Shared office space, or co-working space, is a fast-growing trend today. Companies looking to provide the flexibility today’s workforce demands are turning to this type of space for many reasons. WeWork, the well-established leader in the industry, operates 207 locations across 20 countries, providing services to 175,000 people, as of March of 2018. It’s an interesting case. Could your business benefit from moving away from the traditional office space into this type of environment?
Many people mistakenly believe co-working space is for the startup community or for freelancers without an established office elsewhere. In fact, more companies than ever, including larger corporations, are enabling their employees to use this type of space.
Shared office space like this is a simple concept. The company, for example, WeWork, owns and manages a large office space. Individuals who want to use the space can do so as much or as little as they need to. They pay a fee for access. The space itself offers numerous benefits. This includes ample amenities, access to WiFi, and lower expenses.
Today, many accounting and tax firms are among those using these spaces. Any type of company can benefit. They allow for companies to be present in communities without having to have a physical location. The concept makes sense. Firms who want to be near clients, but who do not want to pay the high cost associated with renting an office, can easily take advantage of shared office space. It keeps costs down and offers an opportunity to spread their services to a larger audience.
One of the nice benefits for any company operating in a flexible, shared office space like this is the improved financials. As noted, there are fewer fees associated with renting this space and maintaining it than leasing a space in every community. This can create more affordability for the company. These costs still create the same expense-related deductions to benefit companies.
It is important for any company considering this type of opportunity to compare costs closely. For the large organization that owns its own building, the costs may be comparable, but the equity in the real estate may be less. On the other hand, nearly any company with a real estate loan on their space will find co-working spaces to be more affordable in the short term.
In all cases, co-working space creates financial flexibility. It allows for the same tax advantages. It can often keep property management costs lower as well. Perhaps most importantly for those companies leasing space is the flexibility of being able to enter and exit contracts with more flexibility (depending on the terms of the individual shared office space).
Though more models exist than just WeWork, the company is the brand name for this industry. It’s amenities and on-site services have helped it to become the ideal solution in many communities. It’s important to note this type of shared office space model isn’t a new one. Today’s version creates a more pleasant and community-oriented feel that is needed. With that comes a number of key advantages for anyone using these spaces.
One of the advantages a co-working space provides to any firm is its community feel. People are not locked away in individual office spaces with walls in between them and their neighbor. Instead, they share the workspace. This creates the opportunity to network and build relationships. For a small- to medium-sized companies, this type of environment can create opportunities to grow the business. Sharing advice and guidance, along with referrals, allows companies in this environment to grow together.
Some of these spaces provide informational meetings, one-on-one lunches where industry leaders share their expertise, and networking events. They also create opportunities for companies seeking services to come into the shared workspace to find the professionals they need.
In today’s competitive environment, being able to provide employees with the perks they want and deserve is necessary, but costly. In a shared environment like this, the office provides those services. This could include wellness-focused services, such as meditation areas, fitness-focused services, such as kickboxing, and even meal services in some situations. Most tend to be in a well-positioned location to help make commutes easier, too.
Another advantage to the company is access to valuable services. This includes fast internet access, business-class printers, on-site staff to manage incoming calls and needs, common areas to meet with clients, and even coffee.
Another nice side benefit is the simple ability to be in a positive, enjoyable space. Teams can work together to share ideas and communicate. In a corporate company where most people spend time in a cubicle or behind a shut door in an office, this type of environment can facilitate more collaborative experiences between workers. It can also build loyalty within companies. This, in itself, can boost productivity and grow community relationships.
Could a co-working space enhance your business operations? It’s possible. It can be an excellent way to create another office space in a new community to expand your services. It could help you to reduce costs while providing a better quality environment for your customers and employees. For some firms, co-working space is an excellent opportunity.
Tim Murphy, CPA writes for CountingWorks, an accounting news and advice website. Reach his office at [email protected].
About Tim Murphy
Tim Murphy formed Murphy & Murphy, CPA, LLC in 1978 and is the managing member. In addition to being a Certified Public Accountant, he is also a Certified Financial Planner and a Certified Valuation Analyst. The firm specializes in tax planning and preparation, auditing services, accounting & bookkeeping, as well as estate, financial and retirement planning. They have offices in both La Plata and Clinton, MD.
