Business Operations: How Much Office Space Do You Need?

For any business, their commercial space is the centre of their operation. Whether it’s an office, retail space, industrial unit or any other type of property, there’s a lot that happens from this hub. From storing products, handling transactions, providing services, so much goes on here and needs to be managed properly.

In an office environment, remote working has provided a major shift in how businesses and people are working. While some have gone back to the office full-time, others have not, and a large number of organisations are working hybrid schedules with some workers in and others not at any given time.

This presents unique challenges as businesses look to grow in the future. Space is a premium and represents a significant cost to any employer, and using this in the best way will help improve costs, atmosphere and future prospects.

With that in mind, how much space does your commercial property need – both now and in the future?

Choosing Commercial Space By Numbers

The first thing to think about when looking at your commercial space – and whether it’s enough for your current needs as well as future plans – are the numbers behind it. This breaks down into three main options, which we’ll go into more detail with below.

These numbers are mainly geared around the office, and open plan offices at that, so for any other kind of commercial property, these numbers will need to increase. There are plenty of factors to consider beyond this, but the numbers are a good place to start. They can help narrow your choice of properties down to a more manageable list.

The Smallest Amount Of Office Space Per Employee

While this will vary, the smallest amount of space in an office per person tends to be around the 70-80 square feet. What this does is strip back individual furniture and space for equipment needed by a single employee for a setup that encourages closer working spaces. Desks can be swapped for benches, for example, and any storage can go under this piece of furniture to ‘define’ each person’s work area.

This is a common tactic used by businesses in a commercial space that costs more than average, whether that’s because of location or demand. New companies with limited funds might also opt for such a setup, as it also allows for more people to join the organisation without buying individual desks each time.

The Average Amount Of Office Commercial Space Per Person

On average, you can expect most companies to work to 100 square feet per person in the office. This includes furniture and equipment, with each employee having the space for what they need to work – but more importantly, work efficiently without feeling cramped or crowded. Creating an atmosphere that people want to be in helps productivity, and is a valid factor.

This amount of space represents the best balance between how much space a worker needs and ensuring there is space and a good atmosphere in the office for everyone to work in. It also provides flexibility in the layout of the office without being confined by too many people or rigid furniture.

Bucking The Trend

Of course, some companies choose a much larger office than they need for a few reasons. They might be planning ahead for future team members, but also to show that the business values people, their space and wellbeing. It can help in certain creative fields more than others, and getting the most out of these workers is a constant quest without overworking or overwhelming them.

You also need to consider communal spaces, meeting rooms and other areas that people need and use throughout their working days. More space does mean more of a cost, but the other benefits can far outweigh them.

Space Needed For A Retail Business

Unlike an office, where the numbers revolve around space per person, a retail space needs to change this formula to get an accurate figure. This revolves around sales per square foot, which you can determine from your sales projections and competitor and market research. This will change based on the industry and products you sell.

Take your projected annual income and divide it by the sales per square foot number and you will have an idea of how big your retail space should be.

The layout of your business matters, too. Too many products on display or for sale and there won’t be much room to move, meaning people have a less enjoyable experience. On the other hand, too much space can leave your store feeling empty, so finding a balance is just as important.

This doesn’t mean that’s everything. You’ll need office space, staff communal areas, storage rooms and more – and this adds to the size of the retail space you need. Location and cost also play a part, with costs rising depending on where you are and what you need to have.

How Big Should A Warehouse Be?

Compared to other commercial spaces, warehouses and industrial units need to be much bigger to store all the stock you need – or might need in the near future. While you won’t have to worry about customers in this space, you might need equipment and vehicles to move stock and pallets around, and this means more space.

The percentage of the space you can use depends on the products you stock. For example, 40% utilisation for products that can’t be neatly stacked – however, for products that do stack neatly, this goes up depending on how often you will take stock from the warehouse all the way up to 80%.

Work out the square footage of each pallet and multiply this by how high you can stock your products. This will give you a baseline number to start with, but you need to think about how stock will be organised, how it will be accessed and what space is needed to reach and remove it. With larger items, this either means less stock at once or a bigger warehouse to give people enough space to move things around as needed.

What To Consider When Looking At Office Space

With hard numbers to go by, you might be running calculations already and figuring out just how big a property you need for where you expect your team size to be in the future, but there’s more to think about.

The numbers do provide a guideline to help you get an idea of what you need, but the kind of business you have (and what you do) can mean you need more space than another company of the same size, for example. Even working out the numbers to the finest detail means you need more than you think to account for growth and free space that people need to complete tasks efficiently – while also ensuring the atmosphere and environment is as good as it can be.

The Type Of Office Or Workplace

The first numbers given above work best for open place offices, where space can be used more flexibly than other offices, such as cubicles or smaller, interconnected rooms. This means you’ll want more space per person for oddly-shaped offices or environments without this large open space.

The difference with other types of commercial property is that stock and products are also a consideration, as are the number of people or customers who are likely to be in the premises over a period of time. Staff numbers become less of a concern in these commercial spaces than customer numbers or stock areas, as this is where revenue and profit will come from.

The Equipment Needed For Employees To Work

Every business will require equipment of some sort to operate. Whether that’s a series of desks and computers to more hands-on equipment, such as those for creating and producing goods of any kind. This all takes up space, which needs to be accounted for when looking at any commercial space.

In an open-plan office, the numbers can take into account desk furniture and space needed for each employee, however this will vary from business to business. Having extra space will never be complained about, but if this reduces over time, it’s important to have open conversations so employees understand what’s going on.

Increasing The Number Of Employees

Growth is a goal of most businesses, as it has the potential to increase revenue, profit, stability and authority in the industry and local area. The pros are obvious for all to see, but behind the scenes, growth often means a bigger team – and they need somewhere to work from. While hybrid working schedules can help with how many people are in the workplace at once, this will catch up to employers at some point.

For commercial spaces that are too small, even a rotating schedule won’t help forever, but on occasions where more workers are needed than usual, it will feel very cramped and crowded, which is not a good atmosphere that encourages efficiency.

Work Schedules And Patterns

As mentioned a few times now, a number of businesses have adapted to remote working options even after the requirements for them ended. In many cases, this has resulted in hybrid working patterns becoming more normal, with some time spent in the office and the rest elsewhere.

This has to be agreed between employer and employee, as everyone benefits from different working styles , and getting the most out of a team might mean some people in the office more than others, and other teams spending more time away from it. When growing a team, this will play a part in determining the people who want to join the business and how many you can feasible accommodate at the time.

Planning For The Future With Your Business Space

Before changing your commercial property for a new one – whether larger, smaller or just in a new location – it’s important to think about what you expect in the future. How you plan to work now, and what this might look like in the future, can alter which properties will suit your needs.

This is a complicated picture, as things can change quickly but with more people you need more space. Even with hybrid working, there needs to be room for anyone to be in the office when they need to. Scheduling helps, but there’s a lot to keep in mind. The team at Williams Sillitoe can keep this in mind when helping you find your next commercial space, so get in touch with the team to get started.