Have you taken the time to read our previous article, “Eleven Ways Your Business Can Save Money by Using Remote Employees“? In it, we discussed the potential for improved profitability that can be achieved by enabling employees to work from home. Additionally, we outlined how easy it can be for you to find the very best talent simply by getting in touch with us.
Working from home has a range of long-term benefits. When the majority of staff can work remotely, the need for a physical workplace is greatly reduced, or even eliminated altogether, resulting in a drastic decrease in operational costs associated with running an office.
Whilst financial calculations play an important role in assessing the benefits of a venture, there may be other factors which should be considered to measure the return on investment. For example, the reputation of the brand may be enhanced by the venture, or there may be increased public praise for corporate social responsibility efforts. Although these can be harder to quantify, they can still be just as valuable.
In case you still need convincing that remote work is the way to go for your company, consider these other incredible cost-savings opportunities.
- Get rid of the need for fancy office space As a business, the cost of renting physical office space is one of the most significant expenses. Property is currently one of the most sought-after commodities in the US, and the cost per square foot of office space varies greatly across the country, as the image below demonstrates. A worker’s office space may cost anything from $1.74 to $6.16 per square foot, per annum, resulting in an average of $14,800. However, if a cap of $5,000 is set on this expenditure, then this data visualisation provides insight into the current market value. With the arrival of remote working, the cost of physical office space is no longer a necessity. Thus, the expenditure can be eliminated, allowing businesses to reduce their overhead costs.
Average office rents in the most populous American cities in 2023
- Not having an office means not having to pay for an office’s worth of utilities. Water, heating, electricity, waste disposal, recycling and Wi-Fi are essential services that all commercial premises must provide. Although landlines may seem outdated, they still have their uses and can be beneficial, especially for those who appreciate a sense of nostalgia. According to recent research, businesses based in the Mid-Atlantic region of the United States typically pay an average of $722 per month for their electricity.
- It’s no picnic to shell out cash for a parking spot at a business. If no one is coming into the workplace, there is no need for the parking lot. Even the restrooms and kitchen will not be necessary. All of the items in the buildings, elevators, toilets, stairs and freshly cut grass do not belong to you. Although your lease may include a monthly fee for the upkeep of shared areas, you may also have to pay for more costly improvements such as new windows. This can be a huge strain for a small business owner, as an unexpected cost of £5,000, even when shared among all tenants, could be devastating.
- Reduce or do away with all office expenses. Every company has a range of overhead costs that must be taken into account, such as computers, printers, salaries of non-revenue generating staff (such as janitors and maintenance workers), and office lunches. While some of these costs may be tax-deductible for a small business, they still need to be paid. The Operational Expenditure Ratio (OER) refers to the proportion of revenue that is used to cover operating costs. Working from home may reduce operating costs, but it will not completely eradicate them. If you were able to reduce your OER by just half, it would result in a noticeable increase in the profits for your company.
Corporate Giants Have Saved Millions by Eliminating Office Space
- Tax rates for companies will be drastically lowered. Small companies, like any other kind of organisation, must comply with a range of taxation types. Fortunately, the Business Property Tax, which is based on the value of the property, is no longer pertinent as the company is now operating remotely. Furthermore, the value of the space in your home used for business purposes can be deducted from your taxes. Additionally, those who do not have to commute for the business may be exempt from paying the Excise Tax.
- Scale up your company with little added costs. If you opt for the traditional course of expanding your business, you will eventually have to pay for more premises or land, as well as the construction and associated costs, such as security and ongoing maintenance. This will have an ongoing impact on your finances. It can seem as though the world is punishing your success. An alternative, more cost-effective solution is to employ staff remotely. By doing so, you can hire as many individuals as you like without the need for additional expenses, apart from the one-off cost of adding them to your remote project management software.
Positive Effects of Telecommuting on Your Company’s Social Responsibility
Corporate Social Responsibility (CSR) is an extremely important consideration for businesses of any size in the current climate. Even if it is not feasible to formally include remote working as part of your CSR strategy, it can still help to make your company more ethical. This can ultimately position your business as a more forward-thinking organisation, which can help to attract the best employees and reliable business partners. According to the 2023 Robert Half Technology Salary Guide, 34% of employers offer telecommuting and 62% offer flexible scheduling.
- Work that can be done from a distance really benefits local economies and helps bring people together. When you are not confined to recruiting within your local area, or when your employees no longer face the pressure of a lengthy journey to work, there is the potential for great opportunity. Rural and suburban localities may be an excellent source of qualified candidates. Once they are hired, they become legitimate taxpayers in the area, which in turn stimulates economic activity due to their expenditure at local businesses. Those who work remotely do not need to leave their rural homes to travel to cities, which helps to reduce population growth in rural areas, as well as contributing to their expansion and development.
It’s possible that a sustainable future may be achieved via remote work.
Telework Research Network, the Image’s Creator
- Working from home benefits the environment. As a result of fewer people travelling to work on a daily basis, we can expect to see a decrease in the amount of oil consumed, fewer greenhouse gases being released into the atmosphere, a reduction in the amount of traffic congestion and a decrease in the wear and tear on roads. The Traffic Research Network (TRN) has stated that for every vehicle taken off the roads, traffic congestion is reduced by a factor of three. This domino effect of remote working is quite remarkable; for instance, if people were to reduce their paper use, it would be enough to offset the emissions of 279,000 motor vehicles and the waste produced by 44,000 garbage trucks.
- Benefit in several intangible ways. It is hard to calculate the exact financial value of all the advantages that remote working can bring to businesses. A company could see a significant return on investment (ROI) as a result of these changes. According to the 2023 report, “The State of Telecommuting in the US Employee Workforce”, there are also some intangible benefits associated with telecommuting, including but not limited to.
- Increase the available pool of workers and help fill skill shortages.
- Make the most of available space
- Improve your company’s adaptability
- Minimize the time spent travelling to and from meetings
- Find ways to get your employees more involved
- Minimize the expense of technological advancements.
- Reducing Employee Stress
- Lessen the tension between work and personal life.
- Put a stop to the brain drain
- Boost originality and imagination.
- Value output over attendance when evaluating workers.
- Save on filing cabinet space by cutting less on paper.
- Spread out without extending their impact on the world
- Reduce or remove funding for parking and public transportation.
- To keep from incurring environmental fines and compliance expenses
- Aim to be recognised as an employer of choice.
- Find options for accommodating parking shortages
- Improve the company’s public profile
It is time to consider the advantages of remote working for your organisation, whether it be for financial incentives or to demonstrate greater social awareness. Do not be under the impression that this is a passing trend, or that it applies only to larger companies, as the findings of the 2023 report on telecommuting in the American workforce show that medium-sized businesses are 75% more likely to offer remote working as a full-time (8%) rather than a part-time (2%) option.
It is clear from the data presented and from our previous report that the current situation is very advantageous, and your peers are already experiencing the advantages. Therefore, we would encourage you not to delay in making contact with Works, so that we can begin to move forward.