In the last 12 months, the business world has been changed by the rise of the COVID-19 pandemic and the subsequent lockdowns we’ve all been placed in on a seemingly endless cycle. Seven in ten office-based businesses are planning on downsizing or relocating as a direct result of the move towards remote working. Because many companies simply don’t need as much office space anymore.

 

What things need to be taken into consideration and what help financial help is available when a business decides to downsize its physical operations? Let’s start by examining the benefits.

The benefits of downsizing

Overheads - Not only will you be paying less in rent but your heating and lighting overheads (and your carbon footprint) will be reduced too. Smaller premises also means lower insurance costs.

Capital - Selling a larger property and migrating to a smaller one should leave you with a hefty chunk of change to invest in the business.

Operations - Businesses that are more compact are generally more focused. You’ll be amazed at how much more gets down when you’re all within shouting distance of each other.

Considerations for downsizing

Of course, this all sounds positive but before you pull the trigger and completely relocate your business around this ‘new normal’ there are some serious considerations to take into account.

Budget - While you might be saving money in the long-term, in the short-term any relocation project is going to be costly. Go over exactly how much the move will cost you and analyse whether or not the long-term savings are worth the short-term cost and disruption. Note, however, that a secured business loan could be the ideal solution here, as you should be able to borrow all that you need and then pay it back as soon as the long-term savings kick in.

Staff - If you’re going to be moving the offices some distance, how will that affect your existing employees? If it’s going to have a major impact on the length of their commute then it might not be worth the effort. Can you really afford to lose anyone right now?

Communication - It’s not just your staff that needs to know that you’re moving but your clients and suppliers too. This means putting together a downsizing campaign including everything from social media posts to leaflets and emails.

Growth - We understand that many businesses in the last 12 months have concluded that the future is online and in remote working. However, for businesses with an element of physicality to them, sometimes a smaller physical space means you’re limiting your size and scope.

There is a lot to think on and work through here but the bottom line is this - downsizing is the perfect solution for some and a mistake for others. There is no right answer here so before you take that leap, make sure you’re aware of where you’re planning to land.