Friday, March 22

Business owners urged to hold off on expanding spaces… for now

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Don’t over cater for business needs – rather wait until elections are over

Business owners who need to move offices or expand their current office space should try to hold out until after the elections.

If they cannot, they need to ensure they do not overestimate how much space they need, advises Chad Shapiro, senior commercial property broker and director of CTS Property Services.

Ideally though, all businesses should promote working from home.

“Businesses needing to expand must do so. It would be prudent to wait until after the elections, but you also cannot put your business on standstill in order to wait, so we advise to not over cater for business needs.”

Owners trying to choose between moving their entire office set-up to bigger premises and opening up a second office elsewhere should be aware that one combined space “is always preferable”, Shapiro says.

And this is because setting up separate venues in separate locations has a higher cost implication and is less convenient to run. “Office automation is improving all the time and this has a direct impact on users looking for office space, as mostly they are able to work virtually with clients and/or colleagues, thus making the requirements for office premises a lot more lenient for business owners who are trying to keep their costs down.”

He believes the main advantage to having a business in different locations is that it allows for exposure in different locations, staff to have a convenient access to their workplace and being closer to amenities that will benefit a company and its staff.

“It seems the main reason for taking second offices is to expose in additional locations and this is fine if the locations chosen cater correctly for their required purpose.”

Office automation allows staff to work and meet with clients virtually, making large office premises unnecessary. Picture: Gerd Altmann

In the current economic climate though, Shapiro always advises clients to work from home if possible. “Office premises are most often the highest fixed cost that a business incurs and it is important to be mindful of the various cost implications. Therefore, if costs can be kept to a minimum, less space is advised.” 

Owners would be wise to consider all aspects of an expansion or relocation before rushing into it, echoes Leon Breytenbach, national manager of the Rawson Property Group’s commercial division.

“Carefully weighing up all facets of your business will help you determine whether the time is right to move on to the next level… Careful planning could make this the best move you have ever made, but an ill-considered decision could cause problems.”

Whether moving or expanding, Breytenbach urges business owners and managers to remember to include the costs of: 

Upgrading or installing internet, wi-fi and computer systems and moving or updating your telephone system. 
Redecorating the offices, if needed.
Removal costs if you are relocating.
Possible upgrading of the electricity supply if the existing set-up is insufficient for your needs.

“Allow for the cost of changing stationery as well as advertising the greater work capacity, new address or second operation you will be offering your customers,” he adds.

Furthermore, when negotiating the rental for enlarged or new premises, try to secure a good deal from the landlord, as this will help to make the exercise more viable. Location is “vital” to the success of any business.

“The ideal solution would be to find larger premises which remain readily accessible to your existing customers but where you are also able to attract new ones,” Breytenbach says.

Proximity to your workforce is important because transport costs can be crippling for the average employee and unreliable transport causes unpunctuality or absenteeism.

A new location should also offer access to everyday needs for the workforce, such as schools or care centres for their children; shops; entertainment and affordable housing.

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