The cost of doing business can be daunting, especially in high-cost metropolitan areas like Los Angeles and New York. The idea of owning one’s own building (versus rent) sounds appealing until the receipt of the property tax bill. Fortunately, there are options for doing business in a successful manner that is the least detrimental to the business pocketbook.
The Need
The cost of doing business is not going down. It can be mitigated, with the creative approach, but inflation is likely to rear its head again, in spite of the fact that, in places like the United States, the economy has been doing better over the past few months. Even in times of economic improvement, increasing the profit margin is a desirable outcome.
A few decades ago, the cost of commuting was not as high as it is now and there was not the convenience of using the internet to get work done. The only real option was to go into the office. Now, with many more options, come many more opportunities to cut costs.
Creative Thinking
Any time there is a need to cut costs without cutting services, the use of creative thinking comes in handy. The same goes for identifying that economical office space or approach to using office space effectively.
The changes in American and global culture have also affected the approach to these solutions. While, in the past, there were the cubicle farms, now, even the attorneys are thinking about the “open space” mentality in office design, as detailed in this article, “Lawyers Without Offices." It would seem that if attorneys can do it, many other professions could, as well.
Some Options
One common solution to the need to save money on office space and office rent is to become a virtual company or to have some virtual employees that work from their home office. This is becoming more and more common since it appeals to the employee who does not want to pay the rising cost of commuting and to the company who can save money by not having to raise salaries to accommodate that high cost. Even Mashable gets in on the conversation and provides tips on how a person can “score a job at a virtual company.”
Sometimes a combination approach with the virtual employees is to incorporate a lower-cost rental option that an executive suite offers. Often times, these “rentals” come with a fully functional office (including conference room and multi-media solutions), as well as office staff. The beauty of the arrangement is that the landlord, handling all of the staffing and human resources needs, employs the office staff and the payment for the services is like a part-time staff person expense, but with qualified personnel. This is an ideal solution for a start-up that is new and does not yet have virtual administrative staff, but needs a visible office immediately.
Another option that has been around longer than the virtual company, and even before the internet, is utilizing mobile offices. These have been used, for years, at construction sites and schools, as portable offices and portable classrooms. While the outside may appear somewhat portable, the inside can be decorated to be quite modern, leaving it hard to tell that it hasn’t been set on a permanent foundation for years.
There are many conveniences to mobile offices, including being able to move them from location to location (as in the case of construction sites) and being able to use them for a set period of time (the appeal for schools). In the case of a business, especially when the business is a start-up and the measurement of long-term success (or how much success) has not been determined, this is an ideal way to “set up shop” without a permanent commitment to the purchase of a building or the high cost of rent. Granted, it is not likely that this would be a solution that can be used in downtown Los Angeles, but it would be quite appealing in an appropriate suburb.
There are many options available and likely, it is the combination that will yield the most success in long-term business objectives and cost-saving efforts. Possibly, a combination of the rental of an Executive Suite, the use of virtual employees, and the mobile office is the solution that would be right for the next Fortunate 100 Company in the making.
