A guide to third sector trading - WCVA

It’s an idea, but is it business? A guide to third sector trading
1: Getting
started
2: First steps 3: Business
planning
4: Legal and
governance
5: Funding
and
resourcing
6: Financial
controls
7: Managing
growth
8: Management
and
governance
9: Social
enterprise
10: Sources
of support
Type of tenure Advantages Disadvantages
Lease
Taking a lease for a fixed period of
years at an annual or ‘rack’ rent
Tenancy agreement
A verbal or written open ended
agreement with a monthly, quarterly
or annual rent and which can be
terminated by either side giving notice
• Security of tenure (usually) rights under
The Landlord and Tenant Act 1954
• Local authorities can restrict future use of
the premises using charges placed on lease.
• In some cases rent may be low or
peppercorn
• In some cases maintenance costs may be
shared with landlord
• The local authority may be better disposed
to granting discretionary rates relief
• Easily terminated by the tenant
• Rent may be cheaper
• Often less responsibility for repairs/insurance
• May have security of tenure
• More likely to have discretionary rates relief
• Expense of rent and service charges (which
may increase regularly
• Cost of repairs and insurance
• Shorter leases limit a group’s ability to
improve premises and to raise funds for
improvements
• Normally little security of tenure especially if
verbal or for a period of less than six months
• May be restrictions on use of premises
• Makes fundraising more difficult
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