Credit Crunch: Will the serviced office industry benefit?

Last week Regus presented annual results showing a 54% increase in profits of £119.4 million.

Clearly the company has been performing well, with global expansion in South America, India and Africa to name but a few.  In the short term it is likely that businesses will be attracted to the short and flexible license terms that Regus and the other serviced office providers will be able to offer.

However, considering the longer term, as businesses feel the pinch, the amount of office space companies need may decline. But in reality the serviced office industry is still in somewhat of an infancy.  Misconceptions over how much serviced office space costs and the type of businesses that use it, means that there are still many companies that are not considering it as an option.  So even with a smaller critical mass of staff, the industry could really grow as awareness and availability is expanded.

One thing that I think will help is the budget providers such as easyoffice.co.uk which have helped shake off the aloof corporate image that some may have of serviced offices. They have also made serviced offices more affordable with very basic offerings allowing startup’s and SME’s to get going quickly.

The proliferation of low-cost airlines allowed for lower prices and greater choice of destinations. Hopefully the raising of the profile of serviced offices with do the same for this industry.  Although this may put pressure on the margins of the providers, if its at the expense of a substantial increase in demand then everyone should benefit.

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