Collaborative Post

In some cases, they are actually setting themselves up to fail. For any entrepreneur deciding where they base their headquarters is an important decision.

The instinct of many business owners is to set up shop in a large city. Many want to do so despite the costs of setting up an office somewhere like that being very high. Often, they fail to even consider the idea of establishing themselves in one of the suburbs or a town that is located relatively close to a city. This is a pity because in many cases it actually makes financial and business sense to do so.

The overheads are far lower

There are plenty of very good quality Offices to let in Twickenham and other suburban locations. Typically, these cost a fraction of office space that is located within the city itself.

The rent is always a lot lower, as are the business rates. Plus, usually, firms also end up paying a lot less for ancillary services like cleaning and maintenance.

Most business owners recognise this, yet they still believe that it is worth paying £300 or more a month more for a city location. They feel it helps to boost their brand and makes them appear more professional to potential customers. In some cases, this could be true. But, in many situations having a London address makes no difference to whether someone hires you. Those days are long gone.

It is also important to bear in mind that to make the additional £300, a company that typically makes a 10% profit will have to increase its turnover by £3,000 to cover that additional cost. Some firms will find that basing themselves in a city will help them to be able to make that additional money. But, in reality, the vast majority will not.

It is easier to hire and retain staff

For any business being able to hire and retain the right staff is crucial. In the past, being in a city location made this easier to do. There used to be a bigger population pool to recruit from and cities tended to be far better connected than towns and suburban locations.

Today, that is no longer the case. In many cities, the number of workers who can actually afford to live there is shrinking. The rising cost of property means that more people are being forced to live in the suburbs or nearby towns. Many workers are still working in the cities. But, that is only because that is where most jobs are still located. As a consequence, they are reluctantly commuting for an hour or more to get to and from work using an increasingly ineffective and crowded transport network. A way of life that makes it almost impossible to spend enough time with their families and leads to high levels of stress and sickness.

Understandably, taking a slightly lower paying job to do away with the costs and hassle of a daily commute is something a lot of workers would be happy to do. So, it is no longer difficult for firms who base themselves in the suburbs to recruit.

As you can see suburban offices have some significant advantages over city ones. But, business owners need to take the time to calculate all of the costs of moving offices.