Location, location, location
You may or may not know that McDonald’s, one of the world’s biggest fast food chains and a multi-billion dollar corporation — doesn’t make its money selling burgers. When you peel back the layers, what you’ll learn is that they’re actually one heck of a real-estate company. In fact, former McDonald’s CFO Harry J.Sonneborn was even quoted saying:
“We are not technically in the food business. We’re in the real estate business. The only reason we sell fifteen cent hamburgers is because they’re the greatest producer of revenue, from which our tenants can pay us our rent.”
Location, location, location. You’ve heard it a hundred times before. But it’s not just McDonald’s that benefits from a focus on location. The modern working landscape has shifted tremendously in the past few years — and what may not have mattered to a pre-pandemic commuter —spending 4 hours a day on a train to and from the office — matters now.
Companies can benefit tremendously by rethinking not just how they cater to their employees, but where they do this. As more and more companies consider consolidating their offices and adopting the “satellite” work model, it’s even more critical to rethink location. Whether you’re a company of 10 people or 1,000 people — it’s key for you (like McDonalds) to think about how you’re best serving the people who help you bring in your bottom line.
John Matox at Gartner says that, “Talent-first strategies will drive long-term business resilience and competitive advantage.” What this means is making people central to your decisions about where you position yourself. Do the majority of your employees commute long hours? Could suburban satellite offices be more beneficial than urban ones? What are your employees’ lifestyles like? How can we rethink real-estate based on the employee experience?
Traditionally, location decisions are driven primarily by cost — while people take a back seat. But people need to be at the forefront of every decision — and location matters today more than ever. Most of us never want to return to the long commutes of yesteryear, but still crave the community feel and collaboration that comes with being in a physical space together. Today, location has taken on a new meaning: It’s all about proximity to your people.
Here are some factors to consider when you’re rethinking your location strategy:
Meeting Your Employees Where They Are A study found that German companies saved $20 billion on business travel in 2020. As companies around the world moved to a remote-work model, business travel was replaced by zoom meetings — and distance was no longer a factor. But employees don’t have to meet virtually for companies to save costs today. The satellite office model brings with it the ability for companies to strategically position themselves closer to home for employees, while offering a multitude of working options for a distributed workforce. Geographical proximity to your employees can be a major competitive advantage, and help increase your bottom line.
People First Strategies are More Cost Effective The challenge of cost never goes away, but the good news is that a people-first location strategy is more cost-effective. When you consider how you serve your talent, and position yourself in locations that better cater to employees, you automatically increase productivity and by proxy, reduce costs. Not to mention, satellite offices are generally cheaper than your standard 5-10 year long-term space leases.
Think Long-Term Having good talent is great, but hiring can be hard, and retention is even harder. Think about how your locations are serving your hiring needs. In-person interviews aren’t completely in the past — and having convenient spaces where prospective employees can connect with current team members can be a great way to hire and bring in strong people.
Simply put, your location strategy matters — and location is a valuable asset in today’s ever-changing workplace landscape. Every company needs to think about how they adapt to a changing workforce and meeting team members where they are while offering all the perks is the best way to stay competitive.
For more content about the future of work, check out some of our other articles on veeryoffices.com/blog or follow us on social media @veeryoffices.