The business trend for the last thirty years has been leaner operations, increased efficiency, and lower overhead. Now innovations like cloud computing and growth in mobile operations like food trucks are causing business leaders to rethink ways to build a business.
Business ≠ Office
The days of equating a storefront or spacious offices with success are gone. While certain businesses require a physical location, for many businesses they are becoming obsolete. There are several reasons for this:
- Once a profession office or modern storefront in a prominent location were considered a minimum requirement for any successful business. Investors expected tours of impressive physical locations as part of their evaluation of a business. Now investors and banks are realizing that floor space may not be necessary.
- Office space might be an avoidable expense. Rather than seeing a lack of a physical location as a negative, for many experts appreciate the savings from not paying rent, insurance, and utilities for a physical location that may only be occupied 40 hours per week.
- Potential customers, contractors, and investors are all becoming accustomed to businesses operating without a formal office. From a taco truck on the corner to online shops, consumers recognize excellent products and services, wherever they are. Business is booming, too, with industry website mobile-food.com reporting that the $1.2 billion food truck business grew 12.4% over the last five years.
- Online services are still on the rise. The Wall Street Journalreported this year that for the first time, a survey found people making more purchases online than in store purchases, excluding groceries. Online companies are even started to market groceries in competition with brick and mortar stores.
- There will probably always been a need for storefront locations but many of them continue to be out performed by online stores. There are also advantages to the visibility of a storefront in a high-traffic location. On the other hand, prime real estate is expensive and it isn’t easy to expand or relocate a physical location.
- Social media and other internet-based advertising are becoming increasingly important. In many ways, online reviews and postings have replaced storefront visibility and word-of-mouth. Maintaining a presence online, however, has its own costs. Updating websites, posting to social media, and managing online reputations are time consuming and most companies need experts to do it right. Still, this means most brick and mortar stores must manage a physical location, in addition to their online identity.
- Cloud technologies have eliminated many of the traditional reasons for office space. With no need for a computer network and server, not only do businesses save on IT support, they are also liberated from the workspace. Have Wifi, will do business.
- Many companies are using the lack of fixed office space as an impetus for expanding their operations. From phone and distribution centres in economical locations, even small start-ups are able to take advantage to experts and workers from around the globe. Business can attract new workers and save on overhead expenses by hiring employees to work from home, rather than having to pay for office space.
- Cloud-based project managementand team collaboration software have facilitated the expansion of the office-less office. In fact, Forbes reports that the growth of the popularity of the cloud will lead worldwide spending on public cloud services to grow from nearly $70 billion in 2015 to over $141 billion in 2019.
Overall, the trend of rethinking fixed business locations offers great opportunities. It provides ways for existing companies to expand and new business to start up with minimal capital investment.
Cloud technology, start-ups, innovation
No (Office) Space – the Final Frontier
Your company’s best office might be nowhere.
Find out how the Cloud and other technologies are making companies rethink storefronts & office space. Could you save money and expanded new opportunities?