Business owners worldwide choose to renovate their commercial buildings from time to time. This is because old and outdated facilities can ruin a brands’ reputation and may even cause its customers to leave it for their competitors. On top of that, business owners who do not maintain an updated facility may encounter problems with the building’s maintenance and cleanliness. Over time, these maintenance issues can make business operations inefficient, costing them hundreds and thousands of dollars.
Research has shown that a fresh and updated look to a commercial space can draw in more customers, improve employee performance, and create more efficient use of space. Not to mention, the right type of renovation and remodeling can also help facilities become more energy efficient. However, despite all these benefits, some owners still believe that renovating is a huge expense and will not pay off in any amount of time, no matter what.
For this reason, in this blog, we discuss how you can calculate commercial renovation ROI. Calculating ROI will help you determine if your commercial renovation project is a good investment or an unnecessary expense.
Calculating Commercial Renovation ROI
Calculating commercial ROI can help you determine if renovating your business will be a worthwhile expense. Here’s how you can calculate it:
Set A Goal
Business owners renovate their buildings for various reasons. They may want to do it to attract more customers or improve efficiency around the area. But whatever the goal is, understanding and knowing it can help them determine when the project is a success.
Two of the most common goals that business owners have when they start their renovation project include:
Attract New Customers: A modern and updated commercial building will undoubtedly bring new customers into the building. This is because, in today’s world, customers not only look for the best products and services, but also look for an overall experience where they can enjoy their time while shopping, eating, and more. An old, unclean and outdated commercial space will surely not provide them with that experience, and they’ll drive away.
Improve Efficiency: Old commercial buildings are energy inefficient, space inefficient, and are poorly built on designs that are bad for the productivity of the business and its employees. Therefore, renovating your space could decrease your energy bills, increase employee performance, and make an efficient use of the space.
Quantify The Cost
Determining the cost of your renovation project can be a lengthy process, but it can help you calculate your ROI. The simple way of determining the cost is by consulting a professional general contractor. The right contractor will look at your project’s needs, budget, completion time, and other aspects to give you an estimate which you can then use to determine your ROI.
Perform Market Research
Once you have determined the cost and goal of your renovation project, the final step of calculating your ROI is to perform market research. Market research can help you determine if the type of renovation you want for your specific business is going to be successful or not. It can also help you determine the best operation payback and the value of the project.
While doing market research, ask yourself the following questions.
- How much will this project increase business efficiency?
- How many new customers will you gain as a result of the renovation?
- How much will your business grow because of this project?
Knowing the answers to these questions can help business owners determine whether the cost of the project will be worth it or not.
About BelVan Construction
BelVan Construction is Edmonton’s leading commercial general contractor. At BelVan, our highly qualified, trained, and experienced team makes sure that your commercial construction projects are dealt with as efficiently, responsibly, and reliably as possible.
We offer various businesses expert general contracting, project design-build, pre-construction consulting, and construction management services throughout Alberta, Saskatchewan, & BC. For more information, visit our website, or contact us here today.