Minimising your office overheads

Tom Welsh
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REMOTE working has come under attack, after Yahoo chief executive Marissa Mayer recently demanded all her staff come into the office. Arguing that communication and collaboration don’t happen when people work out of their living rooms, her decision punctures the confident prediction that a mix of new technology and changing lifestyles will slowly destroy the traditional office.

All very well for Yahoo, you might say, a multi-billion dollar multinational (albeit a struggling one) that can afford the luxury of copious space. But what of start-ups? Fixed office overheads can be hefty. According to Abacus Real Estate, a serviced office in central London can cost as much as £750 per person a month. Even if you opt to shift operations to Sunderland, it could still set you back £275 per person per month.

The reality for many new firms, particularly those without mounds of initial capital, is that it’s safer to begin life within the home. It frees up cash to invest in market research or product development, and provides a degree of flexibility. If everything goes wrong, you won’t have to offload a lease. And if everything goes right, you can still quickly scale up into more permanent lodgings.

But there’s also a middle ground – Mayer is right that home working is not always conducive to communication or to receptiveness to new ideas. So organisations like Club Workspace have launched new types of creative co-working business clubs. Typically open plan offices, with carefully designed ergonomic furniture and the atmosphere of a trendy library, they allow entrepreneurs to buy membership in a similar way to a gym. You just turn up, take a desk, and work alongside other start-ups.

It’s much cheaper than getting a serviced office, and networking events could make ideas flow more freely. But most importantly, co-working zones like Club Workspace allow for rapid growth and contraction – you buy space per employee, and can let that space go as you please. When companies need to be as nimble as ever, the middle ground might just be worth seizing.

Tom Welsh is business features editor at City A.M.