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Flexible Office vs. Traditional Office Solution

An office costs more than just rent. The Flexible Office is the affordable alternative.

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The question of the costs of an office is one that we naturally deal with very intensively. Even in the early days of Westhive, i.e. about five years ago when we opened our first coworking space in April 2018, we focused on the question of the effective costs of a workplace beyond the pure office rent and the price per square meter.

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The costs of your own office are underestimated

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At least one conclusion we came to very quickly: The costs for the office are underestimated. An analogy from the car industry probably applies best: The effective costs for the car are around three times the monthly leasing rate. It’s the same with the office: the effective costs for the office are x times the pure rental price. How much more expensive will it be in the end? Let’s take a look at a sample calculation to find out.

In addition to the cost of rent, there are various other costs

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In addition to the pure rental costs, there are also the utility costs. These can easily amount to around 15% of the price per square meter and typically include the costs of heating (and cooling, if available), hot water and operating costs such as caretaking, waste disposal, cleaning of general indoor and outdoor areas, snow removal, etc.

If the office is offered as a shell or noble shell, there are also finishing costs. These range from CHF 1,500 to CHF 2,000 per square meter, depending on the standard of fit-out. For an office of 150 square meters in size, this means that the finishing costs amount to more than CHF 200,000, which must be depreciated over the term of the contract, depending on the length of the lease. The difficulty here is that the shorter the rental period, the higher the annual burden. In other words: the higher the flexibility, the higher the monthly depreciation costs. Meeting rooms also come into play here: they require valuable square meters, are rarely used to 100% capacity and place an above-average burden on the equipment budget.

In addition to the costs for equipment, there are also the costs for furniture. A workstation with table, chair and storage space costs between 1000 and 1500 francs. In addition, the costs for the technical infrastructure (Internet access, WiFi access points, printers, etc.), the office equipment (flipcharts, whiteboards, document shredders, etc.) and the various supplies must also be taken into account. The latter also includes the consumables: coffee, tea, water, etc.

Last but not least, cleaning and maintenance of the premises must also be taken into account.

The calculation shows: Flexible office models are cheaper

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On this basis, we have now made the comparative calculation. The short version is as follows: an office of 150 square meters for 10 employees costs around CHF 1000 per workplace at a rental price of CHF 280 per square meter per year, including expansion, for a 5-year contract term.

It is almost like leasing a car: in fact, it is about three times more than the pure monthly rental costs per employee. This is hardly surprising. In internal billing, companies calculate monthly costs of CHF 1500 to CHF 2500 per workstation, depending on the location and equipment of the offices, and this sometimes includes the cost of IT hardware. But even if you deduct these (today, this cannot be more than CHF 200.- per month with the best will in the world anyway), you are still far above the CHF 600.- to CHF 1100.- per month and workstation that a workstation costs at a flex space and coworking provider.

Grafik: Zusammensetzung der Kosten einer Büromiete

A company that chooses a Flexible Office solution can save up to 36% in costs compared to the traditional office model (calculation example: company with 10 employees, 2 meeting rooms, 5-year lease term, 5% annual growth).

Lack of flexibility is a driver of costs

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The greatest saving, however, lies in the flexibility of the number of workstations. It always comes into play when companies grow or shrink.

If growth is anticipated, the rental space must take this into account. A company that grows by 20% will need around 50% more space after two years and, in the traditional office model, will have to rent – and pay for – this space from the very beginning.

In the best case scenario, the growth occurs and the office is just the right size after two years. If growth continues, however, it quickly becomes too small. And if there is no growth, the office will remain too big. So you either pay too much – or you have too little space.

Grafik: Wachstum der Belegschaft

Conclusion: Flexible office models save money

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In summary, with the right Flex model, office costs can be reduced in practically all scenarios of varying team sizes and durations. And the built-in flexibility allows the company to “breathe” and adjust the number of workstations to the effective demand.

Our office cost calculator shows the savings that are possible with a flexible rental model.

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Screenshot des Kostenrechners ORCA

Do you have questions?

Talk to our experts

  • Claus Bornholt

    Founder & Partner