What Is Driving the Trend Toward Bigger Houses?

I’m going to make a potentially controversial comparison in this blog post between the housing market and other businesses, so proceed with caution.

When Bigger Isn’t Better

For the last few decades, house sizes have increased dramatically while household sizes have steadily decreased, according to the National Association of Home Builders. That’s a strange correlation. It seems like the fewer people there are in a family the less space they would need, wouldn’t you say?

What is driving this trend toward bigger and bigger houses? Maybe it’s meant to create demand. I would argue that having a larger house but fewer people in it leads to a desire to fill the house with stuff. It’s a marketer’s dream! Your problem is you have too much space, so their job is to get you to fill it up with furniture, appliances, video games, home entertainment systems and all sorts of other amenities. But you probably don’t need all that extra stuff.

It’s like if you serve meals on a huge plate you’ll feel hungrier than if you serve the same meal on a smaller plate. Whether dealing with houses or dinnerware, we feel an overwhelming need to fill them. Unfortunately, doing this can lead to financial and/or health problems because we might spend more and eat more than we should.

Do You Really Need More Warehouse Space?

I’m not sure if there’s a similar trend in stores and warehouses where bigger is synonymous with better. I hope not. But the same principles discussed above apply to businesses. Even if you’re just looking at moving to a bigger location because your business has grown so rapidly, I recommend you think hard about whether or not you really need the space before you make a final decision.

First consider these questions:

• Am I using my current warehouse space to the fullest?
• How can I improve my warehouse management?
• Is it worth the extra cost to get a bigger warehouse?

To find out if you’re using your warehouse space to the fullest, you can analyze your inventory to see how quickly you fill orders and if you keep too many products in stock. This analysis also helps you figure out how to manage your warehouse better. By reorganizing your warehouse and improving your inventory management, you can save a lot of space and put your money to better use.

It’s common sense to run a cost-benefit analysis on any business decision you make. If you decide your business is expanding fast enough that you need to invest in more office or storage space, then go for it. But if you learn that you still have plenty of room to grow in your current location, don’t worry about making a change yet.

Cut Out the Fat

Whether you’re considering buying a new house, moving into a new warehouse or ordering a meal, think about what you really need more than just what you want. What price will you have to pay to enjoy an extra benefit? Can you live without it? By paying close attention to how you use what you already have, you can avoid a costly mistake.

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