Commercial & residential rental spike are affecting business costs and competitiveness within Asian businesses? Is there a way to view this in a positive light?
Rental spikes have caught organizations and operating budgets by surprise especially those who are renewing leases originally set out in the post 9-11 era in a gutted real estate market.
While some regional governments have been kind in providing tax reliefs, organizations will need to go back to time tested business fundamentals to address and prevail in these circumstances. They will need to focus on costs that are within their control & reduce these to counter & soften the impact of rent related cost escalations
On a more optimistic note I see rising rents flagging a robust economy! Overhead costs are up - but so are the opportunities for incremental revenue! Higher expenses can be justified if these expanded expenses generate expanded revenue while keeping the expense to revenue ratio at par with previously prevailing levels. Efficient organizations will take this in as a cost of doing business and get on with accelerating their growth within a buoyant economy.
Saturday, December 8, 2007
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