In this article today, We’ll cover the following topics:
- Is it the end of the coworking industry?
- The growth of coworking & Covid-19 hit.
- Actionable steps to get back on track.
Is it the end of co-working?
Several news publications & industry experts in the last 6 months have predicted that the world is not going to be the same after Covid-19 for coworking and several other similar industries.
We understand the fact that:
- Coworking spaces are empty for months now.
- People are afraid of going back to hubs where they might be exposed to Covid-19.
- It is a nightmare of Coworking sales and marketing teams, about how to find a customer. Like finding a needle in a haystack.
- Without monthly revenues, coworking spaces cannot survive as their cost remains the same all the time and margin are really thin.
- It is hardest than ever to workout on projections of coworking spaces when they will be filled.
- Landlords are making this situation scarier, as they want to rent out their properties… they don’t believe in coworking now. They don’t have patience.
Growth of Coworking & Oops!
Coronavirus changed the world, at least for 2 years or forever. Only time will tell.
A lot of industries got hit really hard, like a hammer on the head. They haven’t witnessed anything like this in decades.
Travel, Hospitality, Food, and nearly 250 ancillaries related to them, you talk to any business and they have stories to tell with pain and feelings.
Coworking, the new industry which grew up like anything in the last 5 years is one of them.
Growth of Coworking in India, last 5 years, and then Covid-19 hit.
You can simply see the hit on the chart in April 2020 and then a very slow pick in the following months till today (15th Oct 2020), the day I wrote this post.
Growth of Coworking in USA, last 5 years, and then Covid-19 hit.
The United States is the largest market for coworking in the world, then demand not fell at the same rate in comparison to India but still, it was a hard hit.
I couldn’t get the data of China, as Baidu is banned in India, and Google search data is not reliable in China’s case.
But the entire demand curve of the world is expected to be the same, no surprises.
People were locked inside their homes to contain the deadly virus. But, still, the outbreak happened in almost every country.
Due to this, the strength of Coworking became it’s curse. Governments across the world banned all the activities where people meet each other.
How we can survive this? Practically
There are several things which we can do to recover from this. Few depends on your efforts and few on the market.
Relying on the market is not gonna help this time, Let’s believe in ourselves and start making efforts to save what we have built.
- First things first, Re-negotiate your terms with your landlords. Try to keep monthly rental/min. guarantee lowest.
- Reduce other monthly maintenance costs like Internet leased lines, coffee machine bills, extra maintenance staff, save every unit of electricity.
- Bring your self back in the marketing mode, be a marketer now. You might be the CEO or Director, you can sit in your cabin later.
- Make a list of all the winning channels (digital, brokers, referrals, etc) which contributed maximum when you filled up your occupancy levels.
- Avoid relying on timelines, marketing agencies, and any other people involved. Just get your hands dirty with each channel to figure out what’s happening. How’s the response, check on a daily basis.
- Re-targeting previous potential leads if they are looking for an office.
- Throw away your pricing brochure for now, and work on each deal yourself and see what price the customer is looking at.
- See you if you can offer more and build more revenue streams, every penny counts. More means, meeting rooms, virtual office, events whatever.
- Any agency agreement going on.
- Re-structure your team, if needed… there might be areas where the production is not fruitful nowadays, as the cost of developing your own mobile apps, etc.
- Hold any other expansion plans, try to cancel them. We understand you have already signed agreements and made commitments… but try to see if there is a scope to cancel.
- Any other branding and community building activities, your call totally.
First milestone, do the breakeven. If any deals are coming in, try dynamic pricing. Like, discounted pricing for first 2 months and then actual pricing or decide the pricing again on 3rd month based on market at that time.
We hope that the above-mentioned tips can help you if done consistently to revive the current situation.
We would love to know your feedback or any comments you may have in the below comments section.