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Pros and Cons of Business Relocation

Moving Tips

Business Relocation? So Do We Relocate our Business

There are many worthwhile and valid reasons to consider relocating your business and in the long run you might find that the move pays off with very significant rewards, as long as there remains sensible and realistic reasons for the move that go beyond prestigious, or other less relevant measures. There are some very important points though, that warrant consideration before you decide to go through with a move of such complexity.

Some Pros and Cons of Relocating your Business

Pros: There should be every expectation of a significant increase in customer traffic converting into sales contacts/transactions

Cons: There will be significant relocating costs that go beyond just the move per se but may be offset or negated in the long run by the increase to sales/business

Pros: There should be significant savings in cost of production/manufacture due to increases in efficiency in new location

Cons: There may be a significant loss of valuable labour or key support staff and some time lag before suitable replacement staff can be inducted

Pros: There may be significant government and other support mechanisms available for a relocation particularly interstate

Cons: Associated government levies and taxes may negate any support or assistance available

Pros: Relocation may facilitate expansion into areas of business previously untried eg. export 

Cons: Expansion into new areas may mean significant increases in investment for new equipment and staff

As you can see there is much to be weighed up in considering a business relocation so let's look at some of the strategies and considerations that may clarify your decision. 

QUICK TIP: If you are already in the stage that you need to book in office removalists, ensure you book a team that is highly experienced in large office moves. 

No. 1

The Planning Process is vital

  • An exercise that can assist your decision making process is to implement an operational project management plan detailing expected benefits associated with a move of location. This plan might take into account projected increases in customer trade, sales or client base and customer traffic volume weighed up against comprehensive relocation costs. 
  • One of the major downfalls involving business relocations is lack of suitable planning. 
  • Inherent in the planning process is the necessity of a realistic timeline focussing on an expedient return to normal production or business activity
  • It is vital that in the planning process a realistic assessment of costs and a budget are included to limit cost overruns. 
  • It is imperative to maintain reliable and consistent communication with your current client/customer base during the relocation to ensure that loss of customers is minimised
  • It is of course vital that prior to relocating all relevant data collection devices are fully backed up to ensure that no loss of information occurs in the transition 
  • The project management plan should evaluate any significant consequences, positive or negative, that might result from the relocation
No. 2

What do we need for our strategic plan 

  • A realistic evaluation of start-up and moving costs
  • An in depth summary of the costs associated with the new location taking into account Government environmental requirements, other regulatory considerations, levies, rates, suitable power availability, water, other necessary services, transportation access for outgoing orders and incoming goods, accessible and adequate parking etc.
  • Consideration of whether leasing or renting is a viable option
  • An in depth evaluation of all viable alternatives to moving eg. building expansion
No. 3

Overall Relocation Plan Points to Consider

  • Will relocation result in cost reductions and if so to what extent 
  • Will relocation result in more usable space and can that space result in benefits or reductions in operational costs
  • Can relocation result in loss of key staff or labour shortages  
  • Are there government incentives or tax incentives available to help facilitate relocation
  • Are there government charges or levies that have not been assessed in the relocation
  • Will relocation result in a loss of clients or customer base or possibly increase the same
  • Will relocation result in a loss of key business supports

Business files in boxes with business chair in bubble wrap waiting for business relocation

Some more significant aspects to take into account

  • Business interruptions and delays in deadlines, loss of production
  • Possible need for increases in staff/labour due to business expansion
  • Are there advantages to relocation not yet considered, eg; more affordable office location that would not detract our business image or foot traffic (if you need this).  
  • IT risks in moving and in particular relocation and re-establishment of computer equipment including routing/cabling 
  • Data storage in transit and storage requirements after relocation
  • Office Removalists you engage should specialise in business relocations. This will make the process much easier and ensure you stay sane. 
  • Costs associated with removal and relocation of equipment
  • Inventory management during and after relocation
  • Productivity and quality assurance compromise during and after relocation
  • Making provision of additional operational expenses in anticipation of relocation
  • Ability of business and staff to adapt to new business space

In Summary

When it comes down to it there may be many positive points to relocating your business and if these outweigh the costs associated then there is every reason to go ahead. What needs to be clear is the reasons for the move that go beyond aesthetics to sound business judgement and responsible budgetary and fiscal oversight. Minimal disruption to business flow and efficient logistical supports should ensure such a move to be every bit a positive and advantageous strategic decision.