There is no shortage of emerging trends within the flexible workspace sector, and one particular development that’s taking centre stage is the corporate push into coworking.
We’ve seen a raft of private equity firms enter the coworking sector, like The Carlyle Group forming Uncommon and Blackstone buying into The Office Group. WeWork continues to make headlines by attracting corporate attention from multiple sectors; most recently the brand has been linked with a new office development for Facebook in Mountain View. And coworking is also making its way into corporate headquarters as a form of workplace amenity.
But despite its success higher up the hierarchy, let’s not forget that flexible space has long been, and continues to be, an invaluable solution for smaller businesses.
SMEs account for almost half of UK’s private sector turnover
SME clients are often considered the ‘bread and butter’ of flexible workspace. A recent CBI feature on small businesses by Pip Brooking (January 2018) found that SMEs account for almost half of the UK’s private sector turnover and more than 60% of private sector employment.
Yet whilst small businesses are not in short supply, they are considered under-prepared for economic shocks. Brooking examined the preparations small businesses must make ahead of Brexit, and cited worrying research that less than half of the CBI’s small businesses members (44%) had made any preparation for Britain’s looming exit from the EU.
Now more than ever, flexible workspace operators have an opportunity to demonstrate the support their network can offer small business owners - particularly against the looming challenge of Brexit.
Take, for instance, the value of reliable IT connectivity. Not every small business owner has the technical know-how to identify the right hardware for their business or set up a secure network - never mind factoring in printers and software programmes.
According to Savills’ flexible workspace search service, Workthere, that’s where fully serviced business centres really prove their worth.
Research from Workthere (February 2018) suggests that UK office-based employees waste on average 50 hours a year as a result of failing technology, which they estimate results in £11billion in lost productivity for UK businesses.
“With regards to the serviced office market in particular, the first thing we are asked about, after the cost, is what specification of technology will be available for a business to use,” said Cal Lee, founder of Workthere. “The office tech inventory can affect profits as well as play a vital role in the perception of a business, both internally and externally. Gone are the days of just ‘location, location, location’ - in the eyes of flexible space occupiers, digital connectivity tops the list of innovations that will improve the working experience in the next few years.”
Flexible space results in “higher productivity”
Technology is just one example of how the flexible workspace model supports the growth journey of small businesses.
Taking this idea further, The Instant Group has just released a new report that claims four out of five users of flexible space enjoy higher productivity levels.
The report - ‘Marketplace for Flexible Work’ (February 2018) - found that users of coworking and flexible space “are reaping further benefits in the form of greater work flexibility, growing professional networks, more business opportunities, higher levels of energy at work, and innovation.”
Aside from amenities such as IT provision, the report focused on the benefits of flexibility - such as location and the ability to relocate on short notice - which contributed to a favourable outlook for the flexible space sector.
“More than half of our respondents envision spending less time going forward working from a traditional company office space,” said Tim Rodber, CEO of The Instant Group. “This confirms our view that corporate occupiers in particular want far more flexibility and choice nowadays over how and where they work.”
As mentioned previously, IT provision and reliable connectivity (alongside on-site support) is a lifeline for smaller businesses. However, Instant’s research delves deeper into workspace amenities, claiming that “decent coffee shops, showers and wireless connectivity are key considerations” and should be seriously considered in workspace improvements.
The future workplace is amenity-rich
A whopping 89% of Instant’s respondents say that such amenities would improve satisfaction, alongside innovations in workplace design and the quality of the social experience.
Interestingly, the research raises a crucial point in the evolution of flexible workspace and comes at a time when our 30+ year industry is healthier than it has ever been.
The pertinent questions are, how do we maintain this momentum and continue delivering on client requirements - and client expectations? With so much headline attention levelled at the industry, we face a fascinating junction in our development. New workspace users, such as Millennials starting businesses or new generations coming to work for the first time, have read about Spaces, TOG (pictured) and WeWork and may hold high expectations for boutique, amenity-rich workplaces. Imagine they arrive at your front door tomorrow. Will they be satisfied, pleasantly surprised, or disappointed?
As Rodber notes, these areas of focus - the decent coffee shops, the showers, the social experiences - “are at the point where the ‘new’ market for workspace is challenging previous perceptions of the of coworking model - namely, a radical shift in the approach to design, providing more (and better) amenities, and curating the space to create atmosphere and interaction.”
Our sector is in-demand and is already meeting the needs of businesses of all sizes. Our goal is to stay the course and continue our upward trajectory, ensuring we continue to accommodate corporate requirements whilst also staying true to our sector’s ‘bread and butter’ business.
To delve deeper into the challenges and opportunities facing our industry, the emerging trends that could revolutionise flexible space, and to explore the myriad of ways in which our sector can grow and diversify, join us on Tuesday 15th May 2018 for the BCA Conference at etc. Venues in Bishopsgate, London, and discover how to future-proof your business for tomorrow.
Image: The Office Group, coworking at Henry Wood House.