Optimisation of Office Costs – Russia’s Hot Topic

Optimisation of Office Costs – Russia’s Hot Topic

In the business world, there’s a constant need to streamline services for greater efficiency and reduced costs

Russia is a market where office costs have been high on the agenda for some time, and one way of cutting them is with the flexible serviced-office model.  

Serviced offices allow a company to cut back on costs like heating, repairs, IT and telecoms – all of which are included in a flat fee – while also giving the option to scale operations up or down according to demand 

It’s this desire to cut costs that is one of the driving forces behind the rise in demand for flexible workspaces. A report by IWG in Russia found that by 2030, 13% of people working in the world’s most developed economies will be working flexibly. 

According to the real-estate advisor Jones Lang LaSalle (JLL), the flexible office market in Moscow grew by 84% in 2018. Despite this growth, flexible offices account for only 0.7% of the office market in the capital compared to 5.1% in London and 7% in Amsterdam. But JLL analysts forecast a growth in Moscow’s flexible office sector by 30% to 40% per year over three years, meaning it will effectively double in the next two to three years. 

The potential savings are huge  

Relocating to a serviced site outside the city centre is a great way to reduce costs. Global cities such as St Petersburg and Moscow capture the headlines but, with superfast broadband and cloud technology, there’s no reason why a company can’t be just as productive further away from the central business district. 

Not only are rental costs likely to be less at sites further out, there’s often also better parking and more green space – key factors in attracting new talent. 

A report by IWG found that up to 90% of Russian workers said that if they had two job offers, they’d more likely choose the one that offers flexible working, 24% said they’d prefer to work somewhere convenient rather than travel further to a more prestigious location and 60% said flexible working could improve their work/life balance. 

Consolidating your business in one site can reduce costs and increase productivity in other ways, too: it’s simple to add extra desks and IT to bring all your staff together from different offices.  

Indeed, reducing office space has been a key trend in Russia in the past five years. By only renting the space it needs, a company can reduce its real estate by 15-30%. 

One big cost uncertainty hanging over any company is that of repairs and upkeep of facilities. Whether it’s an IT disaster that leaves everyone offline or a leaking roof caused by a storm, not only can these incidents hamper productivity but they can also result in large repair bills. With serviced offices, these things are taken care of in the flat fee. 

And because running costs such as heating and air conditioning are also included, company can have total oversight over this part of its expenditure and avoid unexpected bills down the line. 

Find out whether IWG could provide flexible workspace for your company.