Whether you intend to operate your coworking space as an idea generator, collaborative powerhouse or profit centre, you’ll want to, at the very least, break-even.
When considering that only 41 per cent of coworking spaces are profitable in their first year of opening, (this figure rising to 72 per cent after two years in business), it’s important to understand the costs that will dictate your ability to balance your books – and survive those early years.
While your definitive costs will be uniquely defined based on your users’ size, location and your members’ requirements, by looking at these fundamental cost factors, you can begin to understand your potential expenditure and future budgetary demands.
Marketing and branding
Once you have a clear idea of your community, a strong marketing and branding strategy is paramount to reaching potential members and generating interest, especially as branding loops back into itself, helping to reinforce the community, while the community reinforces your brand. We see the core focus of this expenditure in event planning and PR work in the relevant catchment areas.
As you are essentially the landlord for your coworking space, you’re accountable for the location’s rent, business rates and utilities. These operating costs will be your most significant ongoing expenditure. Aspects such as high-speed Internet will be a necessity for your members, and it’s important to consider not only your connection but your local network and Wi-Fi set up too.
Finally, it’s often a wise idea to invest in support and contingency for your various utilities. In the example of your internet connection failing; you’ll want the issue remedied as quickly as possible so as to reduce any disruption to your members.
While your members may have their own laptops and phones, you’re ICT and AV systems will determine members’ ability to be flexible, productive and collaborative. There’s also the matter of security. Your teams are completely dependent on you to ensure that their workspaces and contents remain safe and secure, so cameras and alarm (not to mention network security) systems are all a must.
Whether you’re creating a meeting room or an open plan work area, you’ll want to make the most of that environment. The right furniture specification will ensure members work safely, comfortably and have the necessary tools to perform at the best of their abilities. In recent years, we’ve seen historically overlooked furniture aspects becoming commonplace in coworking buildings – especially those with an ergonomic impact, such as sit/stand desking, task lighting and acoustic panelling.
Design and build
The capital costs of your space’s design and fit out will prove your single largest expenditure, so it’s important to get them right the first time. You’ll want to capitalise on your real estate investment by accommodating a high capacity of members (without the space feeling overcrowded). This is achieved through space optimisation in the designing stages of your project.