Sunday, June 23, 2024

How to Budget for Your Office Fit-Out

While we’ve seen a continued push from the government and some entrepreneurs to get their employees back into the office in the wake of the coronavirus pandemic, recent figures from Remit Consulting have shown that this has yet to translate into any actionable change.

With an average of 16.6% occupancy last week, there has been no significant increase in the number of office workers returning to their desks, with this number up just 0.2% in relation to the previous seven days.

Given this and the potential for remote working to become increasingly commonplace in a post-Covid labour market, it’s reasonable to presume that many business-owners will be considering relocating or investing in an office fit-out in the near-term.

We’ll explore the latter idea in a little more detail below, by asking how you can successfully budget for your office fit-out.

Do You Need an Office Fit-out?

Even in the best-case scenario, the cost of office refurbishment and a comprehensive fit-out can represent a significant investment (especially in the current economic climate).

With this in mind, your first step should always be to determine whether or not you actually need an office fit-out, as there may be more suitable and affordable options in certain scenarios.

For example, let’s say that you’re switching to agile or hybrid working in the wake of the pandemic, and therefore want to focus on introducing hot desks and open-plan workspaces. As part of this process, you may also want to factor in social distancing measures by affording each employee more space in which to work, creating the need to reimagine your office interior completely and improve its ergonomics.

However, an office fit-out may not be the best or most cost-effective way of achieving broader goals, such as boosting the wellbeing or productivity of your workforce.

In these cases, you should consider less costly and incremental changes before commissioning a full office fit-out, such as creating a positive workplace culture, improving communication from the leadership and emphasising employee recognition.

What Factors Impact the Cost of an Office Fit-Out?

If you do decide to go ahead with an office fit-out, the next step is to consider the various factors that can impact the total cost. We’ve outlined some of the most important below, so that you can create a more realistic budget and manage your expectations accordingly:

  • #1. The Type of Work Required: Not all fit-outs are created equal, as while some require a few cosmetic tweaks, others demand new flooring, additional partitions and similar structural changes. This will have a direct impact on the cost per sq ft, so you’ll need to have a clear understanding of your requirements from the outset. Similarly, you should consider your choice of ICT and AV systems, which offer flexibility in the case of agile working and allow for superior design and aesthetics.
  • #2. Your Finish and Furnishings: Fit-out costs per sq ft are also impacted by your choice of furniture and fittings, which in turn depends on your office occupancy levels and core number of employees. Typically, the cost of office furniture ranges from £400 to £700 per individual, so you’ll need to include this as a key part of your budget. Another important factor is your choice of finish, as the cost difference between basic and premium interior finishes can be deceptively high.
  • #3. Your Timeline: If you’re switching to a new office space or looking to introduce hybrid or agile working as soon as possible, you’ll also need to create a relevant and realistic timeline for the completion of the fit-out. Of course, projects with shorter timelines may drive increased labour costs, while you’ll have less opportunity to spread out the workload and manage your spending over an extended period of time.

Of course, other universal factors include the age and nature of your building and whether or not it has raised floors (which are ideal for the optimal distribution management and power supply).

You’ll also need to include any budgetary factors that are unique to your circumstances, so preparation is key when creating your budget.

The Last Word

By determining the precise motivation for your office fit-out and understanding the individual factors that impact the eventual cost, you can hopefully make informed decisions as an entrepreneur.

Most importantly, you can determine just how viable it is to conduct an office fit-out, before creating a realistic budget that’s manageable and capable of delivering a return on your investment!

Claire James
Claire James
Claire is an accounts manager at Fire Digital UK, an online publishing and content marketing company based in the North West.

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