Difference between serviced office and virtual office

• Update:2023/11/14

When starting a business, the first concern is the “cost” of opening an office. It is a common thought that “we want to keep costs as low as possible” in any case.
In recent years, serviced offices and virtual offices have emerged as cost-saving office services and are used by many entrepreneurs and freelancers. However, many people may not know what the differences are between them.
For those who are interested, here we have organized the differences between serviced offices and virtual offices, as well as their advantages and disadvantages.

What is the difference between a serviced office and a virtual office?

Let’s start with the difference between a serviced office and a virtual office.

What is a serviced office?

First of all, a serviced office is “an office that rents a business space equipped with everything you need to start working. The office space is equipped with desks, chairs, and other office furniture necessary for work, as well as office automation equipment (printers, copy machines, etc.) and Internet access. Therefore, you can start working immediately after moving in.

Most of them also have conference rooms and meeting space, so they can accommodate visitors. Other optional services such as mail forwarding and secretarial services are also available, and the address can be used for corporate registration.

What is a Virtual Office?

In contrast, a virtual office is not like a serviced office where you can rent a business space to work in. A virtual office is a service that rents only basic information such as the address and phone number of an actual office.

In addition, mail delivered to the office will be forwarded to a designated address, and telephone calls will be automatically forwarded (or handled by a secretary). Furthermore, it is almost always possible to use the rented address for corporate registration.

In this way, a virtual office can appeal to clients as if there is an office there, even if there is no business space.

Advantages and disadvantages of renting an office

While there are many advantages to renting an office, there are also disadvantages.

The advantages of renting an office are threefold!

1. Great location, plus corporate registration!

Serviced offices are located in prime locations such as major urban stations and city centers. Thus, you can work in a good environment with good accessibility. You can also register your company using the address of the serviced office. Therefore, it is also recommended for those who want to start up a company.

2. Significantly lower initial costs and preparation time

In a typical serviced office, the initial cost is quite high because you have to prepare the office furniture and office automation equipment necessary for work. However, in a serviced office, the office furniture and office equipment necessary for work are provided in advance. This can greatly reduce the initial cost and shorten the preparation time.

3. Full range of optional services

There are many options available to meet your needs, including the use of conference and meeting rooms, telephone and reception services, and secretarial services. You can work comfortably and efficiently.

Two disadvantages of renting an office are

1. Costs may be more expensive for some optional services…

Serviced offices offer a variety of optional services as described above, but adding too many options for this or that may make the total cost more expensive. It is important to know in advance what options you need for your work.

2. You can’t refurbish it!

An office rental is just that – a rental. Be aware that you cannot refurbish the walls and floors to your liking or replace the office furniture.

Advantages and disadvantages of virtual offices

The following are some of the advantages and disadvantages of virtual offices.

The benefits of a virtual office are twofold!

1. By far the cheapest available

The biggest advantage of virtual offices is the reasonable monthly rent since there is no business space. This service can be used for several thousand yen to 10,000 yen per month, making it a very cost-effective service.

2. You get a prestigious address and can register a corporation

Similar to rental offices, virtual offices are often located in prestigious locations such as major stations in Tokyo. The ability to register a corporation using such a prestigious address can greatly help improve the credibility of the company with clients and others.

There are three disadvantages of virtual offices

1. Difficult to open a corporate bank account

Recently, it has become difficult to open an account as a corporation in a virtual office. This is due to the fact that many accounts used in bank transfer scams are registered at virtual offices. Therefore, if you are considering opening a corporate bank account, choose a large, well-run virtual office.

2. May not be able to obtain a business license

In some cases, virtual offices may not be able to obtain licenses for temporary staffing and real estate businesses. It is important to check in advance whether the type of business you are establishing will be approved for a virtual office.

3. Addresses may be duplicated with other companies

Virtual offices are used by multiple companies at a single address. Therefore, be aware that if you search for the address on the website, another company may appear first, and there is a risk that the virtual office will be known to be a virtual office.

Let’s choose according to the purpose and use

We have described the features, advantages and disadvantages of virtual offices and serviced offices. Based on these, we will now tell you who virtual offices and serviced offices are suitable for.

Businesses with many visitors are suitable for serviced offices

Serviced offices are recommended for service businesses and professional businesses (tax accountants and administrative scriveners) that receive many visitors. After all, having a business space in a well appointed building gives you a sense of security compared to a home office, and leads to trust from clients.

In addition, conference rooms and meeting spaces can be rented for meetings and business negotiations. Therefore, you can work with peace of mind as we provide generous services even to the part of handling visitors.

Virtual offices are suitable for industries that do not have (few) visitors

A virtual office is basically for people who do not have visitors and do not need a space to work (at home or elsewhere). For example, people who run a website, are management consultants, or sell products over the Internet would definitely benefit from a virtual office.

Virtual offices are also recommended for those who do not intend to expand the size of their business in the future.

Summary

Basically, serviced offices are suitable for industries that have many visitors (service industry, professional industry, etc.), while virtual offices are suitable for industries that do not have visitors (website management, management consulting, etc.). However, each has its own merits and demerits, so it is important to carefully examine the advantages and disadvantages of each before making a decision.

If you are looking for an office to rent in Tokyo, please consider Tensho Office. We have offices in prime locations in Shinjuku, Shibuya, Minato, and Chiyoda wards in Tokyo with the following three features

1. Reasonable initial cost

The initial cost is only 50,000 yen for a booth type office and a one-person room, and 100,000 yen for a fully private office for two or more persons. Furthermore, there is no security deposit, key money, or security deposit, so you can save a lot of money compared to renting an office.

2. Can be registered as a corporation

At Tensho Office, you can register your company as a corporation just as you would with a serviced office. Therefore, even if you are worried about being able to register your company…, it is okay.

3. Lots of optional services!

Use of the conference room, Internet access, utilities, and full facilities (shredder, dedicated mailbox, delivery box) are included in the common service fee. Therefore, monthly running costs can be reduced.

Tensho Office offers office space for rent at a reasonable price. If you are interested, please contact us for more information.