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In an era where flexibility and efficiency are key, businesses which can’t justify their own office space often need to decide between serviced and virtual offices, which have increased in popularity. This is because most of them do not have the financial capacity to invest in renting a traditional office space, and so, are left to choose between the two budget-friendly options.
These solutions both offer a new business venture a cost-effective solution for their premises,however they both come with benefits and drawback. It is important to figure out the solution that best suits the needs of your business. This article outlines the differences between a serviced office and virtual office.
Who Is Best Suited to A Serviced Office?
If you are starting up a business and plan on having customers and suppliers visiting you, and having employees, a serviced office may be the ideal space for you to rent. Particularly so for entrepreneurs looking for space but are not ready to commit to purchasing or even a long term lease on their own. Having a serviced office makes it easier to hire employees, carry out meetings, run campaigns and operate your business.
Also if you are expanding into a new market and are not yet ready to set up office in that region or if you are working with a team and doing a short term project.
Generally the provider of the space will offer you a short term lease and charge an agreed monthly fee. Also, business owners who need access to facilities, like printers, copiers or even meeting rooms, can benefit from a serviced office.
An entrepreneur can rent the office for any period. In this type of office, the facilities are generally high quality and accessed on a pay as you go basis. As opposed to the virtual office, the serviced office has a rental agreement plan, a fact that explains why it is more popular. The office is usually located in the same building as the company renting it out. It means that the entrepreneur gets to share all the facilities, including conference rooms and machinery, among others.
The Benefits of Serviced Office
- With a serviced office, you get to access a high-end office without paying excessive maintenance costs of a standalone premise
- Access to high-value onsite services and pay as you go facilities
- You only pay for the office you are using and not empty rooms you do not need
- The ability to take up additional offices/space when needed – and the ability to downsize if necessary
- It is a more productive environment since it is more structured
- The ability to network with other entrepreneurs located within your office environment
The Cons
- Serviced offices cost more in the long-term especially if the company has more than 30 employees
- It may not be possible to extend your corporate style to the office environment
- Less visibility for the business since it may not appear on the lobby directory of the building
- The shared facilities may not be available when needed
Who is Best Suited to a Virtual Office?
A virtual office is ideal for anyone who needs the appearance of having an office, but don’t actually need to be there. For example business owners running a business from home or those planning to establish themselves in a new geographic location are well suited to this type of office set up as it provides them with a business address, without the need to be physically present. A virtual office generally provides you with an address for people to send mail, someone to take calls/messages, receptionist services and some even allow you to hold meetings at the premises.
The Benefits of Virtual Office Space
- Office address in a prestigious location
- Access to quality administrative support and facilities
- Can help increase your productivity as you don’t need to deal with calls and messages
- Lower costs for running your business
The Cons
- Businesses that operate in virtual offices are not able to meet with colleagues. It means there is a lack of daily interactions for a good flow of work.
- There can also be the lack of motivation and too many distractions. This leads to a decline in productivity. However, for people who operate best alone and have self-discipline, this form of office set-up can highly boost their productivity.
- Employees generally only communicate via emails, social media, phone texts or teleconferencing, meaning there is close to zero face-to-face communication. This can lead to a number of problems, including a lack of coordination meaning lower efficiency and there can be a misinterpretation of communications.
- There is no physical presence, which can make meeting clients and suppliers difficult.
Both virtual and serviced office setups come with their unique benefits, with the most pronounced being that they are known to reduce overheads in comparison to renting out your own space. In both situations, the business owner does not have to invest in equipment and furnishings. When there are little or no financial means to get a business off the ground, both serviced and virtual office could save the day. With the two having profound differences, entrepreneurs need to understand the variations and which options will suit their unique needs.
“The opinions expressed by BizWitty Contributors are their own, not those of BizCover and should not be relied upon in place of appropriate professional advice. Please read our full disclaimer."
