Business

Company's services aimed at lowering office overhead for small businesses

Finding office space is a tricky juggling act for many entrepreneurs. They need a place that has the right facilities, a place that presents the right image to customers — a place where the rent doesn't put the company in the red.
A receptionist is always on hand to greet business clients and other visitors coming into the Intelligent Office in Toronto. ((Intelligent Office))
Finding office space is a tricky juggling act for many entrepreneurs. They need a place that has the right facilities, a place that presents the right image to customers — a place where the rent doesn't put the company in the red.

The good news is there is a way for savvy small businesses to appear like multimillion-dollar operations for only a fraction of the traditional costs.

The secret: virtual officing, says Brian Monteith, master franchisee for Intelligent Office in Canada.

Virtual offices are an alternative for businesses that want to save on the costs of leasing an office and hiring administrative staff while still presenting a professional image.

Intelligent Office is one of many firms catering to this market. It offers its members a business address in the downtown core of cities, like that of Toronto's First Canadian Place, along with mailing services, plus 24/7 access to office space, conference rooms and boardrooms on an as-needed basis. Small businesses can rent rooms on a monthly, daily or even hourly basis.

Brian Monteith is master franchisee for Intelligent Office in Canada. ((Intelligent Office))
"If you were to lease an office and hire staff, the average cost for a small business with one to 20 employees is between $8,000 to $10, 000 a month to lease out that space," explains Monteith. "If you use Intelligent Office services, it's a 10th of that on average."

For example, Tarek Sardana, founder of Ottawa-based NOMADiQ Shelter Solutions, has a warehouse but he chooses not to hold meetings there because "its not professional looking." Instead, he holds his annual meetings with his three employees in Intelligent Office meeting rooms.

Intelligent Office has a monthly membership fee of $120. It costs an additional $20 to $25 an hour for office space, and $30 to $40 an hour for a small meeting room. On average, Intelligent Office services cost members approximately $300 per month.

Sardana has used office rooms provided by Intelligent Office more than half a dozen times since he signed up for the services last July. "If you're going to need your own office everyday, then it's not right for you. But if you're mobile, then it's perfect."

Location, location, location

Since 2005, Intelligent Office has opened offices in Toronto, Ottawa, Mississauga, Hamilton, Oakville and North York; a seventh location is expected to open in Waterloo by the end of this year.

The offices' downtown location make it easier for companies to hold meetings in an office that's accessible to all, including visiting partners and customers. It's this convenience that has encouraged Wes MacDonald's move from having a shared office to having an Intelligent Office. 

His previous office did not have a great location. His company — Like 10 Inc., a software consulting and information systems-management corporation — has many government clients and he needed a downtown location and address. So when Intelligent Office opened in downtown Ottawa, he says he was one of the first people to sign up. He has recently signed his second contract with the company.

Members can also access any Intelligent Office location throughout North America if they need to hold meetings in other cities. "You can use any Intelligent Office location, nationwide or in the U.S.," explains Monteith. "You just book that office through your head office."

Virtual office services

Members can also sign up for the Intelligent Assistant service, which has their calls answered, screened and connected to them by a receptionist. The staff, according to Monteith, is professionally trained to act as representatives to each company and their administrative support ranges from answering calls on behalf of members in the way they want them answered, to doing credit-card transactions and scheduling.

Intelligent Office meeting rooms can be used for small meetings with employees or clients. ((Intelligent Office))
Michael Page, chief executive officer of Barks and Fitz, a retail health-food store for dogs and their owners, says the services offered by Intelligent Office are "God-sent for any-size business in terms of cost-efficiency."

Barks and Fitz was founded in Oakville, Ont., in 2003 and has since expanded coast to coast in Canada.

Page pays $500 a month for the Intelligent Assistant services. He has been using it for the past two years.

"It does what we need it to. For our need and what we use it for, I haven't seen any disadvantages," he says.

His biggest attraction to the service: the live operator, because it saves him time answering general inquiries and performing other administrative tasks.

Like Page, NOMADiQ Shelter Solutions' Sardana, uses the Intelligent Assistant feature because it connects his clients with a receptionist rather than voicemail. He says this helps his business — which markets and designs temporary shelter systems for emergency housing, mining and construction offices and special-event centres — appear more professional to clients.

Alternative approaches

Steve Gedeon, a professor of economics and strategy at Ryerson University in Toronto, agrees that services that boost a small company's image, are important.

"It's nice to gain additional legitimacy by appearing professional," he says. "It does appear more professional if someone is answering the phone."

But while individualized service is a good thing, Gedeon says, he's not so sure that renting formal office space is the right approach for all small companies. Though rental rates for virtual offices are, indeed, much cheaper than traditional office space, Gedeon says it is not the only option for businesses on a tight budget.   "I agree that their price is less than setting up an office, but there is a third option: Be frugal," he says. "Meet in a hotel lobby, a coffee shop. There are lots of options that don't entail that type of money."

Gedeon, who has started several companies, says not all business owners need to meet their clients in a fancy office for work. In fact, speaking from an entrepreneurial perspective, he believes this could, at times, do more harm than good.

"It depends on what business you're in," Gedeon says. "People want to know that you are frugal. People want to know that you are investing in wise choices … that you can get so many things done at the fraction of the cost of others."

When it comes to having office space, entrepreneurs can make do for less if they know a few tricks.

"Don't spend anything, anywhere," he says. "Meet in a coffee shop, a hotel lobby, or better yet, why should you make your customer come to you at all? You can go to them. It shows that you care and they'll be more comfortable in their own space."

Gedeon says ultimately, the efficiency of having a virtual office really "depends on who you are."

Nonetheless, Monteith says Intelligent Office is growing and the recession, if anything, has helped its business. There are more than 850 companies using Intelligent Office services in the Greater Toronto Area alone and Monteith is aiming to have 35 locations in Canada by 2016.