Total Contract Value: The True Cost of an Executive Office Suite
Every business owner is constantly searching for ways to cut costs and boost their bottom line, but small business owners and entrepreneurs need to be particularly good at getting the best deal. If you are on the hunt for an executive office suite, you are probably comparing the amenities that executive suite providers offer or the price of renting an executive suite for your desired timeframe.
However, it’s not as clear cut as some may think. Some competitors will charge you hidden fees at the end of the contract which can quickly add up. Thus, it is important that you compare executive office providers by determining the Total Contract Value (TCV).
What is the Total Contract Value?
The Total Contract Value is a metric that represents the total cost of your contract over the length of the agreement and factors in both one-time and recurring costs. This is the most practical way to compare executive office providers because it allows business owners to identify the true cost of an executive suite.
How to Determine the Total Contract Value of an Executive Office Suite
To determine the TCV of an executive suite, it’s important to carefully examine the agreement terms for the following:
Monthly Fixed Fee/Monthly Rent
Your monthly fee is the amount of money you will pay per month that doesn’t include any additional services (using meeting rooms, sending faxes, receptionist services, etc.). While some executive suite providers such as YourOffice Ballantyne will include many amenities and an allowance toward the use of a meeting space in your monthly fee, others will not. It’s critical that you are aware of what your monthly fixed fee is and what is included in this fee.
Setup, Refurbishment & Business Continuity Fees
There are certain fees that every office provider has at the beginning and end of their contracts and these fees also need to be compared. You might see a setup fee at the beginning of your contract that charges you to get your internet and telephone services set up.
Most often, you will see larger fees at the end of your contract which may include the refurbishment and business continuity fees. The refurbishment fee goes toward the restoration of the office space so that it is ready for the next renter. The business continuity fee is intended to keep your business operating smoothly by forwarding your mail and phone calls to your new location.
Calculating the TCV
Now it’s time to make a list of both recurring and one-time fees. For example, your list may look like the following:
Recurring Fees:
Monthly Rent
Monthly Telephone & Internet
Reception/Phone Answering Services
Kitchen Amenities
One-Time Fees:
Initial Setup Fees
Refurbishment Fee
Business Continuity Fee
To determine the TCV, add up the cost of all of your recurring fees. Let’s say they add up to $500. Multiply this number by the length of your contract. For a 12-month contract, this would come to $6,000.
Now add up the cost of your one-time fees. Remember, this includes the fees in the beginning AND end of your contract. Let’s say that they come to $1,000.
Add the total of the recurring fees and the one-time fees. In this example, the total would come to $7,000. That is the Total Contract Value.
Are You Getting the Best Deal on Office Space?
The only way to know whether or not you are getting the best deal on an executive office suite is by comparing the Total Contract Value of each office provider. If you have any questions about YourOffice Ballantyne’s services and fees, please contact us at (704) 912-4382 or stop by and we will help you find the perfect executive office to meet your needs!
