10 Reasons to Start Your Business in a Shared Office Space
There are a lot of things that entrepreneurs and small businesses need to consider when launching a new business. Determining your office space is an important line item on the checklist. For some, the “gut” instinct may be to go out and sign a long-term lease for a permanent office location. Others—often entrepreneurs—simply elect to turn a room at their home or perhaps their garage into their office.
But are these the best options for an entrepreneur or small business when they first hang their shingle? The emergence of coworking spaces offers a better alternative for growing numbers. Growth in shared office spaces certainly corroborates this claim. Research shows coworking spaces—or shared office spaces—doubled from 2015 to 2018, and experts predict they will increase by 70% by 2022—hitting nearly 26,000 worldwide.
So, what are some of the top reasons to start a business in a shared office space?
Permanent office expenses comprise upwards of 10% of a small businesses revenue—the monthly lease payment, utilities, furnishings, and other fixed costs become a significant albatross hanging around the neck of a new business. For high-rent locations such as New York City, Northern Virginia, San Francisco, Los Angeles, San Jose, and Seattle, the costs of permanent office space are exponentially higher.
A study of shared office space reveals that they improve worker productivity by 74%. There are myriad factors such as collaboration with other workers, lack of distractions that occur in a home environment, availability of administrative support, and others.
Permanent offices typically come with a long-term contractual commitment. Many businesses, as a result, either have unused office space or grow beyond the confines of the office space before their leases expire. But the benefits extend beyond cost savings. A shared office space gives businesses the ability to add and retract new locations. And for those needing to expand into new locations, shared office space makes it seamless—without the overhead cost of a permanent location, which often is prohibitive.
Many business owners and their employees either are unable to work from 9 a.m. to 5 p.m. or do not want to do so. The same is true of the five-day work week. Shared office spaces, when coupled with the digital technologies such as mobile devices, cloud services, and more, enables entrepreneurs and businesses to work when they want to do so.
There are a lot of things to manage in a permanent office—internet, utilities, printers, fax, office supplies, and more. In addition to the capital expenditures (CapEx), the time managing this office equipment and functions can quickly consume valuable time. Rather than re-mediating internet outages or running to the store to get paper for the printer, entrepreneurs and small business owners can focus on running their businesses when using a shared office space.
Collaboration with Others
Other entrepreneurs and small business owners in a shared office community possess a plethora of knowledge and experience that can be leveraged by others in the same space. Problems can be quickly and easily resolved with the help of others. New ideas can be tapped to turbocharge a website or marketing programs. None of this can take place in a permanent office or home office.
Hiring administrative support in a permanent office is cost prohibitive for most entrepreneurs and small businesses. Many shared office spaces solve this problem; administrative help is just down the hall—professionals who can send faxes, answer and route incoming calls, order and oversee beverage and catering, and more.
Visitors—from partners, to vendors, to customers—form impressions of a business within a few seconds. As most entrepreneurs and small businesses cannot afford lobby greeters, visitors cannot get their questions about parking, room reservations, directions, and others answered. But most shared office spaces have lobby greeters.
Most shared office spaces come with meeting rooms—including presentation tools, video conferencing, and more. Administrative support typically comes with them as well; professionals who can book meeting rooms, arrange for beverages and catering, retrieve faxes and printed documents, and more. These accoutrements do not exist at a home office. And in the case of a permanent office space, meeting rooms are one size—and thus may be the wrong size—and moreover lack the underlying business support available with a shared office space.
Recruiting and Retaining Workers
The same research that shows workers are more productive in shared office spaces also reveals that it is easier to recruit and retain workers when a business is run from a shared office space. It takes entrepreneurs and small businesses 33% less time to recruit workers when their business is based in a shared office space. At the same time, turnover rates are 25% lower. There are a lot of reasons that this is the case—from shorter commutes to better work-life balance.