How Much Should a Company Spend on Office Furniture Per Employee?
Being the CEO of your own successful company is undoubtedly a dream for many, but when picturing yourself reclining in the luxury seat of your private jet, perhaps the echoing voice of Eric from Accounting will make you feel surprisingly grounded. Like an air balloon rising with serious ballast issues:
“Boss, wouldn’t it be great with a small library section for impromptu research? And can we get some orange and lime Post-its to go with the yellow and pink ones for extra creative brainstorming?!”.
Now you might be thinking, “surely, that has to be somebody else’s job”, but unless your operation is big enough for you to hire an office manager, it really isn’t. You’re the decider in charge of giving shape to the company in every thinkable aspect.
When this perhaps unwelcome truth finally materializes, you are going to need an educated answer to the question: “how much should a company spend on office furniture per employee?”.
In a 2014 article on OPI.net, writer Jack Francis stated that startups in their infancy spend $1,844 per employee annually on office products - about 50 % of which are consumable office supplies like paper, pens, computer ink, etc.
This amount chimes in well with Quora-listed numbers revealed by HavenCo founder Ryan Lackey, whose experience in building larger companies has led him to a budget of $1,500 per person for furnishings - of course that includes buying with bulk discounts.
Your desks and chairs will be used 8 hours a day, 5 days a week, 48 weeks a year, totalling 1,920 hours annually. While Americans on average spend $9,000 on cars that are used only 600 hours a year, many find office furniture prices steep, while others completely forget to factor in this cost when projecting company investments altogether. Why is that?
Startups are expected to be scrappy bootstrappers, hacking away in keg-fueled man caves.
Amazon famously used $15 Home Depot doors as desks in their infancy and have been applauded for this makeshift approach as office interior is often seen as contextual, i.e. secondary to the fiery mission of a new company’s product development.
Now, the tide is turning, and office workers demand work tools reflecting their valuable time and coveted qualifications. Startups need a 360 degree investment thinking on all fronts. In more ways than one, cheap now might turn expensive later. So the answer to the initial question about furniture costs becomes inextricably linked to the solutions at hand.
If you want to buy, products can be had at roughly three tiers of different quality, warranty terms, and design benefits. IKEA’s “Bekant” elevation desk comes at $419, Herman Miller’s Motia model sells for $1,200 while high-end design manufacturers such as Danish market mainstay Montana delivers their HiLow2 desk for $1,725.
But what if you were to approach the question differently. Companies rent their office space because the lack of long-term viability assurance is linked to the lack of funds. Luckily, an office lease can always be cancelled - or extended. Surely the same flexibility logic should apply when outsourcing the issue of office furnishings to best practice professionals.
ProjectionHub took a look at 630 startups that had built furniture expenditure into their projections and calculated an average startup cost for office interiors of $21,000.
That is a big down payment for a young company that, according to Lackey’s metrics, consists of only 14 employees.
Subscription furniture would therefore be a godsend, especially in the first 12 months, as they give you some much needed flexibility, while providing you with state-of-the-art designs that will leave your co-workers proud and inspired, setting your company apart from the gray norm.
Maybe that would even retrieve some of the $450-550 billion that a USCDornsife study from 2015 claims is lost annually, when unmotivated employees lag behind in productivity, because it should be no mystery that your environment influences your output.
Most importantly, the operational flexibility will allow you to make the relevant changes as you go. Whether to extend, replace, return, or buy your subscription furniture, you can now decide as you grow.
By all accounts, those Home Depot doors did not recover much when eventually replaced with quality desks - as Amazon happily realized they were in it for the long haul. Why not set out with that assumption, and work accordingly. In agile, elevating, and self-assuring designs, reflecting the amount of time and effort you ask of their human users.