In the current economic climate, starting a new business can be a risky exercise. While you may offer the most professional and efficient business or even if you’ve introduced the ultimate calorie-melting chocolate bar to market, a new business is still vulnerable to failure when faced with a lack of essential start-up resources. For one thing, small businesses often struggle to find the capital required to launch and renting office space can be akin to bleeding money every single month. This is unfortunate because, according to research conducted by National Treasury, South Africa has an estimated 2.8 million Small Medium and Micro Enterprises (SMMEs), which contribute 52%-57% of GDP and about 60% of jobs. Furthermore, SMMEs contribute 40% of the country’s total remuneration.
“In other words, if more small businesses could actually find the means to open their doors, the South African economy could benefit substantially,” says Bradley Porter, Founder of Flexible Workspace. “Assets, inventory and overhead expenses are all part-and-parcel of what is required to begin a business venture, and sadly many potentially successful businesses can fail in their first year, purely due to a lack of resources,” says Porter.
Porter goes on to say that the solution to this dilemma for aspiring entrepreneurs is serviced office space. “Perfect for the cost-conscious entrepreneur, salesperson or frequent business traveller, a serviced office gives the business everything it requires to operate efficiently, at a fraction of the cost.”
Porter goes on to say that conventional office space will get the start-up business owner a large empty box with additional costs that include everything from telephone systems, building operating expense charges, furniture and IT support to administrative support. Aside from the tangible costs of traditional space, there is also the intangible price that must be paid. A small space tenant will not receive the same kind of attention from a building landlord that a large space tenant will enjoy. Not to mention the stress and anxiety that comes from being locked into a long-term lease and vendor contract. The business may also suffer as the owner spends valuable time and resources on hiring, supervising and training staff to run the office.
Consequently, fully serviced office solutions based in upmarket business centres have become a popular rental option for many start-up businesses as they offer flexible lease terms, better management of limited resources and a prestigious business address. In the eyes of clients and contacts, the business has a credible, professional and permanent place of business with its own support staff, while the business owner enjoys complete freedom to be wherever business calls — across town or across the country.
“In a climate of uncertainty, the serviced office option makes complete sense when additional finances are hard to come by,” says Porter. “The serviced office solution reduces costs significantly and frees up the business owner’s time and resources to focus on growing the business.”
An upmarket serviced office space provide the business owner with a professional receptionist, administrative team and complete access to copiers, printers, fax machines, scanners, ADSL connectivity and fully furnished board rooms for meetings.
This way, costs are minimized and the owner can focus on what is most important while all other requirements are taken care of,” explains Porter. The serviced office is also the perfect solution for start-ups that initially want to test markets and seek to focus on running their business without having to look into facility management and the associated costs.
According to Porter, the reality is that, until the noose loosens around the neck of the economy, many small businesses will have to look at more innovative ways of getting their ideas off the ground. “Traditional offices are becoming the less viable option and entrepreneurs can save more than R7 000 every month by opting for the serviced option,” says Porter. “Small business owners should not be discouraged to enter the working world. There are more cost-effective ways of starting a business without sacrificing credibility and professionalism,” he concluded.
By Brad Porter