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Serviced Vs. Virtual Office: Which Suits Your Business Best?

If you landed on this page, it is highly likely that you are trying to find the most convenient and affordable office solution for your business. However, making smart decisions for your company and avoiding bad ones is not easy.  

I can bet that you started by asking Google “What’s the difference between a serviced office and a virtual office?” This one is obvious, otherwise, you probably would not be here. I also bet that you have already spent quite a lot of time reading about these differences and trying to learn more about them. 

So, how can this post be different from what you have already read? I will do my best to teach you some steps to good decision-making that you can use in order to find the most convenient office solution for your business. The decision making process follows the ‘learn about the options’, ‘compare the options’, ‘review your situation’ and ‘choose based on benefits to you’ process. So, if you want to use it elsewhere in your life (such as which nice red wine to get to match dinner), feel free to apply the systematic approach to your day-to-day decision-making. 

Table of contents:

  1. Virtual offices – Brief overview
  2. Serviced offices – Brief overview
  3. Virtual offices vs. Serviced offices – Main differences
  4. How to choose between a virtual office and a serviced office

1. Virtual offices – Brief overview

Virtual Offices Are Flexible

I will give you a short definition that hopefully will simplify your understanding of virtual offices (just in case you have found too many other websites just trying to sell you on using their virtual office). A virtual office is an office “in virtual form” that gives startups and mid-size companies a professional appearance, while also providing them with a large range of services, such as a mailing address, rentable meeting rooms, a secure business mailbox, email handling and forwarding, etc.

Basically, a virtual office is a service that your company can attain by renting an office space without you and your employees being physically located within that space. I’ll try to make this as easy as possible. Imagine that you work from home while wearing fluffy slippers or your favourite coffee-stained t-shirt. Or, from a beach, a coffee shop, the best brewery in town or the middle of nowhere (as long as you have Internet connection). The services provided by a virtual office will make your clients and suppliers believe that you are actually located in a premium and physical office. They will never know that you are not wearing a white shirt and a tie while answering their emails. 

Below you will find a short explanation of the services provided by a virtual office and the way each one of them can help your company grow. Just bear in mind that some of these services can vary depending on the virtual office provider you choose. If all of them trigger your interest you should consider a premium virtual office (learn more about them here) and not just any virtual office. 

  • A business address – A virtual office will give your business a prestigious business address that will make your company appear larger and more professional. Your clients and suppliers will believe that you operate from a specific location. At the same time, your personal and family details stay safe as a virtual address allows you to keep your business and family details separate.  
  • Post handling and mail forwarding – You will receive all your physical mail and parcels at your virtual business address. Some high-quality virtual offices can provide you with a secure business mailbox as well. You are free to access the building of the virtual office provider and get your mail (also, if you choose a high-quality virtual office provider you can access the building 24/7) or they can forward your mail and parcels to your home address or any other address you prefer. In a few words, your friends or partner can get your business mail if you want, but fortunately, your clients and suppliers will never know that.  
  • A virtual receptionist – A virtual receptionist is a person who typically works remotely and answers phone calls on behalf of a business. This service will allow you to focus on the main activities of your business, instead of spending most of your time answering phone calls. Of course, your receptionist is a “virtual receptionist” because they usually work outside of an office that you rent (which is fine, especially if you get a virtual office).   
  • A landline phone number – You can use a local phone number as your own and have redirected to a virtual receptionist or your mobile phone – which is a lot more professional for your business image than providing your personal mobile phone number to everyone. Unless you set your favourite song as your phones ringtone and want to hear it on repeat in the middle of the night.
  • Meeting rooms – Sometimes, you may need a physical space to meet your clients and suppliers. Rentable meeting rooms are usually available at  virtual offices and are the best choice if you do not want to conduct your business meetings at home and show everyone the clothes on your drying rack.  

In a nutshell, a virtual office is a flexible and more affordable alternative to brick and mortar offices. They allow you to reduce your business overhead significantly by avoiding the high costs involved by a traditional office (the cost for renting or buying the office building, as well as equipment, maintenance, and safe costs), have a larger employment pool by hiring employees in various locations, and increase job satisfaction by offering a flexible and no-commuting work environment to your employees.  

2. Serviced offices – Brief overview

Business Meeting In A Serviced Office

A serviced office is a fully-equipped office space located in a building managed by a serviced office provider. This type of office allows your company to have a physical office and access a wide range of services but without renting or buying the premises. Usually, serviced offices are offered on a short-term basis rather than by lease agreement. Short-term contracts are much more flexible and often begin on a 3, 6 or 12-month commitment and sometimes they can be as short as 28 days. Just keep in mind that using a serviced office means sharing the office meeting rooms and amenities with several companies. 

A serviced office is more similar to a traditional brick-and-mortar office, meaning that managers and employees typically are required to travel each day to arrive at work. Companies that are relying on serviced offices can access all the services that they could access if they were to rent or buy an office building. Below you will find a list of the business functions provided by service workspace buildings:

  • Security
  • Cleaning and maintenance
  • Reception
  • Parking
  • Internet connectivity, IT infrastructure, and telecommunication
  • Administrative support
  • Breakout space
  • Kitchen and lunch areas
  • Meeting rooms

I guess you don’t need me to describe all of these services just like I did with the services provided by a virtual office. The way they work should be clear enough. You are free to use them once you sign up to a serviced office agreement but you must expect to share these services with other companies. Noting that some of these services will typically be available on a pay-as-you-use basis (for example, printing and email/postal management) and others will be included in your rates (for example, limited meeting room credits, tea/coffee, etc). 

However, if you don’t have clear ideas yet regarding the concept of a serviced office, I will share another example, as they can be tricky to explain. As I shared previously, getting a serviced office means that you will share the building with others. For example, you will share the breakout spaces and the kitchen and lunch areas. But a serviced office will offer your business some privacy, as your office is a space that is completely unique to you and your business and is not shared with others. (If you are wanting to work alongside others, that is called a co-working space and you can click here to learn more about the differences between virtual offices, co-working, serviced offices, and traditional offices). This means that in a serviced office you won’t conduct your business meetings in an open office space and you and your employees won’t work with other companies’ staff in the same room. You will only meet new people while taking a coffee break. 

3. Virtual offices vs. Serviced offices – Main differences

Virtual Offices Rely On Remote Work

Now that you have an overall picture of virtual and serviced offices, I will highlight for you the main differences between them (I am sure that you have already understood most of them but I like systematic approaches to decision making).

  • Serviced offices have a physical space meaning that managers and employees typically travel to each day to go to work, while virtual offices allow a company’s staff to work remotely from anywhere and only use an office for meetings. 
  • In a serviced office, most workers have to live within commuting distance from a specific location. With a virtual office, managers and employees can be located 14,333 kilometres from one another (Google says that this is the distance from Australia to Norway, just in case you’re interested.)
  • Serviced offices have higher costs than virtual offices, especially in the long term. If you use a serviced office for a few years you could end up paying more than it would have cost you to pay for renting and furnishing a traditional office (where the company owns the premises).
  • A serviced office gives the chance for employees and managers to have face-to-face interaction, while a virtual office requires a company’s staff to use virtual communication tools in order to interact (or they can book a meeting room once a week or month to meet face-to-face). Managers and employees in a company that uses a virtual office may never meet in person.
  • A serviced office means that you must share a range of services with others or use them when available while renting a virtual office is a similar situation but there are fewer people around using meeting rooms, so you will rarely run into them. 

To sum up, both virtual offices and serviced offices offer the same benefits as a brick and mortar office. The main difference is that a virtual office offers these services “in virtual form” while a serviced office allows you to have a physical space where the staff of your company can meet. 

4. How to choose between a virtual office and a serviced office

Choosing Between A Serviced And A Virtual Office

I am sure that you are already asking yourself “Is a virtual office or a serviced office the best choice for my company?”. The answer is: “It depends on your company’s needs”. 

I am not here to tell you that a virtual office is the only smart choice you can make for your business (although we would be more than glad if you could consider us at B2B HQ in case you reach the conclusion that a virtual office fits your business best) but to be transparent and give you some tips to help you make the best decision for your business. 

First, let me give you an excellent piece of advice. Avoid confirmation bias. According to Psychology Today, confirmation bias occurs when you look for information that supports your existing beliefs and reject data that go against what you believe. No, this article is not turning into a psychology lesson. What I am trying to tell you is that you should analyse the pros and cons of both virtual and serviced offices (in relation to your business) objectively. Do not make your decision before identifying the advantages and drawbacks that each one of them can bring to your company. Use the suggestions below to make a list of advantages and disadvantages that both of them can have for your business. 

A virtual office might be the best option for your business if you:

  • Own a small or mid-size company and you want to reduce overhead costs significantly
  • Own a start-up and you and you prefer starting your business journey on a limited budget
  • Plan to test the market in a new location
  • Want to expand your business or open an office in a new location
  • Have employees who are highly proficient in technology
  • Do not need a physical space

A serviced office might be the best option for your business if you:

  • Need the presence of your workers at the same place to work together as a team (for example, this can be applied to creative industries or advertising)
  • Must access office equipment and you do not want to purchase it
  • Need physical office space for a limited period of time (for example, you work on a short term project or you need a temporary office before moving into a permanent space) 
  • Start-up a business and plan on having customers and suppliers visiting you
  • Have employees who live in the same area
  • Have a pop-up business (in case you don’t own one and you have never heard about this type of business – a pop-up business is, in its simplest definition, a temporary business)

Now you have all the key elements in order to choose between a virtual office and a serviced office (and not to regret your decision`). Give yourself some time, weigh the pros and cons of both of them, and consider your business needs and your long-term strategic plan. 

Also, I was joking when I was suggesting that you apply the decision making strategy mentioned above when choosing between red wines. When it comes to wine, just go with your gut. 

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