Some Cost Elements in Systems Furniture

New or expanding businesses â€" and those planning workplace renovations â€" make decisions on how to build out and furnish their facilities.

â€oeFirst cost and lifetime cost are two key elements in the decision-making process,â€� says Mark Bassil, co-founder and vice president of MAiSPACE, a Mt. Olive, NJ, based manufacturer of modular office furniture systems. â€oeFirst cost at first glance would seem easy to define. It’s the bill paid for structural modifications to the workplace, the cost of furniture elements, their installation including power, voice and data cabling, and any other outlays needed before the workspaces are ready for employees to move in.â€�

Costs Avoided
An element of costs is costs avoided. According to Bassil, facility managers must not lose sight of the fact that simply making a decision to use systems furniture can have a positive impact on lowering first costs. â€oeWhen properly designed and planned, workplaces based on systems furniture vs. fixed plasterboard walls along with conventional movable desks, credenzas and other furniture elements provide up-front and lifetime savings,â€� he says. â€oeUp front, building owners are more likely to provide more favorable lease terms if their spaces are not cut up with fixed structural elements to be removed when tenants move out. Long term, because systems furniture is not considered as part of the building, business owners may qualify for furniture depreciation schedules and more favorable real estate taxes.â€�

Proper planning helps avoid unexpected first costs. â€oeWhile systems furniture is highly adaptable to changes in layout and configuration, changes due to poor planning at the outset can run up installation charges,â€� Bassil says. â€oeMAiSPACE counters this through its AutoCAD and GIZA design services plus providing installation supervision with their own on-site personnel or those from our dealers and distributors. Floor plans and furnishings are virtually fault free to minimize last-minute glitches during installation. Detailed specifications, product lists and installation drawings are available for review and approval before shipments arrive at the site.â€�

Lifetime Costs
Lifetime costs other than those offset by potential savings in depreciation and taxes are less easily pegged, Bassil says. â€oeThese consist of primarily of expenses involved in the inevitable Moves, Adds and Changes (MACs) that are a fact of life in today’s business environment.â€�

The ability of systems furniture to stand up under the stresses of the initial installation and subsequent MACs rests on its quality of construction. Bends or distortion in light-gauge or poorly constructed structural elements and tiles can make assembly or re-assembly difficult if not impossible. Purchasers should take note of construction quality and expect manufacturers to stand behind their product.

â€oeMAiSPACE is able to offer lifetime warranties plus guarantees against obsolescence at prices averaging 40% lower than some of the largest companies in the contract furniture industry,â€� Bassil says. â€oeWe’re able to provide spectacular modular offices starting at $12 - $15 per square foot installed, regardless of the number of units ordered. MAiSPACE price points disprove the assumption that a low lifetime costs can be achieved only at a high first cost.â€�

Cabling as a Cost Element

Ruggedly constructed modular furniture elements from basic 6 x 6 cubicles to full wall private offices, conference rooms and reception areas should easily accommodate a lifetime of MACs including alterations in size, height and cubicle footprints. â€oeMAiSPACE, although more attractively priced, is not alone among manufacturers of superior quality modular furniture systems,â€� Bassil agrees. â€oeBut we are alone when it comes to the most MAC-friendly voice, data and power cabling system in the contract furniture industry.

â€oeChanging conventional cabling systems to accommodate MACs can represent a tremendous expense each time it happens, and can be the most significant element in lifetime costs,â€� Bassil says. He notes a report pegging network downtime costs as ranging from $1,000 to $50,000 per hour. â€oeThis is because changes can involve taking down the entire office local area network (LAN) with attendant disruptions to doing business plus the costs associated with outside vendors to handle the job. Such outage costs over time could exceed the initial cost of the modular furniture system.

â€oeMAiSPACE solves this with its unique plug-and-play cabling system that simplifies LAN MACs to the point where in-house IT staff can handle them in a matter of hours after a minimum of training,â€� Bassil says. â€oeIt is based on a series of consolidation points placed strategically throughout the office and located behind removable tiles in modular furniture clusters.â€�

Consolidation points serve to connect cables running from workstation data outlets to the office’s horizontal cabling system. If a move is required, only those workstations to be moved are unplugged at their nearest consolidation point then reconnected to points near the new location. Business continues as usual elsewhere in the office. When workstations are added to an existing cluster they are simply plugged into the nearest consolidation point.

â€oeWhile other elements may be involved in first and lifetime costs, these are among the most significant,â€� Bassil concludes. â€oeWell-informed buyers of office furniture systems are positioned to minimize both of these cost elements.â€�