What is office downsizing? Introducing its advantages and disadvantages!

Hello!
This is Shimojima, a writer.

In this article, we will introduce the advantages and disadvantages of downsizing a company's office, as well as the cost of downsizing an office.

We will also introduce useful features in Colorkrew Biz.

Benefits of Office Downsizing

First, I would like to introduce the benefits of office downsizing.

(1) Reduced Office Rent

Unlike in the past, when going to the office was the norm, when the opportunity to come to the office by telework decreases, extra space is created that is not used.

If you can move to a smaller office than before, you can reduce the rent that used to be spent on the office.

In one company, the rent has increased from 5 million yen to 1 million yen per month.

(2) Reduced Utility Bills

Introducing telework will reduce utility bills because all employees will not have to come to work every day.

A general example of the average market price of utility bills is as follows:

• The average monthly utility bill for an office of about 40 tsubo with about 15~30 employees is around 40,000 yen.
• The average monthly utility bill for an office of about 80 tsubo with about 70 employees is around 80,000 yen.

It is said that it can reduce about 500,000 yen ~ 1 million yen per year.

(3) Reduction of employee transportation costs

By reducing the number of days you go to work by teleworking, you can reduce your employees' transportation costs.

If you calculate the monthly regular fee for one employee to come to work from Yokohama to our company's Shin-Okachimachi, it is 63,100 yen for 3 months, so it is calculated that the transportation cost of one employee can be reduced by 252,400 yen per year.

It is also possible to use the money you have to use to fund your employees' study or to hire new employees.

(4) Transition to free address and hybrid work to make it easier to create new offices

When the office is downsized, it will be easier to transition to hybrid work, where there is no fixed seat in the company or where you can work from any location.

If we can move to a free address and work from a different seat every day, we will be able to create new interactions with employees that we have not interacted with before.

If you can move to hybrid work and work in a place where employees can work, employee satisfaction will increase.

Disadvantages of Office Downsizing

When considering downsizing an office, there are naturally disadvantages.

(1) Costs due to office downsizing

When you downsize your office, you have to pay for everything.

To give some specific examples,

• Cost of restoration work such as wallpaper and flooring of the office you are currently renting

• Office Size
  Small and medium

• Unit price per tsubo
  2~50,000 yen

• Office Size
  Large-scale

• Unit price per tsubo
  5~100,000 yen

(*This is the cost market for general restoration work.) ）

• Printing and shipping fee for office relocation greetings is about 1~20,000 yen.
• Agency fee for reporting to the tax office, legal affairs bureau, and public health center is about 10~200,000 yen.
• In addition, penalty fees due to cancellation of rent for about 3~6 months

And so on.

There are also various costs associated with moving to a new office.

• Rent 6 months ~ 12 months rent and key money.
• Brokerage fee for 1 month of rent from the real estate company.
• Interior construction cost about 200,000 yen ~ 400,000 yen.
• Moving costs to transport employees' computers and desks are about 2~50,000 yen per employee.
• Network construction cost is about 50,000 yen.

Other expenses for purchasing equipment for employees are also considered.

(2) Concerns about a decrease in employees' motivation to work

Office downsizing is an advantage for companies, but it can also be a disadvantage for employees.

That is, the acceleration of the flow of cost reduction leads to distrust in the company's direction and a decrease in motivation to work.

It is important to clearly show employees the direction of the company.

In addition, creating a comfortable working environment, such as creating café spaces and relaxation spaces where employees can interact with each other, will also help prevent a decrease in motivation to work.

What You Need to Succeed in Office Downsizing

When considering office downsizing, careful planning is required.
Here are two key points.

(1) Clarify the purpose and impact of office downsizing

The first important thing is to be clear about the purpose of office downsizing.

• Is it a long-term office downsizing in preparation for the spread of the new coronavirus and possible earthquakes and disasters in the future?
• Will the office downsizing increase employee productivity?
• Will office reduction make it harder to work?

Set clear goals and proceed with office downsizing.

At that time, it is important to create a comfortable working environment while listening to the opinions of employees.

If you can use not only telework but also co-working spaces and shared offices, there will be no complaints from employees such as "the office is the only option other than telework".

(2) Plan for Office Downsizing

Once the purpose of office downsizing is clear, it is necessary to make a detailed schedule.

In general, it is said that it is best to plan for office downsizing at least six months in advance, so proceed with plenty of time to spare.

About one month before moving to a new office, you must arrange for communication equipment construction such as in-house telephones and networks, interior work on the office, and notification to the tax office, legal affairs bureau, and public health center.

3 Useful Features of Colorkrew Biz

Colorkrew Biz has features that can be useful in office relocation.

Figure out whether to work in the office or telework at a glance!

When office work and telework are used together, the problem arises that you don't know who is in what situation.
The seating chart function solves such problems.

QR codes can be used to operate office commuting, telework, going out, vacation, etc., and the status of employees can be grasped both inside and outside the company.

Using the dashboard function, you can easily view the status of each employee in a list.

Communication between remote and in-office employees is easy with Microsoft Teams!

When telework and office work are used together, it becomes difficult to communicate with each other.

That's when Colorkrew comes in handy, thanks to the integration with Microsoft Teams.

You can select a person by selecting a seating chart or search to narrow down a person, and you can start chatting with that person right away.

Seat lottery function that allows you to freely choose a seat with a free address

When you introduce a free address, you tend to choose a seat you are used to.

In such cases, the seat lottery function is convenient.

"Where to sit today?" will be decided by lottery by the Colorkrew Biz app.

This feature allows you to interact with a wide range of people, which is the original purpose of free addresses.

Conclusion

We have introduced the advantages and disadvantages of downsizing a company's office, as well as the cost of downsizing an office.

Shrinking your office can reduce company costs, utility bills, and employee recurring bills.

On the other hand, there are also disadvantages such as cost burden such as restoration work costs and moving costs, as well as a decrease in employee motivation to work.

It is important to proceed with office downsizing in a planned manner while incorporating the opinions of employees.

Colorkrew Biz offers features that will help you after downsizing your office.

If you are interested in a company representative, please contact us!

We will respond to any consultation.