Reference no: EM133150668

QUESTION: Samson Corporation, a long-time client, needs our help.

As you'll read in Rick's email below, it isn't sure whether it should expand its current office space or move to the city. The company is asking us to draft a short (no more than 500 words) memorandum recommending a solution.

As you may know, we are a professional services company occupying a one-story building in an outlying suburb of a large city, and we have outgrown our present office space. Two possible solutions are being considered. One is to enlarge the present building by adding a second story. The other is to move the company into space available in a large office building in the city. Ultimately, we have two goals that will drive our final decision:

1. To obtain office space that most suits our needs for as little expense possible.

2. To minimize disruption to our employees.

Approximately 70 percent of our employees live within a half hour's drive of the suburb in which we are currently located, and roughly 20 percent commute from the city (which is about an hour's drive away). The remainder commute from even farther away. It would take almost a year to add a second story, during which time the construction noise and debris would be distracting to workers. They estimate that we would have to be shut down entirely for four or five weeks. But the addition would be tailored to our needs and would enable Samson Corp. To continue to be housed by itself in its own building, which is desirable because we handle confidential materials and are concerned about their security. Space in the large office building can be had immediately and the move could be accomplished in a week or two. We would occupy several floors of the building, at least one of which we would share with other businesses. The cost, offset by the sale of the present building, would be significantly less than that of adding a second story to that building. Property taxes are also lower in the city. The city, however, imposes a 3% income tax on employees and, in order to retain our employees, we would probably have to raise salaries to compensate for this tax. There is good public transportation connecting most suburban areas with the city, but current employees living farthest from the city would face even longer commutes.

Thanks Mary. We are looking forward to reading your team's advice.