January 03, 2024

Pros and Cons of Coworking Spaces

Coworking spaces are hardly a new trend. But recently, the combined buzz of the pandemic and the downfall of WeWork, once the largest name in the field, has helped to redefine co-working's value proposition.

Many cost-conscious employers are now sending people home to work remotely — and many of these displaced cubicle-dwellers lack a quiet workspace of their own. So, they're fleeing their bustling households in search of the proverbial clean, well-lighted place.

As a small business owner, you have the same needs — a refuge from blaring TVs, unscheduled conversations, and Amazon deliveries. So if you're considering co-working, consider these pros and cons.

What are the pros of a co-working space?

  • Affordability. Leasing, furnishing, equipping, and maintaining an office creates overhead. Now imagine walking into a thoughtfully designed space, with a printer you didn't have to set up and free-flowing coffee refills. These and many other amenities, when shared, will cost less than a traditional office setup. Note: Affordability varies by the supply and demand in your region.

  • An instant community. Joining a coworking community is an opportunity to network with other professionals in and out of your field, share ideas, and enjoy the camaraderie you may miss being an entrepreneur. Plus, getting to know other business owners can be incredibly motivating when times get tough.

    Some coworking spaces host networking events and social gatherings for members — a great way to make valuable connections with potential customers and partners over an espresso or microbrew.

  • Extras. Amenities cover a wide range of possibilities — everything from business services like conference rooms, super fast Wi-Fi, recording studios, and multi-location memberships to personal services like gyms, childcare, free parking, and snacks.

  • Flexibility. When you're growing a business, being able to pay for just the office facilities you need can mean big savings. Many coworking spaces offer several tiers of memberships that dial up or down the amount and type of space you'll use as well as the amenities and services you'll get per month or per year. Being able to revisit your needs every quarter, for example, can be a real advantage.

...and what are some of the downsides?

Cost. Some markets offer better deals on a standard office lease than a comparable coworking space, as reported in Coworking Cafe's quarterly review of U.S. coworking rates. In the worst-case scenario, a basic coworking membership could look like a budget win — before you add up all the additional a la carte charges.

Lack of privacy. Does your work demand privacy for phone calls and meetings? Can you keep sensitive business data secure? Even private offices in a coworking space might not give you the level of privacy your business or your industry standards require. This is particularly true in smaller communities.

Loudmouths. In a coworking space, you can't have control over other companies' meetings, loud talkers, or that guy two desks away who listens to a heavy metal rock stream between 8 a.m. and 6 p.m.. Will such distractions limit your productivity? Can you accept conditions out of your control?

It's not your place. Most facilities aren't going to let you paint, hang your own art, or bring in your favorite desk chair — they're all about their brand and their look. You'll also need to manage the limitations of sharing your space with a large group of people, including waiting for private meeting space or the printer, when you're on deadline.

Now that you have learned a bit more about what's to like and what's to watch out for, you're better prepared to make the right decision for your small business.

Since 2008, Fora Financial has distributed $4 billion to 55,000 businesses. Click here or call (877) 419-3568 for more information on how Fora Financial's working capital solutions can help your business thrive.