8 Ways to Drive Growth of your Coworking Operation
Regardless of where your business stands in the coworking universe, your financial priorities are likely focused around making your monthly rent payments, member acquisition and retention, profitability and growth. There is a delicate balance between funding the costs of your coworking operation and generating sufficient revenue for growth. Below we outline some essential tips to grow your coworking brand. Whether you’re new to the game or run a longtime coworking operation, here’s what you need to keep on top of:
In this article:
1. Be smart about your commercial real estate investment
Take advantage of reasonable landlord incentives. For example, landlords looking to dabble in coworking operations are willing to pay for fit-outs or offer a certain number of years free of rent in exchange for a profit share or management agreement. These conversations are always worth having before committing yourself to the financial liability of a long-term lease or high CapEx expense of launching your workspace independently. Having the collaboration and financial security of the landlord new operators are better positioned for growth.
2. Drive early sales activity for your coworking operation
Generating demand and sales activity around your shared workspace before opening starts you off on the right foot with a high-level of occupancy. Being pragmatic around discounts and pricing prior to your launch will help to bring members and tenants through the door early. Watch out for the all too common pitfall of failing to bump up the price after the promotion expires. Collecting a couple of months security deposit up-front from new tenants is a reliable way to raise cash early to offset opening costs.
Launching your new business with comprehensive workspace management software positions you to ramp up sales activity, from lead to customer, with license agreements and automatic renewal options that ease the responsibility of managing your members and workspace manually. From generating demand with web-to-lead widgets and sales pipeline management to electronic signature functionality, you can keep a revolving door of sales activity with comprehensive workspace management software. Electronic signature integration to management platform makes it painless and trouble-free for prospects to sign with your space. It also enables your sales team to secure license agreements faster.
3. Offer revenue-driving services that differentiate your workspace
Your service mix and level of service play an important part in member satisfaction, retention and renewal rates. Services such as technology, membership plans, office space licenses, meeting room bookings and the overall experience you offer cast a wide net in a dynamic market. The level of price and margin control will be key to reaching profitability faster. Considering software enabled IT and workspace management platforms for powering your workspace can help de-risk your business by putting less pressure on CapEX investments and help ensure a sustainable business model.
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4. Explore unique workspace leasing contracts
Operators have found success with landlord partnerships to expand coworking or shared workspace locations within their existing portfolio. Securing a management agreement with a commercial real estate developer can be a guaranteed route to growth. With the future of the office sector clearly not just warming to coworking, bur normalizing its use across the board, developers will also find value in partnering with a knowledgeable workspace operator.
To best position your brand for success in a new venture with a landlord or developer, it’s key to demonstrate operational efficiency and profitability. Leveraging centralized and standardized processes and reporting and billing capabilities across your existing portfolio gives you a one up against the competing workspace brands.
5. Leverage automation and self-service
Automating key business processes and implementing online self-service tools can have a significant impact on both your lead conversion times and overall profitability. Make meeting room bookings and membership or virtual packages including ancillary services easy to buy and pay for from anywhere at any time.
Implementing online self-service and billing for your permanent and virtual customers as well as allowing your front-desk members to actively sell new services or sign members up for various promotions is a great way to build up more revenue for growth.
6. Report accurately and consistently
Schedule daily, weekly, or monthly reports to keep your finger on the pulse of occupancy levels, customer trends in IT and space consumption rates, tracking KPIs and more. Thorough and consistent automated reporting means you’ll be able to optimize your budget and ROI on both marketing and staffing. Unified billing across multiple sites will mean accurate results and less risk of payments or charges slipping through the cracks.
Reporting becomes crucial especially when looking at workspace location trends, benchmarking against competition or deciding when the right time is to open a new site based on existing and predicted financial results. Full control and visibility over your IT and service portfolio can ensure you can bundle services into value-add solutions and increase your revenues as well as profit margin.
7. Hone the workspace billing process
Smart business owners and managers keep a tight eye on their cash flow, accounts receivable and accounts payable. Running a dynamic business in a market subject to the ebbs and flows of the economy, it’s essential to master the complicated billing process. Working with advanced technologies that can drive new revenue streams, save money in payment processing and enrich your offering with a global network of workspace communities keeps you in the green zone.
Being able to bill seamlessly across your sites means less time wasted by staff on a process that can be easily automated and greater confidence for you and your members that billing is correct.
8. Power your coworking operation with scalable technology
Underpin your workspace with smart technology that facilitates the most fundamental pillars of your flexible workspace business such as bookings, billing and delivery of services. To really get the most of your workspace management software, however, opt for a platform that allows for integrations and even an open API. Save money and frustration by sourcing a platform fit for purpose rather than building one on your own.
A platform with an open API for integrations allows operators to reap the benefits of both complex operational functionality and layers of tools for new requirements, tasks and performance. With smart workspace management software, you can prevent the likely possibility of outgrowing a static, growth-prohibitive system and avoid being stifled by technology doesn’t easily scale with your business as it expands.
To successfully grow your coworking operation and distinguish your brand in the market, operators must ensure they have a sustainable business model. Taking advantage of market trends, space offerings, and being flexible enough to cater to different levels of performance, security and SLA demands is essential. Choosing the right software enabled IT, workspace billing and reporting platform will be key to steady revenue streams and profit margins. Being able to sell any service whether it is Wi-Fi, voice, lockers, concierge, workshops or events without any hassle will ensure you can pivot easily around key trends.
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