Office space can be quite a financial headache, especially for a new business. Of course, it all depends on where your office is. In New York, for instance, you may have to pay upwards of $14,000 annually per employee.
Before you do the math and wonder how many employees you could let go to save some money, you should know that there is a better way to cut office space costs.
And no, I’m not talking about moving your offices to the shadiest neighborhood in town.
Some businesses have opted to use every inch of space in their office by installing cubicles. However, the cubicle design may not work well with your employees.
This type of office layout works against collaboration and leads to a silo mentality.
Here are some better ways to save on office space costs and still have happy employees.
1. Make the Transition to an Agile Collaborative Space
An agile workplace is a workplace that fosters collaboration for the purpose of enhancing performance and promoting trust among the workers.
The office design is more open space rather than an agglomeration of cubicles. This open space framework allows workers to engage in teamwork when they need to. And even to find quiet spaces when they want to work alone.
Also, the open space is cheaper as there are no walls or stand-alone tables that turn the workplace into an 18th century Ford workshop.
An agile workplace is not simply about open office space. Rather, this strategy involves adopting an agile floor plan that allows teams to roam freely.
And, in case you are wondering, just how much office space do I need for this to work, I have good news. An agile workplace can be achieved through movable furniture, non-dedicated spaces and huddle spaces for meetings or for planning.
Yes, it’s even more effective than the dreaded cubicles. Plus, it’s really chic, so what’s not to like?
An agile floor plan is a cheaper alternative to the traditional office plan design. Not only does it promote activity-based working, but also it contributes to the overall decline on overhead costs. With the right office fit out, you can get your agile workplace off to a good start.
Still not saving enough money?
Here are some more options:
2. Allow Your Employees to Work from Home
The work from home option is an effective approach towards reducing office space cost. This kind of flexibility allows employees not only to work from the comfort of their home, but also work when they are most productive.
Many employers are reluctant to see how this option contributes to productivity. The thought of your employees in their pajamas at 11 a.m. is hard to sell.
However, there is substantial evidence backing the fact that working from home can boost productivity. In a study by Stanford University in collaboration with a Chinese firm, the researchers reported a 13 percent boost in productivity.
In the study, the workers were given the option of working from home for nine months. Working from home was undeniably associated with job satisfaction. The employees did not have to endure the frustrations of commuting or having to sit at an office all day.
How does that sound? Well, to them it sounded (and felt!) pretty good!
In the end, it turns out that the employees were motivated to work resulting in fewer sick days and breaks. The Chinese firm boosted their profits by 22 due to the savings on office space.
Working from home is an ideal option for promoting agile working. This approach is flexible and allows the organization to use technology to facilitate collaboration. Today’s employees want to work anytime from anyplace.
And you want to save money.
Let’s make everyone happy, shall we?
One way to achieve this is to spend on workstations instead of cubicles, as well as to promote working from home.
Does it sound scary? It doesn’t have to be! There are many technologies that make this transition easier.
Apps that promote team collaboration, such as Flock, online chat groups and instant messaging tools make it easy for the workers to carry out their job from anywhere in the world.
Companies benefit in terms of efficiency and more profit. A business can outsource some of its work to talented individuals outside the firm. Also, since the employees work from home, the company has a better chance of attracting talented job seekers.
World Economic Forum called the virtual office approach as one of the ‘biggest drivers of transformation.’ The virtual office space is accessible from home or from anywhere the employees choose to work.
A virtual office provides the same benefits as a traditional office, but at a cheaper price. You get a physical mailing address, a live receptionist attending to your calls 24/7, and access to other office locations accessible by the providers’ network.
This transformation can save up to US$10,000 per employee in savings from office maintenance.
The virtual office solution can also contribute to successful agile working as it harnesses technology to provide flexibility and efficiency.
3. Renegotiate the Lease
Office rent is on the rise. Studies reveal that office rent has increased by 17.2 percent since 2010. However, to remain marketable, many landlords are willing to renegotiate terms with their tenants.
You can discuss rent discounts, inexpensive renovations, or other concessions with your landlord.
When you start breaking even or reaping significant profits, you can ask your landlord for a pre-payment option. Pay a few months in advance and get a sizeable discount.
You can also consider the alternative of subleasing from another firm with extra space or join forces with the firm and have a shared office.
You don’t have to live with the office cost headache forever. Nor do you have to have crowded offices in bad parts of the city.
All you have to do is consider technology-powered alternatives.
Agile working and allowing part (or all) of your staff to work from home can be real life-savers. Don’t think it’s feasible?
Companies like Buffer have 100 percent remote teams. And everyone loves working there!
However, keep in mind that this transformation would require careful planning and assessment based on the firm’s existing resources. And, of course, the employees’ willingness to make a complete shift in the way they work.