Virtual office idea offers solution to high rental fees




Many small and medium businesses die before their first birthday not only because of lack of proper book and record keeping, but also huge overhead costs.



The biggest expenses in running a business mainly come from acquiring basic elements to make a business run smoothly such as acquiring office space and furniture. And after an office has been fully established, one has to incur other expenses ranging from utility bills like water, electricity and telephone to maintenance.



The huge overhead expenses mainly brought about by high rental charges in and around major towns have left many businesses, especially Small and Medium Enterprises – which make up the biggest chunk of Uganda’s enterprises – on their death beds.



However, experts say that with the emergence and adoption of the relatively cheaper serviced and virtual office concept in Uganda, businesses can lower overhead costs and maximise profits.



The concepts
Under the two business solutions, enterprises either use office space full time, part time or occasionally under the serviced office solution model or virtually under the virtual model.



A serviced office solution refers to the renting of a fully furnished and dedicated office space, while a virtual office is an interim office that is mainly used as a business address to send and receive letters to and from the company.



Unlike the traditional office space where in addition to paying monthly or annual rent, one also has to invest in buying office furniture, computers, paying electricity and water bills, with the serviced and virtual office concepts, offices are always equipped with all the necessary furniture, ready for use.



The concept has started gaining momentum in Uganda, especially among start-up businesses and offshore companies as a cost-effective business solution, according to Ms Brenda Wegoye, the general manager, Eden Square Business Centre (ESBC) Uganda, a worker space provider at Rwenzori towers.



The benefits
Virtual offices also give businesses access to office and meeting room space without having to commit to a lengthy lease.



According to Ms Wegoye, contractual companies – those that operate in the country for a certain period of time –and startups need not to incur huge expenses to set up a traditional office yet they can make use of the innovative solution in the market.



Serviced and virtual office space also come with additional services such as cleaning, answering phone calls on behalf of the client the way the client wants it answered, connects calls, takes messages, handle sincoming and outgoing faxes, collect and forward mail on behalf of the virtual office client as well as paying utility bills, at a cost incurred by the office space service provider.



“We want a client to concentrate on his or her core business as we take care of the secondary business. So your business still goes on as usual even when you are away,” Ms Wegoye said.



She added: “There are business people who are never in office full time because of the nature of their work. This solution helps businesses lower administrative costs incurred were they to run business in a traditional office.”



In only two months, ESBC, which offers prime office space that helps build business confidence, has attracted six companies, mainly engaged in business-to-business transactions such as IT consultancies, financial services plus tour and travel, among others.
ESBC is the second global work place provider to venture into the virtual office business in a prime location in Uganda after Regus, which began operations early last year.



Businesses’ continued attraction to Uganda is hinged on good growth prospects and opportunities in oil, manufacturing, tourism, mining, Information and Communication Technology and construction sectors.



Posted January 18th 2013

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