The key to surviving the economic crisis for Serviced Office operators is to raise service levels and retain existing clients; that is according to John Spencer, Chief Executive of the biggest operator of serviced offices in London MWB Business Exchange.
Last month Spencer told commercial and retail property magazine Property Week that serviced office operators should concentrate on encouraging tenants to stay with them rather than dropping prices just to fill space. At a time when new business has significantly dropped the focus for most serviced office operators is settling firmly on retaining current tenants. While price wars continue to rage, with many operators looking to entice new tenants with cheap deals, there is a limit to how much undercutting can take place in the market, and indeed how much it will benefit operators in the long term. Regarding MWB Spencer said: “We could build occupancy rates quickly, but getting back to respectable yields would take far longer.“
In an earlier interview with the magazine Paul Finch, co-founder of Orega also supported the philosophy of quality over quantity during the downturn. Finch said that although management contract opportunities were plentiful operators must defend against over-expansion at this time. “Most centres are very average and difficult to distinguish from one another“ said Finch “We refuse to enter into management agreements with anyone who is not prepared to turn their building into the best in town.“
This year customer care and quality of service has certainly been top priority for many leading operators. Two in particular have been very keen to demonstrate their own attention to client services. In early 2009 Business Environment introduced a fully all inclusive payment package. Offering clients an exclusive, one off monthly payment, the new pricing scheme allows for easy monthly budgeting, including everything from rent and rates to photocopying and even doughnuts on a Friday! Furthermore the company no requires no capital outlay from clients having announced a unique policy towards deposits which are no longer required. The average business centre client now stays with Business Environment for more than 14 months and additionally the company has won the Sunday Times “Best Small Companies to Work for“ award for 2009!
Avanta also revealed the results of an independent survey earlier in the year which showed that the company had further improved its level of customer service. Avanta commissioned Accelerator Solutions Ltd to conduct the survey from October 2008 to March 2009 which found that an overwhelming majority of 94% of clients said that their expectations were met, occasionally exceeded or frequently exceeded by Avanta. Jill Jackson, Avanta’s director of client services and personnel development, commented: “The ongoing success of our business is focused totally on the quality of customer care our business centres provide.“
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Source: Property Week