• Technical Services
  • Commercial Building Technologies
  • Environmental Responsibiity
  • Operations in Commercial Buildings

What is the Real Cost of “putting off” a Repair

False economies are found everywhere in building maintenance and compliance, which is why outsourcing the facility management pays dividends in the long term.
Building systems knowledge, building services knowledge, and understanding the limitation of suppliers secures market value in corrective repairs and ensure value for money when you let the purchase order for those repairs.

Delaying the Inevitable Cost

Sometimes it is a necessary evil, budgets and financial pressures force a corrective repair to be delayed, other times there are unforeseen issues which may be of a political nature, and then there is just a desire not to implement the corrective repair for the sake of avoidance; whatever the reason, it is will cost you more later.

Where are these additional costs

Lets take a brief look at direct costs:

  • The cost of inflation alone for product and labour
  • The rate of the Australian dollar for imported products
  • The domino effect on operations and other associated equipment or structure within the building which will be affected

Consider the indirect costs:

  • Energy costs
  • Repeated contractor visits
  • Your labour and time
  • Obsolescence
  • Product lead time
  • Availability of product
  • Business Reputation
  • Building Management company Reputation
  • Associated plant equipment compensating
  • Tenant Retention
  • Tenant Rental income
  • Asset Value

Indirect Costs can Compound and Escalate

let’s take the example of a car, for one reason or another a decision was made not to have a tyre repair made, the tyre had hit a nasty bump and its integrity and shape are compromised as a result.
We can consider the indirect consequence of neglecting this repair, for example,

  • The safety aspect
  • Fuel consumption increase in your car
  • The comfort or ride of the car changes and people don’t like riding in your car

And so the list goes on…

Consider the example of a critical repair in your building, for example, an outside air fan has failed.

We can consider the indirect consequence of neglecting this repair, for example,

  • The safety aspect
  • Additional energy costs as systems compensate
  • The indoor comfort environment changes, hence, the tenant doesn’t want to stay in an uncomfortable space in your building (the building becomes “stuffy”)
  • Additional wear and tear on other components, the chiller runs longer and harder as it doesn’t have any cool outside air to start the day with

The message is the cost of the repair pales into insignificance when you consider the indirect costs.

Reputation Cost

The Building and Property management company are exposed, their brand has a direct relationship with the issue and any tenant or prospective tenant is likely to associate a problem building with that team. It’s not good for business.

Tenant Retention

Consider the Tenant’s customer, if the issue effect’s the tenant’s business because a tenant’s customer with draws their business, your tenant retention will clearly suffer.

Outsource Facility Management Services

We’ll end on the “sell”, the fact is many independent non institutional commercial rea estate investors don’t have the time to look after and maintain their buildings, its not about the money, its often about time, and this where we can help as a company to improve returns. We give you back your time, we have clear transparent invoicing and reporting and we are sure if you calculated your time at a given hourly rate and then our costs the benefit would be clear when considering outsource your Facility management services to a company like ours.

Thank you for reading.

Nigel Wraight
Principle
Wraight Property

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