Co-working Market is at Awareness Level 3 in the AIDA Circles
Entrepreneur's New Year’s Guide
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
As the trend of co-working space is gaining importance in India, it has left many thinking about the movement of large enterprises in co-working spaces. The large corporate are, generally, known to have independent offices which become the symbol of their growth. However, over the last few years these enterprises are on the constant look out of co-working spaces that can meet their requirements. Adaptability of co-working spaces by enterprises is going high every hour since its providing them flexibility to contract/expand along with no operational admin office hassles.
The growth in such a trend is directly linked with the evolution of ease of use like we moved from standalone homes to apartments to furnished apartments and now to serviced furnished apartments . The same way we are moving from traditional working systems to managed serviced furnished co-working ecosystems.
At the top of it, the cumulative costing of the co-working space when compared with their existing private office space infrastructure is also coming lower in 60-70% of the cases. High level soft/physical securities along with built to suit options, community benefits, environment, employees culture becomes cherry on the cake then. With various luxury brand companies utilizing office space available at premium co-working options to maintain their class, it is also opening up avenues for premium retail and office space industry. Co-working market is eventually evolving into star rating analogues like that of hotel industry (7/5/4/3 stars), so luxury brands are ready to invest 2-3 times the amount for 5/7 star co-working spaces since they provide all the above mentioned co-working perks and a luxurious environment on the ice, hence moving the premium retail and office space industry too inclined towards the co-working format. Interesting would be to see how we convert the existing infrastructures (rather than just creating new ones) into co-working formats to avoid misbalance.
It is one of those markets at the moment which is at awareness level 3 in the AIDA circles. The above mentioned five circle benefits (cost, flexibility, no admin hassle, community, environment) along with how work processing inside startups/SMEs/corporate/luxury brands is evolving unconventionally is in absolute direct sync with the patterns of the co-working ecosystem.
The builders and investors should be looking at this investment option since the demand and supply in our market is growing hand in hand exponentially. Builders and investors have a great opportunity to build quality investments or strategic moves around the ecosystem. Talking about ROIs, all depends on the investment models and structures in place. But, certainly if the investment structures for this market are well understood and softly moved, ROIs will be super fascinating for the next two-five years. Say, we are at that stage in co-working, like e-commerce was in 2012-13 and ROIs were huge for the next five years for the right investment and deal structures.
Not only this, co-working is going to impact the residential market too. Co-working and co-living are like twin sisters since the pattern of ease to use/live/work is the same. Hence, as the co-working market grows, co-living and fully serviced homes market grows too, impacting and changing the residential market economics in a lot of ways.