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What to charge for the use of a workshop?

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  • muddlemand
    muddlemand Posts: 155 Forumite
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    silvercar wrote: »
    He's a mate, he's tidying it up, he's starting out in a new venture.

    I'd be inclined to let him have 3 months free, other than electric costs. Of after 3 months he decides it was all for nothing you have a mate and a tidy studio/ shed. If it works out then you can sit down and discuss a reasonable rate. It also gives you an opportunity to decide if it is something you want to continue with.

    Is he going to have access to your home to get to the shed? Does this shed have a toilet?
    I will sound him out more about how "maybe" the venture's success is likely to be, but from looking at what he used to do, it'll be a re-run of a business that was successful for years. But I'll get him to talk more about this.

    He was talking about claiming it as a business expense so he may even be keen to pay "properly", I'm not sure as i can't remember in detail how that all works with HMRC. (From my good-health days when i did things like this.)

    But i do like the idea of a period to see if it's going to take off, we'll talk that through.

    Access is without coming through the house, though he'd need to come in for the loo. Or he could pee in the field, no one round here would mind.:rotfl:
  • AdrianC
    AdrianC Posts: 42,189 Forumite
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    muddlemand wrote: »
    I don't think there's anything childish about asking a "friendly" group of people more experienced than me, what might be reasonable.
    I think you might have misunderstood my suggestion...

    We know nothing of the relative finances of either of you, of the finances of his business or the credibility of his business plan, the going rates for workshop space for your area, or of the balance between social interaction and intrusion surrounding his use of your surplus space.

    Only the two of you can balance all those factors, and only the two of you can come up with any sort of sensible figure that will be mutually acceptable.

    In and of itself, how the negotiations go is probably a fairly good litmus test of the wisdom of the plan. If you can't come up with a mutually acceptable figure within the duration of time it takes to sup a pint or a cuppa, then this is unlikely to work out long-term...
  • muddlemand
    muddlemand Posts: 155 Forumite
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    need_an_answer wrote: »
    Why don't you suggest that he pays you a percentage of the sales he makes?
    Well... that's probably less simple than a single number. I'd need to see his books etc to make that work. But it is another approach. Maybe if I ever own and want to rent out a bigger space.
  • muddlemand
    muddlemand Posts: 155 Forumite
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    lincroft1710 wrote: »
    If the building is the same size as a lock up garage, what do those go for locally and use this figure as a basis for negotiation
    I'll look at that, good idea.
  • Skiddaw1
    Skiddaw1 Posts: 2,019 Forumite
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    AdrianC wrote: »
    I think you might have misunderstood my suggestion...

    We know nothing of the relative finances of either of you, of the finances of his business or the credibility of his business plan, the going rates for workshop space for your area, or of the balance between social interaction and intrusion surrounding his use of your surplus space.

    Only the two of you can balance all those factors, and only the two of you can come up with any sort of sensible figure that will be mutually acceptable.

    In and of itself, how the negotiations go is probably a fairly good litmus test of the wisdom of the plan. If you can't come up with a mutually acceptable figure within the duration of time it takes to sup a pint or a cuppa, then this is unlikely to work out long-term...


    I think Adrian makes some very wise and pertinent points and that sitting down with a pint/cuppa should be the starting point for negotiations. I'd see if your friend has a figure in mind and work around that.



    Hope it works out because it sounds like a potentially win-win situation for both of you.
  • muddlemand
    muddlemand Posts: 155 Forumite
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    AdrianC wrote: »
    I think you might have misunderstood my suggestion...

    We know nothing of the relative finances of either of you, of the finances of his business or the credibility of his business plan, the going rates for workshop space for your area, or of the balance between social interaction and intrusion surrounding his use of your surplus space.

    Only the two of you can balance all those factors, and only the two of you can come up with any sort of sensible figure that will be mutually acceptable.

    In and of itself, how the negotiations go is probably a fairly good litmus test of the wisdom of the plan. If you can't come up with a mutually acceptable figure within the duration of time it takes to sup a pint or a cuppa, then this is unlikely to work out long-term...
    Fair enough. (I've said more now, about ouur relative finances and all those things, in my first reply.) The one thing I didn't know was roughly what this would cost "normally", on which to base my adapted asking price, so I came here for people's thoughts.

    I like that rule of thumb about working it out in the time it takes to have a cuppa, I'll remember that. :)

    The big thing is that I think he's far more experienced than I am both in business and in haggling, buying informally (Facebook and small ads etc), all that kind of thing. I don't want to be greedy or unfair but I also don't want to lose out by being naive. If I wasn't worried about money already, I wouldn't worry and would probably not even ask to cover the extra electricity costs, initially, as a favour, but I'm not free to be that nice.

    I have given him lifts for an amount for petrol, and even lent him my car once, and the amounts he suggested were exactly what I'd expect to pay in more formal arrangements (volunteer driving organisations that I have used and a website I forget the name of where private individuals rent their cars out on the Airbnb model). That seems to be how he expects to go about things in every case.
  • silvercar
    silvercar Posts: 46,962 Ambassador
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    I suspect he has an idea of what is reasonable, so you could be led by him; especially as he has dealt honestly with you in the past.
    I'm a Forum Ambassador on The Coronavirus Boards as well as the housing, mortgages and student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.
  • Norman_Castle
    Norman_Castle Posts: 11,871 Forumite
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    muddlemand wrote: »
    I thought he was going to work from home, he has bought the kiln and so on, didn't know he wanted more room until just now.
    A kiln might be expensive to run so measuring his electricity usage might be wise.
  • muddlemand
    muddlemand Posts: 155 Forumite
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    Norman_Castle wrote: »
    A kiln might be expensive to run so measuring his electricity usage might be wise.
    Good point. My elec. supplier shows my usage in kWh, so it'll be easy to see the difference.
  • need_an_answer
    need_an_answer Posts: 2,812 Forumite
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    Will the workshop activities be noisy or disruptive to any near neighbours?

    points raised over running a commercial business from private residence might need to be addressed if there were to be an issue that maybe a near neighbour made a complaint to the council

    However if you live in the middle of nowhere with no near neigbours to bother then it might not be such as issue
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