Business Today

Virtual offices to boost productivity

A virtual office an office space in all external respects, but with no room for real-life people. It is rented by businesses to maintain a recognised city-centre image.

Amit Shanbaug   Mumbai     Last Updated: October 7, 2010  | 17:01 IST

Shabd Sharan Mishra, director of E-Renaissance Services, has been operating his business from the UK. However, he did not invest anything there but still has an office space, a receptionist who receives all telephone calls and an accountant who manages all his books of accounts. All this is possible thanks to the virtual office services that he has opted for.

A virtual office is exactly that - an office space in all external respects with no room for real- life people. It is rented by businesses in order to maintain a respectable and recognised city centre image.

In many cases, this will only be a managed post box, where mails are delivered.

In some cases, a virtual office can include many more features and services. Service charges are levied based on the kind of services opted for by the customers, which include a receptionist, an accountant, a virtual mail forwarding system, a meeting room and other infrastructure.

According to Pankaj Kapoor, managing director of, Liases Foras, a premier real estate research firm, many start-up companies can hardly afford the extra expense of leasing and running an office.

"A freelance worker or sole trader might be more than happy working from home and carrying out all the business from a spare room. But for some companies, keeping up appearances is essential to project themselves as being professional to their clients and customers," he said.

In such cases, companies need an office space as their base. However, if it is only for one or two staff, then the expense needs to be kept to a minimum. "There are many ways to create a balance between what's professional and what's practical, but one option that has been gaining popularity in recent years is the virtual office," he said.

Mishra said that he manages his overseas operations at a quarter of the cost of normal operations. "To set up a 1,000 sq-ft office space with the infrastructure it would cost me between �100,000 and �150,000, but by availing the services of professional agencies that have their systems in place, I get it done for less than �25,000," he said.

Payments to an accountant, receptionist and lawyer are billed by the hour. "By renting a basic virtual office for a simple monthly fee, a company can have access to a telephone answering system set to a number of their choice," Mishra pointed out.

According to Madhusudan Thakur, country head of Regus, a company which provides virtual office services in India and overseas, a virtual office can undertake administrative tasks, such as answering telephone calls, photocopying documents and handling printing projects, besides offering the company a chance to expand at a fast pace.

"However, it is generally preferred by companies that are venturing into a relatively unknown market and do not take chances in investing a huge sum of money before testing the waters there," he said.

With the increase in real estate prices, opting for virtual offices is a good alternative. "Expenses towards virtual office space services account for 10 to 12 per cent of our revenues. We expect very good response to this segment in the near future as well," he added.

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