Content of the material
- what is the average cost of relocating a business – Related Questions
- How much is an average relocation package?
- How much does it cost to relocate a company?
- How much is typical relocation package?
- How much does it cost to move a small business?
- What is a reasonable moving cost?
- What is a typical relocation package?
- What is the average lump sum relocation package?
- What should a company pay for relocation?
- What is a generous relocation package?
- What are business relocation costs?
- What is the average cost of a corporate relocation?
- What is the average relocation cost?
- Do companies pay relocation costs?
- How much do companies pay for relocation assistance?
- What Questions will Employees have when Relocating?
- Who Gets a Relocation Package?
- You’ve Got a Good Relocation Package, Now What?
- Are Relocation Packages Common?
- What can be included in a relocation package?
- Packing service
- Moving company and insurance coverage
- Home-selling assistance
- Paid-for house hunting trip
- Temporary housing
- Auto travel reimbursement
- Other relocation expenses
- 3. Transportation costs
- What is Employee Relocation?
- What are the different types of relocation packages?
- Negotiating a relocation package
- What will you need for this move?
- How much do you want to spend on this move?
- What about your current residence?
- Are relocation expenses for employees taxable when paid by an employer?
what is the average cost of relocating a business – Related Questions
How much is an average relocation package?
What should the price of ation package be? In general, you can expect between $1,000 and $7,500 when you receive a lump sum. A lump sum of $7,200 is typically paid to each employee across the country, according to Dwellworks.
How much does it cost to relocate a company?
You should prepare for moving costs of between $5,000 and $7,500 for a 5,000-sf office. Assembling and disassembling furniture is included in most moving company quotes; if your furniture requires a lot of work to setup, you should budget a little higher.
How much is typical relocation package?
What Should the Price of ation Package Be? The average relocation package for a mover who is a renter ranges from $21,327-$24,913, while the average package for a mover who is a homeowner ranges from $61,622-$79,429 on average.
How much does it cost to move a small business?
If you want to move your operation from A to B, you might need to shell out between $100,000 and $150,000. This move also includes a small amount of office space – typically about ten percent to fifteen percent of the building – and the documents associated with the office.
What is a reasonable moving cost?
In most cases, hiring professional movers for a local move will set you back $300 to $1,500 depending on its size. According to the size and distance of the move, long-distance movers can cost anywhere from $2,400 to $5,600. There will be significant differences in moving costs between a cross-country move and a local move.
What is a typical relocation package?
It is common for relocation packages to cover logistics such as moving and storing furniture, household goods, selling an existing home, house-hunting costs, temporary housing, and all travel expenses for employees and their families.
What is the average lump sum relocation package?
Flat lump sum payments for all employees level out the playing field and demonstrate that moving costs the same regardless of the employee’s experience level.
What should a company pay for relocation?
What is a generous relocation package?
Companies offer employees lump sum relocation packages as a form of financial help when relocating their employees. As a result, lump sum packages can facilitate employees’ immigration to a new city and enable them to begin their new jobs and careers more quickly.
What are business relocation costs?
The expenses of physically moving furniture, files, and equipment are only part of the cost of relocating a business. As you settle into a new building, the costs of moving begin to accrue.
What is the average cost of a corporate relocation?
Every year, companies spend an average of $16,229,125 on relocation. In most cases, this amounts to quite a bit of money, so it’s exceedingly important to use that money in the most effective manner possible.
What is the average relocation cost?
If you hire professional movers for a move, you should budget at least $1,000. A local household move costs $1,250, while a long distance move costs $4,890, as previously stated.
Do companies pay relocation costs?
Neither the employer nor the employee have to cover this cost: There are no laws requiring employers to cover this cost. It’s up to the employer if they want to offer it as a benefit. Job Relocation Packages Vary: Some offer a lump sum, whereas others require receipt tracking.
How much do companies pay for relocation assistance?
Transportation reimbursement for your transferee and his or her family to the new location is typically included in relocation packages. Depending on the company, they may offer up to $14,999 if they are covering the relocation.
What Questions will Employees have when Relocating?
As an employer, you need to be prepared to answer any questions your new recruit may have. Some of the most popular questions – and answers – that they may have are:
How does a relocation work?
The new employer (or existing if it is a location move) will talk you through the types of relocation packages, policies and what is available to you.
The process will then begin, it may mean that you visit your new city a couple of times to look for properties, book flights and start to pack!
How are the relocation expenses handled?
Some of the common approaches with expenses include: lump sum payments, cost sharing between the employee and employer or, payments are made directly to your bank account to cover the expenses.
Your new company or relocation specialist will reach out to discuss the process in full and this will include how the expenses are handled. Be sure to keep your receipts and invoices!
Does the company pay to relocate you?
Yes, and this can either be paid in advance or reimbursed. Packages will vary considerably.
How much are you given to relocate?
The full costs and figures can vary depending on the individual and their package however, as an example, payments are typically between $2000 and $100,000.
How long do employers give you to relocate?
Most companies offer a one month moving period, a long time for the employer, a bit of a squeeze for the employee! Some companies do offer an extended period based on the role and seniority level.
How much money is given for relocating?
This depends entirely on the role, skill level, type of move and contract. Once an employer has totalled up the financial costs and benefits, they will then provide you with the budget for your relocation. The benchmark figures across most industries are:
Current employee: homeowner $97,166
Current employee: renter $24,216
New hire: homeowner $72,627
New hire: renter $19,309
Is the job worth relocating for?
Hopefully, you had this question in mind during the application process! But you still need to know if it is right for you and we have a list of considerations below.
How do you negotiate a relocation package?
Similar to how an employer determines your package, you need to work out the financial cost of a move, based on your current situation. You can then provide the employer with this, keeping in mind the lowest option you can realistically accept.
What should I ask for in a relocation package?
You can ask for the following items, if it’s not already within your package or relocation allowance. However, a different version of these items could be included in the policy:
- Cost of a house-finding trip
- Temporary housing (hotels, apartments and short-term rentals)
- Transporting of pets
- Pack and unpack service
- If full cost is not covered, a partial reimbursement
- How is a lump sum package paid?
This is usually paid directly to you in the form of a cash payment or check.
All of these are valid and normal questions from employees when they’re considering relocation. It’s the handling of the questions, and the process, that makes all the difference to this process running efficiently.
Who Gets a Relocation Package?
While it is becoming more common for new, junior-level employees to also be offered relocation opportunities, typically the higher the employee’s rank within the organization, the more extensive the covered expenses of a relocation package. A recent graduate just starting their career may have only the basic expenses of moving, while a vice president will often have additional services covered, such as child care while house hunting, airfare and car rentals, lodging and meals for the employee and his/her spouse.
You’ve Got a Good Relocation Package, Now What?
If you’re happy with the benefits your company offers, you’ll want to think about the services you’ll need to move, and then create a moving budget that accounts for your expected costs. This way you’ll be able to fully take advantage of your benefits and make sure that none of the money you receive goes to waste. Using services that can streamline the entire moving process for you are one way you can make your relocation assistance go even further.
With Dwellworks Direct, we’ll match you with a local expert who will do your home search for you, and help you find a place to live quickly and easily. Forget about scrolling through real estate sites for hours, we’ll identify the best places for you based on your needs and the location you want to be in. Ready to put your relocation benefits to good use? Learn more about what we offer here.
Are Relocation Packages Common?
In years past, relocation assistance was offered almost exclusively to higher-level employees or specialized contractors. Today, with a more global economy and better-educated workforce, the competition for talent is stronger than ever; consequently, smart companies are jumping on the relocation benefits bandwagon.
A survey by DSJ Global indicated an upward trend around relocating employees. Career development is the biggest motivator with 69% of employees claiming they would relocate for the right position.
Companies are catching on to the fact that having a strong, attractive relocation package in place makes excellent business and branding sense, and become a reality for being competitive in today’s market.
Learn more about relocation packages in our free guide.
What can be included in a relocation package?
Companies are supposed to provide their transferring employees with everything they need to relocate. The following section will name and define the different aspects that should be included in a relocation package.
Your company should be partnered with a packing service whose job is to perform all the necessary packing for you so you don't have to worry. Your company should not only enlist their services but also pay for them on your behalf. They should also pay for an unpacking service once you arrive and are settled in your new location.
Moving company and insurance coverage
Another important component that can be included in a relocation package is a paid moving company to help transport your belongings and adequate insurance coverage to cover the cost of any of your personal items that may become damaged during the moving process.
A company might also assist in the selling of your current home, either through paid advertising or reimbursement fees for any lost profit as a result of quick home sales.
Paid-for house hunting trip
At least one house-hunting trip is often paid for by a company for an employee who will be transferring in the near future. They can cover the cost of transportation, childcare, accommodations and food expenses.
Another area that a company might cover in a relocation package is temporary housing for a transferee. If an employee is unable to find their own accommodation in the time allotted to them prior to relocating, their company may pay for and provide them with temporary housing for a period of 30 days. This allows transferees a month to find more adequate housing once relocated.
Auto travel reimbursement
Companies might be expected to include auto travel reimbursements as part of a relocation package. This means they might be responsible for paying back an employee with the amount of mileage or gas that was used to travel to their destination by car. For those traveling by air or train, a company might be expected to reimburse costs to transport an employee's vehicle to their new location.
Other relocation expenses
Other expenses that might be included in a relocation package is school relocation assistance for children of employees, temporary storage for household items that cannot be immediately transported or payment of state driver's license fees. There is usually a set amount of money that will be given to cover these additional expenses.
3. Transportation costs
Traveling from one place to another can be expensive, whether it be by car or plane. In addition to the actual move, the employee (possibly with their family) will need to visit the new location at least once before the move for house-hunting and getting familiar with the new city. Relocation packages often include some type of transportation coverage for two or three trips.
What is Employee Relocation?
Employee relocation is when a company chooses to move an existing employee, new hire or intern to a new location for work purposes. It allows you as the employer to source some of the best candidates from outside of your city, increasing the talent pool and staffing your business with the best people.
Employee relocation also includes covering all or part of the costs incurred to the employee.
What are the different types of relocation packages?
- Reimbursement: It’s just like it sounds: Your company pays you back after the fact. If you go this route, be sure to keep all your receipts. And get your agreement up front, in writing, for the maximum amount your company will pay — because there will be a maximum.
- Direct billing: Some find this to be the easiest option for employee and employer. All bills for your move and related expenses are sent directly to your new company, so you don’t even have to think about paying. Another benefit? Your relocation funding doesn’t run through your own bank account, so it’s not considered income by the IRS. Who can argue with a lower tax bill?
- Lump sum: Many employees prefer the lump sum deal — one payment, in advance of your move, and you get to use it however you see fit. A caveat, though: Budget wisely. Make sure you understand what all of your expenses are going to be before you start spending that lump sum. Otherwise, you may end up strapped for cash. Not fun when you’re new in town. (Or ever, really.) A notable perk of the lump-sum option, however, is that choosing to use a moving and storage company like PODS can help reduce moving costs, so you can use those savings on other relocation expenses.
- Third-party relocation: Larger employers are more likely to prefer this version of a relocation package, which involves a service provider that coordinates all of your moving needs. A major benefit for you: The movers and other organizations the third-party folks will hire to handle your move have been vetted, so you can be confident you’re dealing with reputable providers rather than taking your chances on possibly sketchy companies.
Negotiating a relocation package
When it comes to negotiation and a new job, the first thing that typically comes to mind is negotiating salary, but what about the relocation package? Regardless of the type of relocation package your soon-to-be employer is offering, don’t be afraid to negotiate the relocation package to address your personal moving needs. Oftentimes, companies set a “one-size-fits-all” allowance that does not take into account that people live differently and will, therefore, have varying moving necessities. In addition, certain states, for instance, are more expensive than others. For example, a furnished apartment in San Francisco is likely more expensive than apartments in, let’s say, Montana.
It’s just as important to negotiate the details of relocation when moving for a new job, and in doing so, the moving process will feel far less stressful. The relocation negotiation process may seem daunting when you don’t know exactly what factors go into the big move. Here are a few key questions to help you better understand and negotiate the contents of your relocation package:
What will you need for this move?
Doing research and laying out a blueprint for the big move with everything in mind is vital – from considering how far the move will be and even down to moving assistance. Taking note of what the move will consist of and having a clear understanding of how to address your moving needs will make the negotiation process much easier. For example, if you know that the move is cross-country and will take multiple days and a decent amount of gas expenses to get to your destination, it is important to take these expenses into consideration and communicate them with your soon-to-be employer, among all of the other moving costs.
How much do you want to spend on this move?
The cost of a move will likely vary from person to person, especially when the move includes families. If you don’t have a ballpark estimate of what your moving costs will be, you won’t know what price to begin your relocation package negotiation. The last thing you want during your relocation for a new job is an additional stressor of underestimating relocation expenses and then being left with extra expenses that are not covered in the end.
What about your current residence?
In the process of up and moving to a new city, there are additional expenses when it comes to either selling your current home or breaking the lease at a current rental property where you are residing. Consider what these costs may be (real estate commission, agent commission, closing costs, or lease-breaking fees) and highlight these expenses in the negotiation of your relocation package. Will the employer cover these costs as well? And if so, to what extent?
By considering each of these questions and determining your needs, you will be able to better negotiate the relocation package your future employer has offered, and in doing so, tailor the package to your moving necessities.
Are relocation expenses for employees taxable when paid by an employer?
Unfortunately, unless you use a third-party service or the direct billing option, your relocation package will be considered taxable income. This is a result of a law enacted in 2017 that allows only active-duty military personnel to deduct moving expenses from their taxes.