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January 04, 2011
BY KATRINA PAOLA B. ALVAREZ Special Features Writer
A Sense of Space
Location, location, location—sometimes, your business doesn’t have one. Mobile entrepreneurs and freelancers take pleasure in the freedom to work anywhere, whether this means going door-to-door in a van or taking phone calls in bed. But some business clients may prefer a more traditional front. For startups that find real office space impractical or out of reach, a virtual workspace will allow them to keep up appearances without actually setting up shop.
Virtual offices provide businesspersons a commercial address and telephone number without the long-term leases, furnishing, installations and employees that come with opening a physical office. What clients see on your business cards, letterheads, and/or website is a prime spot in one of Metro Manila’s central business districts.
Under the surface, firms like the locally established KMC MAG Group and foreign Regus p.l.c. perform some helpful sleight of hand. They receive and forward your mail, answer phone calls in your or your company's name, and redirect important calls to your personal phone number.
Perhaps best of all, virtual office packages come at a fraction of the overhead charges associated with actual work areas.
For instance, the service provided by KMC at Rufino Pacific Tower on Ayala Avenue costs roughly P2,000 a month. Based on postings by various real estate brokers, this same amount would afford one approximately five square meters in the same building—excluding dues and utility bills. The lease period also lessens possible expense, as virtual headquarters may be rented for much shorter time spans—from a few months to a year—than those associated with real spaces.
These advantages have made the platform appealing not only to local entrepreneurs but to foreign companies looking for a Philippine foothold. "It's becoming increasingly popular due to Manila's appeal as a regional operations headquarters," KMC director Michael McCullough said in an interview. "A lot of people want to say they have a presence in Manila, and they can do this very affordably through the use of a virtual office."
William Willems, Regus spokesman for Southeast Asia and New Zealand, said that virtual domains also allow businesses to safely test the waters in a new terrain.
In a telephone interview, he said, "Companies need to minimize their risks, especially in markets where they have not been trading but they know there is potential. Before they decide to sign a very long lease for five to seven years, a lot of companies come to us."
That a virtual office has a prominent address attached to it may also help a new business to gain legal ground. It may, for instance, smoothen registration and processing with the local Securities and Exchange Commission, especially for those who work out of hotels or residential areas.
Mr. McCullough has pointed out that the paperwork can put new businesses in a tight spot; hence the necessity of settling in a standby address before they can acquire a physical one. "Very few people will lease you a space before you have your SEC [registration], so it's very hard to get started if you don't have an office," he said.
The setup may strike some as deceptive, but it has been acceptable business practice worldwide for at least 20 years, with the first virtual office providers sprouting in Europe and the United States during the late 1980s and early '90s. Mr. McCullough pegged the concept's arrival in the Philippines at roughly a decade ago, and Mr. Willems said that Regus was the first international provider in the country, entering in 1999.
For businesses that will never have need for a permanent physical office, the virtual domain leaves proprietors free to either stay mobile or stay on the couch. On the few occasions that have to meet clients face-to-face, their virtual office providers can also lend them temporary professional settings for an extra fee. As an example, Mr. Willems cited IT firm Fast Lane, which maintains a virtual office as a business address but uses Regus's meeting rooms to conduct in-person training.
Admittedly, the officers say that the platform does have a few downsides. "There is a recurring cost. If you don't use it, you still pay for it," Mr. McCullough said.
For his part, Mr. Willems added that expanding ventures may in time find themselves spilling out of their virtual workspaces. "If you see that your business is going well and you need more commercial centers, it's more practical to move from a virtual office to a permanent office."
Indeed, clients that have grown their companies have found themselves occupying actual headquarters arranged for them by their provider, which may be as small as a cubicle for rent or as large as full serviced floors, furnished and ready for move-in. Virtual office firms can prepare such a space within the same building as a client’s printed office address, allowing a business a quick move from the virtual to the real world.
New Media Group
Raul L. Locsin Building I
95 Balete Drive Extension,
New Manila, Quezon City,
1112 Philippines
Trunkline: (632)535-9901
Extensions: 706, 709-711
Direct Line: (632)535-9923
Fax No.: (632)535-9925
Email: New Media Group
