The recession has definitely provided an opportunity for people (myself included) to freak out. With massive layoffs, high unemployment rates, plummeting real estate values, and streets lined with shuttered storefronts—just to name a few of the recession’s impacts—who wouldn’t be worried? But, as much as the recession has created a hostile environment for economic and business development for many, it has also created opportunities for others.
One such “other” is business center companies (also known as executive suites) which offer small office spaces or even cubicles for rent—for both short and long term lease—and usually offer Internet and telephone access as well as other support services. Some of these companies include: Green Desk, Wurk Environments, Rockefeller Group Business Centers, and Regus Group.
A NY Times article’s title on the growth of this sector during the recession, “For Tight Times, Office Space on Flexible Terms”, says it all: due to a new set of circumstances (i.e., lack of financial and job security), businesses and entrepreneurs are looking to low risk, low investment, creative, and affordable solutions to their everyday business operations.
Green Desk “really simplified the process of opening an office,” Mr. [John] Humphrey [co-founder of Sustainable Energy Partners, which operates out of Dumbo's Green Desk] said. “Sizing is flexible–if I grow, I can move into a larger space. And they handle office stuff, like receiving packages and making sure the Internet and phone work.”
Green Desk’s other tenants include “a calligrapher, a tour operator, an investment manager and a fashion designer.” Flexible office space is an obvious choice for entrepreneurs and new small business owners–whose numbers have been growing due to large layoffs. Small Business Labs’ top ten list, “2009 Top 10 Small Business Trends”, includes (#1) The Recession Drives Small Business Innovation and (#7) Generation Y Will Turn to Small Business, as well as:
(#4) The Number of Small Businesses Will Increase in 2009: With job losses high and traditional employment options limited, many will turn to self-employment and small business in 2009. The prior three recessions have seen small business formation rates increase. And with it easier and cheaper than ever to start small or personal businesses, we expect a strong year for small business formation – especially personal businesses. Failure rates will also increase, but not enough to offset the number of new small and personal businesses.
These three factors contribute to a growing market for flexible and affordable, yet modern office space. (See the rest of the top 10 for more information on small business trends during the recession.) Not only are these trends indicators of what small businesses should be doing now (for example, being innovative), but they also provide a description of a new, perhaps more resilient business market: (in the case of the three listed above) a potential business client in 2009 is innovative, young, and small. So what should businesses be doing? After begrudging the fact that business is bad, unemployment is high, layoffs are occuring left and right, real estate is down, and the business next door shut its doors–businesses should re-calibrate in order to take advantage of the new opportunities and trends that have grown out of the recession.
Exactly, one person’s scare is the other’s opportunity. And most companies that end up being big innovators and later giants were starting in recessions or depressions. It’s all about perception really. Exciting to see these new companies stepping up to the plate. Great links, now bookmarked