There’s no doubt about it, co-working space businesses have a huge profit potential. There’s been a big shift in how work is done in the last years, making businesses and individual professionals flock to these flexible office spaces.
Then again, the huge demand only makes for profit potential, not guaranteed business success. You can, however, boost your chances of having a successful co-working space business by adequate preparation. Here’s what you should be asking yourself before opening a co-working space:
1. Who’s your market?
Yes, people need co-working spaces, but who will you be accommodating exactly? Like any other business, you need to know who your market is, but this step is more crucial for starting a co-working space, as your business would solely depend on memberships.
Before getting into all the logistical details of starting your space, make sure to draft a member persona first. Have a clear picture of the customers you want to attract, identifying their pain points and interests.
Are you catering to the creative freelancer who doesn’t want the distractions of a home office or the noisy environment of a coffee shop, or is it the start-ups that don’t want to be tied to the financial obligations of renting a big space? Put into writing the descriptions of your ideal members. This would help a lot in your decisions later, from picking a location down to picking paint colors in your space.
2. What do competitors do?
If there are co-working spaces in the location you’re eyeing, it’s worth paying them a visit. Take note of what the space looks like, which services they provide, how many people are going, how members interact, etc.
Go to the events, like workshops or seminars, they’re organizing. Talk to the members if you can. Ask them what they liked about their co-working space. If your competition has been in the industry for years already, it’s worth exploring franchising opportunities. This will give you an advantage in starting the business, enabling you to ride on an established brand.
Plus, you’ll be able to get more tips from franchisors and co-franchisees about how to start a coworking space and compete with big names in the industry.
3. Which business model should you take?
The business model of your co-working space will determine the people you would attract and at the same time, give you an opportunity to differentiate your business from competitors. Some people go for the structure that includes not just the actual co-working space and community, but also the events and educational programs. This is profitable since it offers another opportunity for profit and could help attract potential members. There are lots of approaches here: you can either create your own program or partner with experts on the topic of your event.
Another sustainable business model is the coworking in partnership with your community. Match your programs with the goals of different groups in your locale. The big advantage here is you get to maximize publicity and access capital. If you want to be sure about your business model, again, you can explore being a franchisee.
There’s a huge demand for co-working spaces, so there’s a lot of potential in this industry. Turn that potential into success by planning well and preparing right.