It is not often we talk about how a physical office move can save a business money overall, but we should be talking more about this. We know for most businesses, the second-highest expense is office rent. Office rent in London is on average £50 – £110 per sqft according to a Q1 report from Statista. Based on 50 people in a business, on average the office space could vary between 5,000 and 7,000 sqft. The rent which the business may pay is up to £770,000 per annum. To put this into context relating to the above, we could move this business size 190 times and still not reach the rent per annum.
There has undoubtably been a lot of changes throughout the last 18 months. One thing will always remain the same ‘we’re all social animals’. We all need human interaction and a place to meet, connect, learn, and grow. Businesses had no choice but to embrace and implement technology into everything they do. 18 months on after a roller coaster for many of us, we are now seeing an increase of activity back in cities and a return of life back in offices. Leaders are now reviewing their real estate portfolio and thinking about the future of their workplace. With this comes an office move or reconfiguration of their existing space for collaborative working, with a mixture of desking, soft furnishing, and meeting room space.
Moving to a hybrid working world; creating a flexible working culture in your business and allowing your people to flex their working time between the office and their home could save businesses thousands or hundreds of thousands per year. C-suite executives are reviewing their office space and looking at ways to reduce operating costs. The office occupancy is down between 50-70% from its maximum occupancy. If you previously had an office for 50 people you may now only need space for 25 people. We don’t need to explain the potential savings this could have for businesses.
At present the office occupancy isn’t at its highest, representing physical distancing in the office, allowing for safe working. Other businesses are opening office hubs in other cities and towns. An example is; if a business HQ is located in London, and a majority percentage commutes into London from Chelmsford, this business may decide to rent office space in Chelmsford at an average cost of £20-£25 per sqft and downsize the London HQ.
When relocating offices there is a lot of variable costs to consider. We all know space costs money in any environment. Saving space on filing cabinets for some businesses will reduce their occupancy costs by thousands each year. Based on office space of 10,000sqft with around 80-100 people in the business, if they transitioned to a paperless office and scanned files to a cloud-based system, the average space this may save would be 20 – 25 filing cabinets (assuming one metre of filing per employee). You instantly save around 28-35m2 of floor space if you remove these. The saving in money could be estimated between £21,000 to £28,000 per annum. Changing your workplace culture and implementing new technology takes a lot of planning and expertise. A filing audit will benefit your business from a cost, time and change perspective. The first step is to determine your current processes and file retention policies, along with the filing you have in your offices. Once the audit has taken place, you can review the filing you have vs the filing you need or want. The next step is to find cloud-based solutions for your filing and any off-site or on-site storage you need.
If you can reduce office space by 50% you could save an estimated £360,000 per annum in rent. These savings aren’t small. The investment in the actual cost to physically relocate offices would seem very small compared to the savings a business can make annually.
If you would like to talk more about office removals and how our services can support your overall workplace strategy reach out to us by email or phone firstname.lastname@example.org London: 02038 761479 Chelmsford: 01245 976650.
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