Getting your space right can affect everything from the productivity of your employees to the type of customers you attract – and your ability to retain them. So here’s the low-down on everything you need to know for fitting out a new commercial or retail space.
Choosing the right contractors
“Be sure to contact professional industry associations for referrals. Professional fitout and design companies usually join their industry organisation and are proud to be members. They generally have both the required experience to do the job and have a strong commitment to the industry’s Code of Ethics,” explains Gerard Ryan, CEO of the Australian Shop & Office Fitting Industry association (ASOFIA).
Part of that process, according to Mr Ryan, involves determining your budget as well as preparing a clear, concise project brief with ideas and examples of what you are hoping to achieve to share with the contractors you approach.
He says that while virtually all contractors can undertake any job, many will specialise in a particular type of fitout.
“It is a little bit like a hairdresser being able to cut anyone’s hair once they have completed their hairdressing apprenticeship,” he says.
“Having said that, the industry does tend to specialise and contractors often gravitate towards particular niche markets. For example, food fitouts are often more specialised than a fashion fitout, and different companies have preferences as to what type of work they like to specialise in.”
He adds: “Also, as you might expect, if you do pretty much the same thing all the time like office fitouts or pharmacy fitouts, you become very good at it and extremely competitive.”
Logistics of a design project
There are plenty of factors to cater for when embarking on a fitout project. Budget is the most obvious and, of course, it is prudent to allocate funds to cover the works in advance to ensure the project is kept on track.
Mr Ryan suggests that it is unwise to try and base costs for the work on domestic works or kitchen installations, given that commercial contractors actually work under vastly different conditions.
“Fitout contractors often have large factories and huge investments in plant and equipment, [and] are heavily regulated and have extensive compliance requirements for workplace health and safety and site access,” he explains.
“[They also] are working lots of after-hour work at night and on weekends and have significant overtime expenses, [and] are burdened with unbelievably short time frames to complete the fitout work.”
Aside from the actual costs of the project though, businesses may also face less tangible considerations.
For example, consider the impact it will have on your business operations. If you plan on project managing the work yourself, who will take over your role within the business to keep it carrying on? For a re-fit or undertaking work post-relocation, will your business suffer interruptions or reduced productivity during the work?
In this instance, consider also that noise, dust and temporary power, phone or water disconnections could affect both the well-being of employees as well as the reliability of phone and email connectivity.
Building works restrictions
Of course, there are some restrictions on what can be done during a fitout project. For example, heritage-listed properties generally require both council approval and the use of specially recognised heritage builders to carry out works.
Additionally, signage may require DA approval from the local council prior to work commencing.
For many businesses, particularly SMEs, which are more likely to rent premises, the terms over the lease of the property may also come into question.
Sarah Hughes, the manager of tenant advisory occupier services at Colliers International, says it is important to determine before signing a lease about what is included in the premises and any special provisions proposed by the landlord.
“Recently, a tenant taking a suite with a speculative fitout was not provided with a clear and concise inventory list. Following lease execution, they discovered they actually required additional capital to ensure the premises were in fact operational,” she says.
“This is a case of always checking the fine print – ensure the lease plan matches the inventory list. Ask questions and request invoices to support the inventory list if you are still unsure.”
Ms Hughes says that while some premises may come with an existing fitout, if this is not suitable, the tenant should make sure that the landlord bears the cost of removing this fitout as well as assuming responsibility for any damage caused during this process.
“A tenant should understand their business requirements and how this translates into space. We recommend undertaking a space analysis to determine the optimal size based on their specific requirements. An analysis can be undertaken by a designer, space planner or architect,” she says.
“It’s also important for a tenant to undertake test fits before signing a lease proposal or heads of agreement – a tenant needs to know sooner rather than later whether the space can actually work for them.”
When it comes to other modifications, Ms Hughes says that tenants are responsible for footing the bill.
“All internal partitioning, alterations and/or modifications to the premises will be at the tenants’ cost and is subject to the approval of the landlord. The cost of fitout can range from $750 per square metre to $2,500 per square metre – you get what you pay for and it’s important to remember that the devil is in the detail.”
She also advises that when vacating premises, tenants are generally required to return it to its condition at the beginning of the lease.
Effects on branding
As well as the physical elements of a fitout, independent branding specialist and Shine academy founder Sue Currie says that your workspace can have a big impact on your brand appeal.
“Planning office design to me is as important as brand communication collateral,” she explains.
“When a customer walks through your door – that first impression has an immediate impact.
“Luxurious furnishing and fittings, expensive art work on the walls and a city view would say, ‘We are top of the line and service high-end clients’. So if that is the type of client you are wanting to attract, I’d say reflect that in the office surroundings. Alternatively, if seeking that type of client, a bland office with cheap office furniture would not assist client attraction.”
As such, it is important that your workspace reflects not just simple utility. Particularly if it will be a place where you receive customers or meet with suppliers and partners, your premises should carefully align with your brand and be tailored to the type of customers you want to attract.
Suffering an anti-climax
Sadly sometimes things can go wrong, meaning what you planned and paid for is not exactly what you end up with.
“As shop and office fitting is a commercial activity, some of the state government consumer bodies only concern themselves with those mums and dads who generally deal with domestic builders, so they don’t generally get too interested in commercial disputes,” Mr Ryan points out.
“That may differ from state to state. Every state has a different licensing regime, despite attempts a few years ago to develop and implement a system of national licensing through COAG.”
Mr Ryan says this means the main recourse for anyone unsatisfied with their fitout will have to revert back to the terms of their written contract.
“ASOFIA has developed an industry contract that is fair to both parties – the client and the fitout contractor. In the association’s contract, there is a dispute resolution clause that allows for any dispute that arises that is unable to be resolved within seven days can be referred to independent arbitration or mediation,” he says.
“ASOFIA also has a code of ethics that members commit to when they join the association.”
A commercial fitout involves a lot more than simply slapping a new coat of paint on the walls.
Accordingly, due planning, budgeting and preparation is required to ensure that not only you end up with a great fitout, but that your business does not suffer adverse effects – either while the works are carried out or once they are completed.
Choosing a reputable contractor
• Determine if licensing is a requirement in your state or territory and, if so, do a licence check on the contractor.
• Check to see if they are members of their industry association.
• Consider doing a credit check to determine their financial viability.
• Seek details of referees and speak to them about their level of satisfaction with the contractor.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.
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