Improving Business Efficiencies in the New Financial Year
With the current financial year drawing to a close, now is an excellent time for any sized business to review expenses and explore efficiencies to implement in the new financial year.
Whether you’re a large corporation incurring significant lease expenses, or a small business looking to scale up operations, flexible workspace should be an important consideration.
A recent report by Colliers International, revealed some interesting findings regarding the outlook for flexible workspaces in 2018, particularly around the financial efficiencies of flexible workspaces vs traditional leases:
The Correlation Between Headcount & Leasing Costs
The report cites a growing trend of large corporations ‘...demanding flexibility in their office spaces to directly correlate headcount to leasing costs’.
This is a critical relationship to balance for any size business.
A flexible workspace, such as a serviced office at Corporate House, allows you to scale your workspace size up or down as your business grows or contracts. Only paying for the space you require could significantly improve the overall profitability of your business in the new financial year.
Upcoming Changes to Financial Reporting Standards
Another noteworthy point from the report – from 2019, the Financial Accounting Standards Board (FASB) & International Accounting Standard Board (IASB) will require businesses to disclose lease obligations for real estate on their balance sheets. This is expected to add more than 2 Trillion USD to balance sheets throughout the Asia Pacific Region!
However, the report goes on to state that ‘… Short-term agreements for flexible workspace will typically sit outside of the FASB and IASB reporting obligations’
With your balance sheet being a snapshot into your business’ position (health) at any one point in time, adding a large liability for a long term lease obligation could paint a very different picture of your business to external parties such as banks & potential investors.
In light of the new reporting standards, the flexible terms offered by Corporate House could potentially assist your business to minimise your reported lease costs, preserve business capital and reduce ‘dead space’ costs, such as under utilised meeting and boardrooms.
The Rise of Alternative Leasing Models
The ‘City Campus’ leasing model, in which a company utilises satellite locations within flexible workspace providers spread across a city, in addition to a primary head quarters, is also flagged as being an increasingly popular option for sales and client facing individuals and teams.
Corporate House is one of the early pioneers of this workspace model in Queensland. With our tenants having access to all Corporate House locations throughout Brisbane, Ipswich and The Gold Coast, the ability to ‘hot desk’ throughout our network allows tenants to work closer to their clients. Ultimately this creates opportunities for better servicing of clients and reduced travel time for mobile workforces.
If your business is struggling under the weight of an inefficient, long term lease agreement, or you’re a small startup wanting to implement an intelligent workspace strategy from the beginning, contact Corporate House today on 1300 968 763 to book a tour of any of our locations throughout Brisbane, Ipswich and The Gold Coast.