4 Things I’ll Never Spend $1 On When I Scale My 1-Person Business in the Future

Thinking shaped by experience and circumstances

When I joined my current company, we were a team of 4.

• 1 Managing Director.
• 1 Marketing Director.
• 1 Pre-Sales Senior Manager (me).
• 1 Office Manager.

And then came November 2022.

The world we knew crumbled.

Our entity has not been profitable and could no longer be financially justified by my headquarters.

3 of us were asked to leave. I was tasked to turn things around.

I ran with the flag.

The first thing I did was purely financial-driven. I dug into our numbers. It was beyond ugly. We were bleeding money non-stop.

I decided to pull the trigger.

I called the landlord.

I told her I wanted to terminate the office lease.

It Was an Arduous Journey

Everyone knows setting up an office takes time.

Renovation, wall painting, decorations, furniture and fittings, tables and chairs, WiFi and routers, whiteboards, and markers.

Leaving the office for good takes a long time, too.

The reason?

Renovation, wall painting, decorations, furniture and fittings, tables and chairs, WiFi and routers, whiteboards, and markers.

Surprised?

I was.

Let me explain.

The landlord required the space to be returned “as-it-was”. It must be reinstated to its original state when we first leased it. So, teary eye Aldric cannot simply walk away.

That was big shock # 1.

And then…

I discovered to my dismay, that reinstating the office back to “as-it-was”, was expensive.

• Interior designers are required for overall office reinstatement.
• Technology assets (such as PCs) must be shipped back to HQ.
• An asset fire sale must be held to get rid of office furniture(s).
• The compound must be chemically sanitized and cleansed.
• The air-conditioning must be certified clean and dusted.
• Utilities and corporate WiFi accounts must be closed.

It was a barrage of work.

I called my CFO immediately to work out a budget to cover the following.

• A principal contractor to run the 4-month project,
• General work for office reinstatement,
• Freight shipment of IT assets.

A total of $7,000 is secured.

Her face was twisted when the numbers came out. I know, I know…

But I was glad that I had money to unwind the lease.

And I thought… I was done.

A 6-Hour Conversation with My Accountant Almost Killed Me

I almost died from a heart attack.

2 words explain why.

Write off.

This is a general explanation of accounting write-offs.

A write-off primarily refers to a business accounting expense reported to account for unreceived payments or losses on assets… [it] indicates that an asset is no longer expected to produce any income.

Does this sound straightforward?

I thought so.

Tables, chairs, shelves, fridges, interactive touchscreen televisions, and docking stations can be handled easily. We can sell them at a profit or a loss and log it into our financial statements.

The keyword is sell.

Or sellable, if there is such a word.

What about those items we fail to sell? Or “things” with intangible value, like renovation?

Easy.

They fall into the write-off category.

This is where things become tricky. Let me explain.

There are 4 line items I must write off from my entity’s financial statements because they cannot be sold and are intangibles.

Here they are.

• Office renovations.
• General piping & ceiling work.
• Electrical wiring and creation of charging and LAN ports.
• Carpeting.

They correspond to the 4 things I’ll never spend $1 on if I must set up an office in the future.

I have 3 reasons.

• I can get the work done, but I cannot take them with me when I leave.
• These are expenses that cannot be monetized when I walk out.
• It incurs additional spending to remove them in the future.

In short, the money is spent, and the benefits are temporary.

The reason is not an accounting one.

It points to the nature of renting.

It is nice to have refurbishments so we can resonate with the work environment. The original state might be hideous and not conducive to working.

I get that.

I get all of that.

But let me say this.

Are you ready to face the music and explain the amount to be written off to your CFO when your lease has expired or terminated?

I had to write off nearly $81,000.

That is a lot of money.

And so, I have learned to incorporate one in-principal thought process into me after this saga. It applies when I make purchases.

I will not spend $1 on the office or fixed assets by default.

That money can be better spent on client meals and event marketing. Or working equipment like a portable multi-port. Or subscriptions to business magazines like Harvard Business Review.

In fact, let me share one embarrassing secret with you.

I’m happier operating from a hot desk at a co-working space today.

I need not deal with leaking pipes and utility bills.

It. Is. Beautiful.

The Close

I am not nudging you to be cheap.

That is not the message.

This is.

Spend to grow your 1-person business, but also avoid spending on things you cannot recover from.

I had the experience and benefit of hindsight.

You might not have.

Speak to an accountant or a friend who understands accounting when in doubt.

Avoid the financial mistakes my corporate forebears made.

It is expensive, painful, and requires additional time, money, and resources… to return to Square 1.

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