Most property owners require business owners to sign a lease contract of at least three years. Such a commitment is expensive not to mention risky for a new startup. You are unsure about the growth and expansion trajectory for your business at this stage. Hence, a shared office space becomes a viable option for new small businesses.
Before moving into a shared space, you must evaluate the option to determine if it is right for your business. Shared spaces do not work the same for all businesses. Weigh the advantages and disadvantages before you sign any lease document.
Low costs: The cost of renting a shared office is lower than the cost of renting your own space. Your business may not have sufficient financial resources to rent space for three or more years. In addition, shared spaces come with most of the resources that businesses need. You will find internet and telephone connections, seats and tables, a furnished kitchen, printers, and fax machines among other essential resources.
Many property owners are willing to customize your space to suit your business needs. Modern shared spaces have state-of-the-art furnishings. You will not incur the high cost of furnishing when starting your business. You can create the right impression of your business to your clients at a low budget. However, this depends on the space that you rent.
Flexible leases: Leases for shared spaces vary depending on the property owners’ terms and conditions. They range from a few days to months. Hence, you can rent the space for the period that your business requires an office space. You can adjust your lease term as your business grows. The advantage of short leases is that you do not incur unnecessary rent costs.
Networking: Your employees can collaborate with other employees in the same building and share skills and knowledge. Employees can share problem-solving skills even if they work in different fields. Sharing space exposes business owners to new methods of running a business, especially at the start-up stage. You can expand your network and find new business partners as you interact with other business owners.
Lack of privacy and control: You have no control over the space at all. The facilities and equipment are shared and hence your employees have to wait until the resources are free to use them. The high-quality equipment in shared offices is meant to increase efficiency but it sometimes leads to inefficiency. You also lack privacy while running your business. Other employees and owners can follow your meetings and observe your operations every day.
Instability: The flexibility of leases allows businesses to move in and out within a few months. You will always have new neighbors and these may not always be favorable for your company. For example, a competitor may be in close proximity, you wouldn’t want them discovering information about your customers, procedures etc. and there could be an increased risk of your staff being poached.
It takes time for a business to settle down in a new space and the ongoing change in varying business ethos’ and differing communication channels can be a disruptive process.
Disruptions and conflicts: We have mentioned the disruptions caused by other business as they move in and out. However, you must be prepared to deal with disruptions almost every day. You and your team have to deal with loud noises from meetings and training sessions. The constant movements to and from the location of equipment such as printers and fax machines are disruptive.
One of the common characteristics of shared office spaces is conflicts among employees. You may come up with a plan to work together at peace but since your neighbors change at any time, such agreements are short-term. Employees fight over resources. Personalities and perspectives clash as well, which leads to conflicts. Hence, you must train your employees on effective conflict management and be prepared to deal with such cases.
A shared office space may be right for your business if the pros outweigh the cons. The pros and cons largely depend on the space that you choose. For instance, some shared spaces are built in a way that there are few disruptions while working.
Consider the layout of the space and the quality of equipment before renting. Always check if there is a regulation in place that prohibits competing businesses being located in the one shared space. Do not compromise on the layout and location of the space because they affect the brand image of your business. You can save huge rent costs if you find an ideal shared space for your startup, just be sure to do your homework first.