Question

Generally speaking, departments located near entrances, on major aisles, and on the main level of multilevel stores have the best profit-generating potential. What additional factors help determine the location of departments? Give examples of each factor.

Answer 1

1. Office lease or co-working space? :

   The first decision you should make is what kind of space to move into.

   Office leases are more expensive and do tie you in for a longer period, but they give you more freedom in what you can do with the space. Personalising the space with your own branding makes a significant difference to your team’s morale and the image that you present to clients, especially in more traditional sectors like finance.

   Co-working spaces will be better for you if you have fewer members of staff and some growth potential, or you only need the space for a limited period of time. What’s more, being in a co-working space strips away responsibilities like replacing coffee and toilet roll. These spaces often organise free classes, clubs and talks (and dish out free biscuits!) to promote worker wellbeing too.

2. Hidden costs :

   When setting out your moving budget, remember to include stamp duty, fitting costs, solicitor’s cost and buying agent’s fees. Though rent will make up the bulk of your office cost, these will contribute a significant amount. It’s also worth learning what the business rates are for the buildings you’re interested in.

   Remember to factor in running and cleaning costs once you’re in the office as well as the fees you might incur for the stuff that didn’t come with you if you have to pay for disposal.

   Read through the lease before you sign up so that you’re aware of the costs to be covered by you and your landlord.

3. Fitting with the brand image :

   As we said previously, your office location is an extension of your brand image.

   If you’re a slick tech start-up, people won’t respond so well to a dingy rundown office. However, if you’re a not-for-profit organisation with a more frugal identity, spending a hefty penny on your office space sends out the wrong message.

4. Legal considerations :

   Read up on the legal implications of moving office as they may have changed since you last made the shift.

   Your new office must meet safety standards in terms of health hazards, fire protection (the local fire department can help here) and lockdown procedures. When moving offices and machines, don’t forget about handling data in line with GDPR.

5. Room to grow (if necessary) :

   High-growth companies are going to need space to expand. Forecast how many more people you’re planning to hire and find a space that’ll accommodate this – it might act as a motivator in meeting your goals too!

   On that note, if you want staff that work in-house, you’ll want to be near your talent pool. Check in with local recruitment agencies to establish what kind of talent is prominent in the area you want to move to.

6. Competition in the area :

   Figure out what the competition is like in your desired location.

   Greater competition is often a driver for better performance. With that in mind, you might want to launch in an area that’s associated with your sector, such as being near to Silicon Roundabout in Shoreditch if you’re a fintech company. Then you’ve got the opportunity to work off other firms for customers and supplies, forming strategic partnerships you might not have planned for.

   Be aware that competition could damage your business performance in certain sectors. For example, if you’re a marketing agency in an area which already has a high concentration of marketing agencies, you might suffer unless you have a niche like representing females or businesses in the food industry.

7. Convenience for your staff :

   Of course, your office needs to be accessible by bus, train, tube or tram. For employees who prefer to pedal, the new place must be reachable by bike too. Ensure it has a bike park or is near a docking station and provides decent on-site facilities like showers and drying cupboards.

   If there isn’t a car park on the premises, tell staff where the nearest parking spaces are.

   It’s universally acknowledged that wellbeing is crucial for employees. When considering location in relation to your staff, think about proximity to cafés, bars, gyms, banks and shops to take care of their basic needs.

8. Easy for visitors to get to :

   Your priority is to make your office easy for staff to get to, but what about visitors? More remote office spaces could be difficult to get to by public transport or to find on Google Maps. If it’s a bother to find, it could spell a bad start to your business relationships. Weigh up the cost of having a cheaper office that’s more difficult to reach versus a more expensive office in a place with greater business opportunities.

   The right office space can be the difference between landing and deterring clients.

9. Being close to suppliers :

   If you rely on suppliers for physical products – especially items that aren’t widely available – you’ll want to be close to them. Moving further away and keeping your current supplier could be costly in terms of increased delivery miles so it’s worth trying to find someone closer to you if that’s the case.