in

What To Consider While Relocating Your Business

Millennial Magazine - Part of new city
Two blocks of flats on layout design of modern city with architect on background

Relocating a company is something that you have to do with a lot of thought and scrutiny for all investors that may eventually impact the change. As the president of your organization, your primary role is to make decisions that will positively affect and prevent investors from suffering losses. 

However, the decision should be unanimous, and all stakeholders should be present when the transition kicks off.

Relocating an organization can signify many aspects. It can equate to relocating the headquarters from the city center to the outskirts. It could also suggest that you’ll be moving your workplace from one town to another, possibly around the state. 

Another scenario might be to move a part of the business to another venue, still maintaining control of the original place.

Relocating a company has both short-term and long-term ramifications. It’s not a cheap affair to shift all the items of a workplace. The cost increases according to the distance from the original location.

As far as long-term expenses are concerned, your current place has the potential to raise or reduce your overhead costs by adjusting your mortgage fees, services, and taxation. That will also affect the compensation you offer your staff, transportation expenses, and other detrimental impacts.

Therefore, it is necessary to critically evaluate all the mechanisms related to a company’s relocation for those same concerns. Now, here are some of the critical variables you will need to take into account:

Cost

In any business, the operation cost is crucial to consider due to all the hidden or indirect costs of relocating. The first thing you should consider is the cost to move your business from one location to another. A longer distance would mean an increased price to the company.

It’s essential to determine if the potential cost of moving is worth the cost incurred during the business’s relocation. You’ll need to consider if the overhead expenses of the current place can affect your day-to-day activities. Things like mortgages, Shipping costs, Utility bills, and wages could be affected. 

Another thing to consider is if the business will afford to pay for workers to relocate to the new premises. The cost of storage is also a factor to consider when planning to relocate. For example, Suppose your business is relocating from Kansas to London. In that case, you will have to incur a cost for luggage storage as you organize yourself to announce the official launch day to staff members and stakeholders.

The cost of training new staff members in your new location is also a factor to consider. Depending on how many staff members you need and those willing to relocate, the need to train more staff members may arise.

Employee and Investors Impact

People are willing to work for companies that are close to where they stay and easily accessible. Convenience is by far the most crucial aspect when job seekers decided to apply for a position advertised. Amenities like parking space and closeness to the airport are things you should consider when choosing a business location. 

Taxes

When moving from one state to the other or opening multiple branches, it’s good to know your new location’s tax situation and compare it to your current before settling your business. Every state has laws governing the taxation processes, and it’s good to be familiar with all that before making a move. 

Few companies often earn tax incentives for holding offices in various places, so be careful to analyze them as you learn of the resettlement’s tax consequences.

Customers

Your clients form the financial core of your business. When relocating, you should consider the impact it would have on your customers. The effect could be in the form of reduced cost due to moving closer to your customers or increased cost due to increased overhead.

One should be very careful if the business is dependent on one client since relocating either closer or further to the client can influence the company negatively or positively.

Growth Capabilities

When moving your company, it is necessary to evaluate how the new location will affect you both on a long-term and short-term basis. Make sure to scrutinize if the new area has enough labor force to aid your growth. 

Depending on what sort of business you operate, it’s wise to choose a location that favors your business, limiting your cost for training new personnel and offering enough space to expand or make modifications.

Community Effect

Companies that operate in a society are mostly interlinked. This means that if one business closes or relocates, the entire organization is adversely affected. If you move your company halfway across the globe, the number of workers existing in that area may collapse significantly. 

The drop in population of the area may be because of people leaving to search for work. This will then affect small businesses in the region resulting in poor infrastructure and community growth.

Market Research

Many individuals tend to reallocate their business because they want to become a national brand. Doing thorough research of the area you are about to relocate to is vital to understanding an area’s demographics and population. Having accurate figures will help determine if your business will flourish or fail. 

Learning the market gap of a place will also help ensure that you generate enough income to sustain your business in the new environment.

Craigslist

It might sound weird or outdated, but Craigslist is a great way to gather live data and associate you with an area’s local community. Posting a job opening will help know if there is a demand for the service you plan on offering and if the business will do well in the chosen area. 

The decision to relocate a company can have a significant impact on the industry. All parties involved in initiating the change should be very keen on the repercussions of the change and make adjustments to favor all stakeholders and minimize losses resulting from the change. Making announcements before the change will help staff members adjust accordingly, limit unnecessary expenses that arise from staff transfers, and training new members.

What do you think?

Britt Hysen

Written by Britt Hysen

Britt Hysen is the Editor-in-Chief and founder of MiLLENNiAL. In response to the branded ad campaigns absorbed by the media platform, Britt launched Kreativ Ctrl, a full-service marketing agency specializing in experiential programming and strategic partnerships.

Leave a Reply

Avatar

Your email address will not be published. Required fields are marked *

Millennial Magazine - move-into-a-new-career

7 Reasons Why 2021 Is The Year To Move Into A New Career

Millennial Magazine - best-fitness-apps

Best Fitness Apps and Tech to Get Back in Shape in 2021