Office Fit Out Budgeting
Just 1 in 3 construction projects finish within 10% of their original budget. Unfortunately, office fit out is no different. A huge percentage of fit out projects finish late and over budget. This is very frustrating and damaging for companies.
Every week, we speak to companies planning an office fit out. Many are very wary due to previous negative experiences they've had with fit out companies. If you're preparing for an office fit out, one of your biggest concerns will be keeping your project within budget. In this article, we'll go through 5 key ways that you can ensure you complete your office fit out within budget. By the end, you'll know how to plan and prepare for your office fit out in such a way as to finish it without cost overruns.
Define Your Brief
Without the right brief in the first place, you can't even set the right budget at all, let alone keep your project on budget. If it doesn’t solve your workspace issues, your project will not be a success, no matter how cheaply it was delivered or how good it looks.
There are 3 key elements to a great office fit out brief. The first is workspace strategy - how your people work, and the role your workspace plays in the future of your company. Project objectives identify 3-5 clear goals by which to measure project success. You'll also need to include everything you know about your current space and details about any other requirements. To learn more about creating a brief for your project, read this article. It explains everything that needs to be in your office fit out, and how to create a great fit out brief.
Set the Right Budget
To deliver your office fit out on budget, the budget has to be right in the first place. Trying to deliver without sufficient funds will mean you have to cut corners or miss parts of the brief. Overbudgeting will lead to an unnecessarily expensive, which is a waste of money. Both situations leave your company worse off as a result.
So how do you decide on an appropriate budget for your office fit-out? It’s a good idea to start by estimating what it will cost to deliver your office fit out as per your brief. This will prevent you from picking an unrealistically high or low number. You can then compare this with what your company can realistically afford. It's also important that you consider the benefits that your office fit out will bring over the long term.
No two fit out projects are the same, so we can't say exactly what your project will cost. Most office fit outs cost between £65 and £160 per square foot. The cost of your fit out will largely be controlled by the size of the space and the specification of the materials used. The state of the space, the extent of services works required, and the location of your project will also affect what your office fit out will cost. To learn more, read How Much Does an Office Fit Out Cost in 2024?
Value Engineer
For some companies, the cost of delivering the office fit-out on-brief is more than they can afford. Regardless, it is always good to make sure you are maximising your value for money. Once you have a full project quotation from your fit out, you can work with them to refine the brief, specification, and design package. This will maximise the ROI of your office fit out.
The first thing to do is review your brief, and see if all of it is necessary. By considering separating the needs from the nice-to-haves, you may be able to bring your project within budget without damaging staff productivity.
Some elements in your workspace, such as lighting or ergonomic furniture should not be down-specified if at all possible. This is because cheaper options can cause your staff health and productivity issues. Other areas can provide cost savings that have little impact on the performance of your people. One common way to reduce the cost is to reduce the quantity of partitioning, as this requires costly electrical and plumbing adaptions.
Fixed-Cost Contract
Once you’ve agreed on your brief and budget, sorted the design, and signed the contract, the last thing you need is to be hit with a long series of mid-project price increases. We’ve had companies come to us following terrible experiences with well-known design and build companies.
As soon as the contract was signed, they were submitting price increases. They had created an amazing design, but only quoted for half of it in order to meet their budget. They were then charging the customer inflated prices for mid-project variations. Sometimes though, office fit out companies sometimes simply haven’t allowed enough contingency for the regular cost increases of raw materials.
At Zentura, we understand how unexpected cost increases can derail office fit outs for companies. We operate a fixed cost policy, which means you pay what you expect to, with no hidden extras. Missed or miscalculated costs are our problem, not yours. Having trust in your office fit out company, and making sure you understand the project contract is essential so that you can avoid your project running way over budget.
Set a Contingency
Even if you’ve set the right budget for your brief and are working on a fixed-cost contract, you still need to add a contingency to your project budget. Fixed cost policies are designed to assure you that you will get everything on the quote at the initial cost. It will not cover unforeseen circumstances or changes that you request during the project. Office fit-outs have thousands of details, and it's almost certain you will want to change something at some point!
Most projects require a 5-10% contingency. If you have set a good brief and budget in the first place, you should be able to set a contingency at the lower end of this scale. The longer and more complex the project is, the higher the contingency will need to be. Of course, your objective is to spend as little as possible of this contingency, but if you do need to change something after the contract has been signed, you can do so without having to run over budget.
Keeping Your Fit Out on Budget
You now know about the 5 essential steps to making sure your office fit out doesn’t suffer cost overruns. As a result, plan your project and manage it to ensure it doesn't finish over budget. As a result, your project will be a lot smoother, more successful, and less stressful.
If you're going to keep your office fit out on budget, your budget must be right in the first place. To help set the right budget, download your Office Fit Out Cost Guide. There, you'll learn everything you need to know about the cost of your office fit out, including common costs, what affects those costs, and why some fit out companies are more expensive than others.
Equally important is giving your fit out company all the information they need to create an accurate quote in the first place. To do that, read How to Create an Office Fit Out Brief. There, you'll learn about everything that goes into an office fit out, and how to bring a great brief together.
