an environment that separates them from the distractions of home—or even the office!
Cafes provide an ideal place to get work done, with their environments not being too noisy and the ability to access refreshments when wanted. Their open space also provide good locations to hold meetings, whether this be with clients or people your collaborate with.
Without being tied to working from a single location, you have the advantage of being able to choose different cafes to work from—whether this be through choice or convenience. Although you will be paying for your refreshments, it is likely that any costs will be lower per month than any of the other options while still providing most of the advantages.