Basic concepts of the theory of organizational systems and business design

Basic goals

The main goal of a business center business plan is the construction and rental/sale of suitable, comfortable and equipped premises for office and retail space. Related Goals:

1. Creation of a center that brings stable profits;
2. Organization of rental premises to meet market demand;
3. Providing the opportunity to open their own offices for small businesses and individual entrepreneurs.

The estimated area for construction will depend on the region of residence, the number of people in the city, the market need for rental premises, etc. All these factors must be taken into account when drawing up a business plan. The source of funds for the project is personal savings, a loan taken from a bank, and attracting investors interested in profit. The cost of the business complex is 250÷300 million rubles.

Payback—2÷3 years of constant work. To organize this business, it is most preferable to have your own cash, at least partially, which will allow you to avoid large monthly expenses for repaying a loan to the bank and significantly save on the interest rate. Therefore, personal savings and attracting investors are the preferred investment option. When applying for a construction loan from a bank, you should take into account the costs of monthly fees and interest payments on the loan, life insurance, construction insurance, etc.

Which building is more profitable to build?

In order to correctly determine the size, area and other parameters of a business center at the stage of planning and organizing business activities, you should take into account the city and region where the building is located. The construction of a multi-storey business center with a large area of ​​retail and office premises available for rent or sale in a small Russian city seems to be a low-profit and unpromising enterprise, since the entrepreneur will not be able to find the required number of clients and most of the retail and office premises will be idle, not generating income.

For small and medium-sized domestic cities, the best option would be to locate a two- or three-story business center that provides retail outlets and offices with no more than 50 premises, from 20 to 50 square meters each. The small height of the building, as well as the total area and number of premises of the business center provided for rent, will not only significantly reduce the initial investment in a business project, but also obtain the necessary permits in a simplified manner, in comparison with the process of registering a multi-story business center in a metropolis.

Main steps in implementing a business plan

The main steps in implementing this plan are shown in Table 1. Table 1 - Steps for implementing the business plan

Center construction costs and rent

The table shows the average figures for the “million population” of Central Russia. It also stipulates that the construction process lasts from March to October of one year.

Experts say that you should not save on either building materials or construction work. The better the team of workers is financially stimulated, the more reliable and durable the structure will be, the more comfortable and safe it will be for people to be on the territory rented from you. The size of the rent, and, therefore, your profit, directly depends on this.

General concept

The main purpose of the business center is to create comfortable premises for renting/selling offices to small businesses. Concentrating a large number of entrepreneurs in one place allows them to increase sales by 10–15%. The territory for the construction of such a center must be found closer to the center, where all the financial and business activities of the city take place. Thanks to a well-chosen location, you can get a constant flow of clientele and the premises for rent will not be empty, which is extremely important for generating a stable and growing income for the tenant. Finding an empty site for construction in the city center at an inexpensive price is quite a difficult task. Often, business complexes are built closer to the outskirts, which, with a well-organized advertising campaign, does not prevent them from becoming a center of trade and a place in demand among buyers. The territory can also be leased for a long period of 30–50 years, which will reduce additional costs for the acquisition of land.

Successful rental/sale of premises depends on several factors listed below:

• close to the main transport route of the city;
• availability of high quality basic communications (ventilation, air conditioning, working elevators, escalators, etc.);
• unlimited high-speed Internet, including Wi-Fi;
• high-quality finishing of premises;
• availability of a security system (fire and burglar alarms) and qualified personnel providing round-the-clock security of the building.

The construction of a multi-storey building (more than 3 floors) will require additional permitting documents and, therefore, will cause an increase in costs. Costs for construction, finishing materials, equipment, etc. will also increase. A more profitable building is 2–3 floors, with an area of ​​about 600–750 m2, divided into office space of 20–50 m2. The architecture of the building itself and its internal layout must be in accordance with the approved draft business plan. To choose a complex that is suitable for its structure, you need to consider several options developed by architects and designers with extensive experience and good recommendations. At this stage of construction, you should not save, since in the future income from rental/sale will depend on this. Projects may include:

1. Office premises;
2. Premises for trading floors;
3. Catering establishments;
4. Conference hall;
5. Rest rooms.

Another important point when drawing up a project is reserving a parking space. Whether it will be underground, in a separate building or standard, the choice is up to the business organizer. By building parking spaces for cars, you can stand out from your competitors, since in dynamically developing cities, parking is rare. It is worth including this additional item in your spending plan. The project for the construction of a business center must be carefully designed and calculated. If the building is ordinary (standard), it will not arouse interest among clients.

A business center should attract the attention of passers-by, stand out from the crowd of gray ordinary buildings with its novelty, original facades, windows, use of high-quality modern materials, and be unusual in architecture. There are many companies on the market that, when hired, can build a business center that meets all construction norms and standards, aesthetic requirements, and is unique and modern. Their experience in the construction of complexes of this kind should be analyzed. You should not save on a construction company and choosing a contractor! Table 2 shows approximate construction costs for a 2-story building, excluding the cost of workers' wages. Table 2 - Estimated construction costs

It is necessary to add another 20-30% to these costs for unforeseen circumstances. According to the recommendations of experts, there is no need to save on construction materials and work. The more qualified the construction team is, the better and higher quality the building will be built. The rent for premises and, as a result, the income received will depend on all these factors. It is worth considering that the more unusual the project, the more you will have to invest in it. A bright facade with a non-standard shape, windows made to order, interior decoration made of high-quality materials - all this will require additional investments, which should be taken into account when drawing up a business plan. It is necessary to calculate the demand for whether it is worth equipping the premises with furniture. This issue requires careful consideration, since you can invest in expensive, high-quality furniture, but it will not suit the general style of the person renting/buying the office.

Stages of business organization

Registration of activities

The initial stage of project implementation is the completion of the mandatory procedure for registering business activities. A beginning entrepreneur needs to register a legal entity - a limited liability company is the most favorable option, however, the construction and subsequent operation of a business center for the purpose of making a profit can be carried out as an open or closed joint stock company.

Among other things, at the stage of organizing construction it is necessary to obtain the appropriate permits. Also, upon completion of construction work, permission from the sanitary and epidemiological service and the local fire inspectorate will be required to put the building into operation.

Property location

The main difficulty that a novice entrepreneur will have to face at the stage of organizing a project is choosing the right location for the future business center. The effectiveness of further activities, the success of the project as a whole, as well as the formation of the revenue side of the enterprise’s budget directly depend on a competent and thoughtful approach to solving this issue. The difficulty lies, among other things, in finding a free and accessible land plot for the construction of a business center of the required size in a specific area of ​​the city.

It is recommended to select a plot of land for construction taking into account the closest possible location to the business center of the metropolis or the city center. The advantageous location of the business center will not only attract a larger number of potential target audiences, but also participate in competition at the local level with maximum efficiency.

Drawing up and approval of a building project

Approval of the general design of the building and approval of the necessary design documentation in the relevant control state body is an important preliminary stage that predetermines the immediate execution of construction work. The master plan of the building must necessarily provide for the competent and economical placement of retail and office premises, their connecting links, as well as individual elements of the building. In addition, the approved design documentation must provide for the effective placement of utilities and ventilation systems.

To ensure high-quality implementation of design tasks at the stage of preparation for construction work, it is recommended to seek the services of a specialized architectural agency with its own design engineers.

Construction

The most important stage of organizational and preparatory activities for the purpose of effective implementation of the presented project is construction work. In addition to the need to obtain permits from the relevant authorities to start construction work, the construction process, as well as the materials and tools used, must necessarily comply with approved state standards.

For high-quality and qualified execution of construction work, as well as for the purpose of prompt and successful commissioning of the building, a new entrepreneur is recommended to use the services of proven and reliable contractors.

Construction work is the most significant item in the budget of a business project. The overwhelming majority of the initial capital investment in the implementation of a business project is aimed at purchasing construction and consumables, as well as construction and payment for contractor services.

Upon completion of the fundamental construction activities, it is necessary to begin repairs and finishing work in the premises of the business center. It is recommended to carry out repair and finishing work in a general style so that the interior of the business center is implemented in an equally strict design and at the same time implies the possibility of the tenants of the business center premises carrying out their own repair work.

Launch and rental of space

The final stage of construction, repair and finishing work is the approval of the finished business center building and obtaining permission from the expert commission to put the building into operation. Office and retail premises are prepared for rent, sample lease agreements are drawn up, and a package of necessary documentation is compiled.

In addition to the administrators and customer service managers of the business center, you should ensure that the company’s lawyer is present when concluding transactions with tenants. If the costs of creating a fully functional legal department of a business center seem unreasonable to a beginning entrepreneur, it is recommended to use the services of third-party companies providing legal support for real estate transactions.

The success of the organization's future activities and the formation of the revenue side of the business project budget, assessment of the level of profitability and payback periods directly depend on a competent, carefully thought-out and planned approach to the final stage of launching a business center, as well as legal support of transactions.

Market research

Before constructing a building for a business center, it is necessary to pay the costs of conducting market research. In every city, regardless of its population, there are similar centers that can become competitors in this industry. Therefore, it is worth conducting a statistical study of such objects, analyzing them, finding strengths and weaknesses in the work. At the very beginning of the operation of a new complex, it is necessary to provide discounts to interested clients and try to guess their wishes and preferences. It is necessary to develop your own strategy for attracting a flow of regular customers, different from your competitors. Only by working with each of them according to an individual program can you overcome competition in this type of business. Before starting construction, it is necessary to research the market for which class premises (A, B, C) are in the highest demand among businessmen. The cost of office finishing will depend on this and, therefore, investments will be lower or higher. Only by carefully analyzing the market can you reduce the costs of idle empty premises. If you hire specialists for this statistical work, then you should include an additional 50,000–60,000 rubles in the cost plan. Thanks to the use of high-quality materials in construction, the work of qualified personnel, and the originality of the constructed building in the center, you can quickly enter this market and overtake competitors. To increase the flow of regular customers, you should not neglect advertising. Thanks to a well-executed advertising campaign, it is possible to rent out or sell office space before the complex is put into operation.

Advertising tools can be:

• Advertising in local newspapers, magazines, etc.;
• Advertising near a facility under construction;
• Advertising on banners along the roads;
• Advertising on your own website on the Internet;
• Advertising on local radio and television.

Advertising of a business center must begin during its construction. As practice shows, all areas are leased before the completion date of the building itself.

Marketing plan

Before we begin to consider the competitive environment, it is necessary to analyze the current state of the market in this industry at the moment (2016). Today, the economic crisis in the country, which began at the end of 2014, has made adjustments both to the lives of citizens and to the work of almost all enterprises.

However, gradually, starting in January 2020, the market began to demonstrate a smooth return to the “pre-crisis” level. “Weak” enterprises that were not ready to withstand healthy competition ceased to exist, thereby freeing up their niche for companies resistant to negative phenomena.

Banks have become more selective in issuing loans - one of the most popular financing instruments for creating and developing a business. Moreover, lending for organizing business projects has decreased by more than 50%; credit organizations prefer to work with already existing businesses that can offer some kind of collateral for loan funds.

However, many companies successfully raise funds from other sources :

• Issue bonds
• Place shares on trading exchanges
• Attract private investors to finance
• Use their own savings

The construction of various retail facilities in Russia at the time of 2013-2014 was marked by a rather strong decline. Since 2015, as absurd as it may sound, despite the economic crisis in the country, the construction sector began to increase volumes. This can partly be explained by the advice of industry experts (including from European agencies) that commercial real estate in Russia has been and remains one of the most profitable investments now and for the next few years.

The increase in retail space in our country is greater than that of any other country in Europe, and even a possible decrease in the volume of commercial construction by 5-10% will not significantly affect the situation.

At the same time, it can be noted that despite the introduction of economic sanctions and prohibitions for foreign investors to conduct business activities in Russia, many show the most keen interest and participation in the country’s construction market. It was this fact that, in some way, allowed the industry to stay afloat and not fall, as expected by many analysts who failed to foresee the simple human factor - obtaining one’s own benefit to the detriment of the interests of one’s state (we are talking about Western countries).

In addition, very optimistic forecasts are confirmed by the active activity of many retailers in the regions of the country. So, as an example, we can cite the Magnit retail chain, owned by Tander JSC. One of the rules of this company is the refusal to build its own retail outlets (it does not matter whether it is a convenience store or a large hypermarket), and only rent suitable retail space.

If we take into account the rapid growth of this company (about 4-5 new stores open every day, 1 hypermarket every week, which are located only in shopping and business centers), then it becomes relevant to consider the possibility of cooperation with this company.

You can also note the fact that many companies have recently preferred to move their offices either to the outskirts of cities, or even move to the regions, i.e. exactly where the construction of business centers is most relevant today. The reason for this was partly the serious transport problem in large cities (traffic jams, bad roads), lower rents, and other factors.

By analyzing the situation that has developed today in the market for the construction of business centers, we can conclude that this type of activity has become more profitable for its participants working in this area. The volume of consumers of retail, office, and other space has remained at the same level, and the number of “players” in the market has decreased significantly, which has opened up new opportunities for those remaining.

Download the business plan for the construction of a business center

However, it is necessary to carry out a set of activities to form public opinion and attract the target audience. Such tools could be:

• Massive advertising in local media (newspapers, magazines, television)
• Placement of advertisements in specialized print and online publications
• Placing a billboard with advertising information near a construction site
• Creating your own Internet resource
• Organization of own infrastructure and acceptable working conditions

Moreover, all activities should begin even before the start of construction of the business center. As practice shows, retail space is usually leased long before the facility is put into operation.

Table No. 2 presents the average prices for renting retail space in business centers in various cities of the country:

Financial expenses

When building a business center, equipping it and leasing space, the business plan should take into account the costs of taxes (profit, property, income, VAT, etc.). This large-scale project will require hiring qualified personnel, so you should take into account the costs of paying them; you should not save at this stage. For additional security, it is recommended to insure the building. Therefore, before setting a rental/pre-sale price, it is necessary to carefully calculate all costs so that the rental price can cover them all, but at the same time is not too high. Given the high cost of offices, many of them will be empty, as a result of which the business complex will be unprofitable. Table 3 shows examples of the cost of rental premises in large Russian cities. Table 3 — Cost of renting premises in Russian cities

Additional time of at least 2 months should be allocated to select suitable personnel with work experience.

Production plan

Equipment, inventory, and machinery necessary for the construction of a business center, as a rule, are the property of the contractor performing the construction work. The only thing. What is required from the customer is a thorough check of compliance of all technical aspects with the necessary safety standards, productivity growth, construction estimates, company reputation, and some other criteria.

Business registration and required documents

Most shopping centers open in partnerships, where one or more people invest in the future business. Therefore, we will need to register an LLC or CJSC.

Next, you will need to resolve the issue with documents. To open a shopping center you need to collect the following package of documents:

• Permission from Rospotrebnadzor;
• Fire safety report;
• Garbage removal agreement;
• Conclusion of GASN;
• Documents confirming the lease or ownership of land;
• Urban development plan;
• Project.

The package is impressive and we don't recommend trying to collect them all yourself. It is much easier to contact law firms that regularly do this. They will save you from possible mistakes and save a lot of time. The cost of their services will be approximately 50,000 rubles.

Engineering support for the office center

The components of the business center's engineering support are a ventilation and air conditioning system, hot and cold water supply, sewerage, electricity, lighting, telephone, Internet and television systems, security and fire alarms. An automation and dispatch system is used to manage equipment and utility networks. During the design of an office building, the efficient operation of all engineering systems is ensured at the lowest possible costs. Natural lighting reserves are used to the maximum to save energy. You can reduce air conditioning costs by creating a powerful natural ventilation system. Minimizing heating costs is achieved through the use of modern thermal insulation technologies.

Description of the project and its goals

The purpose of the business plan is to create a highly profitable enterprise in the form of a business center with the subsequent leasing of office space and the systematic extraction of stable profits. Among other things, the project is aimed at meeting local demand for office and retail space rental.

Despite the need for serious initial investments at the stage of organizing a business, a business project involving the construction of a business center is a highly profitable type of business activity that pays off in the conditions of the current crisis.

The essence of the project is to create office and retail space and provide it to clients through sale or rental. The first method, although it leads to a reduction in the payback period for the initial investment of a novice entrepreneur, does not imply constant profit making, which is why it is not a common and optimal option, unlike leasing retail and office space to clients, which significantly increases the profitability of the project . It is also a fundamental factor in the matter of the prospects of an enterprise and providing a beginning entrepreneur with a source of profit.

Other project options for small businesses

The relevance of this or that business area is changing:

• when a market niche is filled by suppliers of goods and services (for example, all entrepreneurs began to open cafes while the number of consumers remained the same) or when a new major player emerges,
• when the solvency of the target audience changes and its composition and quality changes (for example, with the influx of migrants, the need for goods with a characteristic national identity increases),
• when external conditions change (for example, when legislation is liberalized regulating a certain area of ​​activity, making it more profitable than before),
• when trends and fashion change, etc.

However, despite all the market volatility, some business projects retain relatively stable attractiveness for years:

• 
  Production of pelpet . Recycling of recyclable materials requires the purchase of an industrial line (about 300-400 thousand rubles) and the availability of suitable premises. However, the profitability with correct calculations is 90-100%. And if seasonal risks are associated with fuel pellets (demand during the heating season), then, for example, the production of cat litter is an out-of-season product.

• Among seasonal businesses, summer trade in kvass is often mentioned . However, this business project is more interesting for several seasons, since the estimated investment for permits and thermal tanks is about 100 thousand rubles, and the monthly profit is about 40 thousand. Taking into account the fact that the season in central Russia lasts about 3 -4 months, and taking into account risk factors, such a project will pay off only by the end of the first season.
• Breeding chinchillas . It is believed that 30 m2 is enough to start, and the initial costs for purchasing animals, equipment, cages and food are 300 thousand rubles. with an estimated monthly profit of 50 thousand rubles. Other promising analogues of business related to animal breeding are snail, quail, ostrich farms, as well as the already mentioned beekeeping farms. The common risks here are epidemics, availability of food supply, consumer interest, maintaining consistently high sanitary requirements for maintenance, and climatic conditions.
• Making stained glass . When producing cheap film stained glass windows, the estimated investment is about 300 thousand rubles, and the profitability is 15-30%, but there are prospects for development by attracting craftsmen and specialized specialists to an already operating business to create more expensive products. Among the business ideas that require the skill of the manufacturer to implement, they often name wood carving with small investments and quick payback, furniture reupholstery (investments from 70 thousand with an expected monthly profit of 40 thousand rubles), a European-quality repair workshop with a profit of 100 thousand . rub. The main risks of all these business ideas are related to ensuring a constant influx of customers and the “human factor” - dependence on the condition of the master.

Regional and climatic features, in most cases, impose certain restrictions on these types of activities, but with proper implementation they can simultaneously bypass less efficient competitors.