Selling sawdust
Sell the sawdust! My favourite business book is Rework by 37Signals. The book itself is insanely useful as a small-business entrepeneur, but one of the images that stood out to me was ‘selling the sawdust’.
They use an example of a timber-mill, which cuts wood as its core business. The mill needs to generate revenue to meet a need, e.g. to avoid firing staff or grow a new project. They decide to sell the sawdust on the floor that was previously just sitting there until it would start to rot.
So what is your sawdust?
What can you sell and make revenue from the work you’re already doing?
Here’s a hint: it can be knowledge, it can be people, it can be scale, it can be contact…. or it can be space.
The reason we set up ConnectSpace was to help organisations (particularly not-for-profits), generate revenue from the space that they’re already paying for! It’s a no-brainer, and yet so many organisations don’t have the head-space (or head-ability) to think it through. What is one of the largest expenses you have, that you can literally hire out when you’re not using it? Space.
So what kind of space can be rented?
Our focus is on two room types: meeting rooms and training rooms. The kinds of people renting meeting rooms include start-up businesses, sole-traders, consultants, HR professionals (conducting interviews), or larger organisations wanting space. For training rooms, we have hired rooms to smaller RTOs, first aid companies, professionals conducting lessons in things like make-up etc.
Non-financial benefits of hiring out your meeting rooms
How about non-financial benefits? Would it be helpful to you to have a chance to promote your services and have a completely new market segment have very positive (and personal) experiences of your staff? Would you like people to be sitting in your waiting room and seeing your great annual reports on the coffee tables? If not, why not?
Hiring out your rooms to people in a related field provides an obvious chance for useful connections and referrals. If a lawyer is hiring a counselling space, it wouldn’t be surprising that if the client was really grieving after a separation that they would take them to the front desk to set up an appointment. If a social media consultant was hiring space from an accounting firm, either side might make a positive connection that leads to business – in a mutually beneficial way.
How much money can you make hiring out your meeting rooms?
Well, the short answer is that it depends on the room. A large training room in a major city generally can be hired out for around $400-$600 per day, not including GST. A smaller meeting room (e.g. 4-6 people), can usually be hired out for around $140 per day. Of course, it very much depends on location, inclusions, the room itself and many other factors (e.g. is a white-board and data projector included, are reception staff available to meet clients, is parking accessible and free or does it cost).
What’s stopping you?
There’s a few things you need to think through – when can you hire out your space, to whom, for what amount of money. Then you set up simple systems to get it ready, find a way to promote it (e.g. on this website) and collect cash.
Then the challenge is deciding which of the ‘urgent’ things to spend it on! Updating furniture? New IT gear? Adding to surplus? Staff bonuses?
Simon Goode ~ Director @ ConnectSpace