Purchasing or constructing an operational facility is one of the biggest decisions a business owner will make. And, of course, this decision will involve many specific characteristics of your business. Without reflecting on these characteristics through the prism of your overall business objectives, it’s easy for this decision to be lead astray.
Start by asking yourself:
- What do your workers need from your facility?
- What do your consumers or customers need from your facility?
When making your decision, you will take into consideration not just the size of the facility required to meet these needs, but the layout of the facility and how its design will meet your needs for all the business activity it will house.
Whether you’re buying, renovating or building a grocery store, a restaurant, lodging facilities, office buildings, industrial buildings, medical facilities, athletic structures or warehouses, your facility size will vary not just by the vertical, but by the particulars of your business and business activity within that vertical.
Here’s how to identify the facility size you need.
Step 1 – Identify functional needs
The first step to take when designing or purchasing a facility for your business is to lay out your operational needs to align the facility’s function with your long-term profitability. This includes thinking about:
- The interior layout. This refers to both the square footage and how it will be divided. How many floors would your building need? How many unique environments?
- Aesthetic details. What business atmosphere do you want for your building, and how should that be applied during renovation or construction?
- The exterior. What exterior look do you need to brand the facility to your business?
- Location. Will your facility be accessible to customers and close to the city, or does the countryside fit your business better?
- Additional required features. What size of parking lot will you need? Will you require loading docks?
To start organizing your facility needs into builder specifications, map out your operating steps. Even if you’re a business who’s been at it for generations and you’re upgrading to a new site to meet new demands, mapping operations out is how you can identify what requirements must be met with your new investment. Because, over generations, production or volume (or both) have changed.
To assess operational needs in a high-level way, answer the following questions:
- What departments will be part of the operation or production of your product or service before delivery to the client?
- Do each of those production departments work in silos, or do they regularly work hand-in-hand?
- What steps are taken in the regular operation for each department (or for the larger, multi-department effort)?
- How many employees will be housed in each area?
- What kind of (space-consuming) equipment will be used in each area?
Outside of production, you also need to consider auxiliary spaces designated for supporting departments at that facility, including:
- And others
With those questions answered, you can more easily visualize how your operations translate into facility needs. If this spacial “mental map” is still a challenge for you to see, your outline to the questions above will be exactly what a professional commercial construction firm can use to map your needs out for you.
Step 2 – Will there be customers?
An essential thing to keep in mind while making decisions for any business facility is whether you will have customers visiting the site or not. In particular, since retail and service businesses depend on customers coming in, they have to imagine the actual customer flow inside the facility. Ask yourself:
- What would ideal customer flow look like?
- How many customers should be able to navigate public spaces at once?
- What is the required size of the parking lot and number of ADA compliant spaces required?
Realizing that retail and service-based businesses vary greatly in their store size requirements, your facility decisions will also depend on your inventory or supply storage requirements.
Wholesale and manufacturing businesses, for instance, often require large premises, depending on the kind of machinery on-site. However, that still depends, once again, on the size of the activity itself.
Step 3 – Assess the adage “go big or go home”
Building or buying too large a space is a bad investment in just about every case. You lose additional capital up front, and it continues to trickle out in higher costs to maintain your facility.
If you are expanding a current business to a new facility, compare the use of your existing premises to the needs and standards you outlined above—then ask yourself how a bigger version of your current space could be optimized to meet your needs. That provides you a simplified mental blueprint for the new facility.
That said, for the company anticipating growth, buying or building big now is another strategy worth considering.
Continue reading if this is the case for your business.
Step 4 – Assess how much do you plan to grow in the coming years
Even companies not anticipating major growth should take into account an accurate assessment of their growth potential and business forecast before purchasing or building a new facility. Running out of space is another bad investment to avoid, which is why you should base facility size on your future plans, also. This will save you costs later by avoiding expensive redesigns or expansions.
If you’re concerned about the likelihood of your positive growth projections, or if your business model involves products and order fulfillment, consider performing a capacity analysis on your current facility. This is another practical way to estimate your business’s needs in the new space and into the future.
There are three types of capacity analysis related to this kind of business operation. Here, we’ll focus on the one that helps identify the space you will need for your facility: physical capacity. This assessment analyzes the physical space an operation has to house its inventory, systems, and processes. Often, the assessment is completed using modeling software designed to identify a better way of using space.
If you’re still working through your options for new commercial construction or the renovation or update of a purchased facility, Reliable Commercial will be happy to assist you in the process. Use this article as a worksheet and take notes on your answers to each of these questions. Hand that worksheet off to us, and we will consult with you to identify the optimal spacial needs for your operations and business facility to make the best of your investment.