Does a New Business Really Need an Office?

Creating a new business means having a new office. Or does it? Traditionally, offices are a mainstay for businesses, especially as they grow and bring on employees. Although some believe that an office space is unnecessary, most small business owners still need one to maintain and provide ample working space for their employees and daily operations.

Even with the rise of faster Internet, working from home has become a viable option for both large and small businesses. However, there are some things a physical office offers that the virtual or digital world can’t.

To elaborate, here are some points of argument that strongly advise new small business owners to set up an office space.

1. A physical office helps give the right impression to clients and investors

First and foremost, having an office sets the initial tone for any meeting the business owner has with clients and investors. Naturally, these people might not trust the business owner during the first few meetings. So the ambiance of a well-organized office can help put the client more at ease that the company is professional and organized, building trust in conference rooms and beyond.

Unlike online meetings, where people only see the face and upper torso, a traditional office meetup allows the owner’s clients and investors to see the actual workforce and assess in person the value of the business. That may provide an advantage in negotiations and deals.

Suppose someone’s in the construction or interior design industry; they can use their office to showcase their work. For instance, clients and investors who visit a construction company’s office can see firsthand that the company complies with commercial stair codes. Visitors to an interior design company could see if the brand’s design aesthetic suits their preferences. This first-hand experience could help the customer decide to do business with that company as much as everything they discuss in their client meeting.

2. The perfect office space can help attract talent

Office space is more than just a desk (and more than a private office in the corner). Business owners can also utilize their office space to improve employee satisfaction and even attract the talent their business needs.

Great companies often brag about the excellent facilities and state-of-the-art features of their well-serviced offices. As such, most talented employees try to find a workplace that provides everything a business needs. Unlike working from home, where professionals likely have to use their own Internet and personal devices to work, high-quality talent looks for businesses that provide everything they need to become productive.

That’s why even a small office can help attract high-quality talent; when a prospective employee comes in for an interview, the owner can showcase their office facilities, allowing them to picture themselves there. The office space also gives prospective employees a glimpse into the company’s culture.

3. Office space might provide a better location for everyone

While remote working might cut down on a company’s overhead costs, that approach won’t work for every business. There’s no denying that, in some industries, an office space gives everyone a convenient place to meet, collaborate, and settle into a daily routine that enhances their productivity, even as the business evolves over time. It’s ideal if a business owner can find office space that is well-equipped to meet their evolving needs but is in a location that’s easily accessible by most employees.

Accessible office space doesn’t just impact the owner and their employees; it can also be beneficial for customers. Dedicated office space that’s readily accessible sends a great message to prospective clients. For example, a software company could have the most cutting-edge meeting rooms in the industry, but if its office is hard to access, potential customers might just search for a competitor instead.

4. An office helps a business build efficient infrastructure

Another advantage of having an office space is that an office helps an owner build efficient infrastructure for their company. If someone is still running their business through their home or garage, they’re limited in some of their capabilities. They’ll have a limited amount of space they can use for production and storage (to say nothing of room for employees). Odds are, they only have residential speeds for their high-speed internet, too (not ideal for people who do a lot of business in the global network).

Commercial office space in a dedicated building helps avoid some of those problems. Sure, the space might not be needed the moment the business opens, but no one wants to find themselves limiting business growth because they don’t have the space to make it work.

5. The perfect place helps create inspiration

The office space isn’t just a room of tables and chairs. For creative businesses, it’s an opportunity to help motivate team members. With the current trend of having innovative and eye-catching office spaces, an office can easily provide any artist or employee enough inspiration to think outside the box.

On the other hand, when a business owner keeps their staff working from home, they won’t have instant access to get help from others or collaborate right away. Instead, they’d have to set up a video call, or worse, settle for a dull chat session that does nothing to boost their creativity. In a nutshell, some businesses need office space to stimulate productivity.

6. An office helps provide security

When a business handles clients’ critical information, a secure office gives the company the resources it needs to protect that information. Unlike a remote office, a physical office gives a business owner a secure location for storing data and files. It also enables the company to set up a server or data center for software files.

Cybersecurity risks increase when a business owner uses residential or public internet access, so an office space can provide a more secure network. It also prevents the need to transfer data online (less secure).

Physical safety can factor in, too. In a typical office space, one common perk of the long-term lease is that there’s a security guard for the building, who can prevent angry former employees and disgruntled customers from entering and causing harm to anyone on staff. This isn’t available in every city or in every office building, but it can be a substantial perk to getting a space in a physical office.

Lastly, with an office space, a business owner can beef up the office security by adding policies and guidelines. This is one way of protecting employees not only from outside dangers, but also from those inside. If a company’s workforce is fully remote, it’s much more difficult to implement and manage these security policies.

What about coworking spaces?

In an era where more and more businesses are succeeding online, business owners might find themselves wondering if it’s better to rent access to a coworking space rather than traditional office space. Coworking spaces are flexible workspaces that many freelancers and other professionals pay membership fees to join in return for access to community amenities like furniture, meeting rooms, kitchen facilities, private phone booths (in some cases), and basic office supplies on-site. Generally, coworking spaces avoid the additional cost of renting office space, but they give entrepreneurs a dedicated space to meet with clients and a professional-looking address. Plus, they often provide support and networking opportunities for their members. Some independent professionals also find they focus better when they’re working at a dedicated “work” location.

Sometimes, these workspace solutions might be a good fit for a new business; they’re generally affordable, and they give the owner the ability to present a professional image to potential clients. But before making a final decision about using a coworking space instead of a traditional office, business owners should consider their plans to scale their business.

For example, suppose an entrepreneur has good reason to expect that they’ll hire five employees within their first year of business. For that rapidly expanding business, it might be worth the upfront cost to rent out office space (even if they don’t need those utilities right this second). That way, they’d have room for their team as soon as they’re hired on. But if a business owner plans to run a solo operation, then there’s a good chance that a coworking office could be the perfect place. It might strike a good compromise between working from a local coffee shop and having a dedicated office. And, as an added plus, the membership fee is usually easier on the budget than a traditional lease.

Conclusion: Many New Businesses Should Find Office Space

Many of today’s businesses will benefit from having a dedicated office space. The perfect workspace can help set the tone for a business and its goals. It can even boost employee motivation, fueling their productivity. While it won’t be the best option for every single business, such as freelancers and solo operators, there’s a lot to be said for having one, especially for startups with lots of potential to grow.

Disclaimer: The content on this page is for information purposes only and does not constitute legal, tax, or accounting advice. For specific questions about any of these topics, seek the counsel of a licensed professional.

Office Space for Small Businesses: Is It Really Necessary?