The Nigerian office of an auditing firm closed in the middle of March 2020, as the coronavirus pandemic hit Nigeria, asking staff to work from home. When the Federal Government lifted the lockdown on May 4, allowing offices to reopen so far they put in social distancing and other safety measures, the firm announced that 25% of the staff should take turns to work in the office each week.
The policy has been a total flop and to everyone’s satisfaction! The six weeks of remote working using Zoom, Microsoft Teams and other digital meeting applications have worked so well that many staff and management are happy to keep working from home. Morale is high as staff spend more time with their family and less time in traffic and efficiency has not suffered. The management has permanently binned plans to expand office space as there is no doubt at all that remote working will be a part of the future in the firm.
Remote working has also become part and parcel of the work culture and financial plans of many Nigerian SMEs and this is also likely to outlast the pandemic. Leke Yusuf, the CEO of Lucnet Tour, a travel and tour agency, said, “My business partner and I have agreed on either giving up part of the office space or converting it to a virtual office. We do not need all this space. You don’t want too many people coming to the office. We have to bring costs down”. The cost saving advantage is important at a time when businesses are coping with lower turnover. Mr. Yusuf added that if staff come to the office, “they have to spend on transport and the costs have gone up.” While no SME owner is admitting it, the time and money staff save by working remotely will be an implicit part of wage adjustment during the pandemic and wage negotiation in the future.
The options SMEs pursue as regards remote working and decisions about the size of office space will, of course, vary across sectors. Many small retailers selling packaged food and fashion items such as bags, shoes and clothing will give up their shops completely as they have discovered and mastered “facing and serving” customers through Instagram and other social media channels. Logistics firms that handle their delivery are the new staff and the boom this sector is experiencing will likely last. SMEs in manufacturing probably need more space, so they can observe social distancing. Muyiwa Ferrera, CEO of the luxury wear brand, Crescencio Ferreira, said: "the coronavirus pandemic has meant finding ways to observe social distancing at the factory, designers, pattern cutters and tailors have been working on-site".
Firms rendering support services for businesses have used remote working differently and have different space needs. Afolabi Elebiju, Managing Partner, LeLaw Barristers & Solicitors says,
“We have worked most of the time from home, my staff and I would say we are coping well. Sometimes we need to get to the office, for instance, when we need to examine the hard copy of documents or when we need to look at some law books. But even then I just ask one or two people I am working with on the brief to join me in the office. There is something about people coming to the office. Sometimes you want to discuss something face to face.” While Elebiju thinks the office is important for other things such as training new staff, he would go ahead with plans to rent out another room in the firm’s two-wing duplex. He concluded. “We won’t go further than this. But I recognize the new normal of remote working, so I am now open to people working remotely once or twice a week.”
For Adedayo Ojo, CEO of Caritas, the specialist oil and gas communications firm, remote working during the pandemic has clearly revealed that the current office space is surplus to requirement, “I pay N2.6 million as rent in the office,” says Dayo Ojo, CEO, Caritas Specialist Oil and Gas Communications. “We also have a big generator and a cleaner. I will certainly not renew the rent in January 2021. We have not been to the office since late February 2020 and we have been running very well.” Ojo has decided to share an office with another business or rent a smaller space where Caritas would have access to a conference room. His plan is for staff to partly work from home, “The pandemic has shown us that we can work very well remotely.” he added.
Clearly, there will be greater demand for co-working spaces and virtual offices that offer flexible and scalable working spaces rather than agents or commercial property offering fixed office spaces. Siaka Momoh, SME Writer and Consultant says: “I met a friend some time ago while I was on a 7-month course at the Lagos Business School. He operates a virtual office which people could either use as an address or rent a small space at. He told me that his business has experienced a boom during the pandemic”.
Real estate agents have different views about the threat remote working poses to commercial property. Kola Olaitan, a realtor insists that “And rents can’t be reduced or discounted because of the pandemic. Tenants who default would be given quick notice to either make the payment or evacuate the building.” Babajide Okusaga of Boctrust Property and Investment Limited is of the opinion that the need for a “physical address where business owners can be located” will sustain the market for commercial property. But Okusaga admits that businesses “are not thinking now about expanding their office space or moving into new offices because of the impact of remote working”. He says that remote working is having a big impact on facility management as offices use less diesel and require less cleaning and maintenance as many of the occupants are absent.
No matter what property realtors think, it is safe to say that the future for SMEs is renting flexible working space rather than big office spaces they may not have use for. Many will move completely into virtual offices or rent very small spaces in buildings offering a mix of co-working spaces and shared offices to businesses. Not many businesses will still pay for spaces they do not need and that their staff have no need and do not like to come from 9 a.m. to 5 p.m. 5 days a week.