May 03, 2019

All big firms started from being a small business, right?! And recently, there have been lots of statistics suggesting the increase of majority of workforce switching to remote working. Most of these people work from home just as a lot of small businesses do. To discover how much of them, let us examine some stats provided by the SBA Office of Advocacy.

Between 1993 and 2011, there were about 18.5 million new net jobs created in the United States. About 64 percent (11.8 million) of this was created by the small business. That is not the main point, here is the argument, 52 percent of these businesses are home-based. Yes! They are operated from basically the owner’s house.

Yet, there is something more interesting to this stat. It is only 21.5 percent of them that are employers, i.e. has another person involved in the business aside from the owner and probably his/her family.

The remaining 78.5 percent do not employ anybody. The business is solely run by them and also mainly from their homes. In case you are confused about which business can be categorized as a small business and others that cannot. Small business is a firm that employs lesser than 500 employees.

Looking beyond people employing few workers, there are an additional set of people that also belong to this classification, they are remote workers. Some of them are affiliated with a company. So invariably, we can classify the said company as a virtual office-oriented company. But what about another group that is also increasing daily? The freelancer community.

All made easier and possible by technology within 2015 and 2016 alone, the average hour spent freelancing by Americans increased by 72 million. Which means from 998 million hours to above one billion hours per week within a duration of one year.

The total number of the American workforce that is involved in freelance is about 34 percent of the total. And they contribute no lesser than $715 billionto the nation’s economy.

All of these people ― freelancers (or solopreneurs) and remote workers ― are both more likely to work from home. Technology has made the world easier and a section of the house is good to go for the business.

Using your home address as the business address should present no problem if you are a freelancer and all your works are basically online-based. Such as a writer that gets writing jobs from any of the freelance platforms we have today. On the other hand, if you are a small business owner (or remote worker) not affiliated to a company except your own company, the use of your home address for your business may not be too good.

Take this scenario as an analogy, you are planning to start a small business selling customized t-shirts and thinking of which to use between your home and a corporate address for the business.

That could be tough to decide but when you look at it this way it should be easier. If a customer request to return an order, which address do you think would look more professional to send to the customer, your home address or the corporate address? There is no debating it is the corporate address.

Put yourself in the shoes of the customer, after requesting the address to ship the product to and you received something like 1344 Grant Avenue, San Francisco, sounds okay but what about 1344 Grant Avenue, Apt. 3, San Francisco ― now you get the whole point.

A commercial address can be easily obtained from a virtual office provider. It will cost you lesser than having to rent a space just because of the need for a corporate address while you can still run your business from your basement. You are actually not alone, about 60 percent of business ownerswork from home probably from a section of the house designated as an office or the kitchen.

There are other reasons commercial address is needed for your business. There are some laws and concerns you may unknowingly be violating by using your home address and such could ruin your business.

Violation of Lease and Home Owners’ Association Rules

Lease contracts of apartments and condo complexes usually include a clause of the non-use of the property for business purposes. Legally, such apartment address cannot be used as a business address. Likewise, the case with some single-family homes with Home Owners’ Association (HOA) rules that also forbids the same.

Zoning Restrictions

There are areas with local zoning laws prohibiting the use of apartments for the operation of businesses. Although, it is not all businesses that such law would prohibit in many cases, therefore, do check with the relevant authorities to confirm if it is permitted. If it is not, you might want to consider renting a virtual office instead to avoid the high fee of renting a normal office space.

Business Type

As a sole proprietor business, you can be sued along with your business and in case of a fine, you may be forced to sell some of your personal properties to cover the cost. To avoid this, business owners will decide to register the business as a Limited Liability Company (LLC) or corporations. Even though these business types protect you against anything issue affecting the company, you may become yet vulnerable if you use your home address as the company’s commercial address.

Just as the law will state it, you will be piercing the corporate veil, thereby making you accountable for any issue linked to the business. And since there is no distinction between the business as an individual and you as a separate individual, both of you shall be liable for any debt for instance.

Privacy Risk

Imagine using your home address as your business address and you have this customer who is very terrified at the product you shipped. How would you feel if such a customer suddenly shows up at your house threatening to do all sort of things to harm your family if not refunded?

Even if they never appear to threaten, showing up at your doorstep anytime is not something you will like to always deal with.

General Reasons to Rent a Commercial Address

With no consideration given to any of the legal and privacy concerns discussed, let us examine some of the benefits your business stands to gain if you rent a commercial address from a virtual office provider;

Reduced Expenses

The use of a virtual office address for your business significantly helps to reduce your total expenses. Legally, to obtain a physical address, you will have to rent a space in an area that is zoned for business. But with the use of virtual office, you will be renting a space in an area that is legally zoned for business and at the same time at a lower price. Hence a reduction in your total expenses.

Easy Expansion

There is no way a business that is solely operated from your home can be expanded except you have a family that is willing to offer their house for such operation (which is rare). The use of virtual office commercial address can help you expand without limit. You do not have to worry about the search for a perfect location and haggling price with the landlord.

A virtual office evicts all of that and at the same time prevent you from paying for a space you might end up not maximally utilizing.

Professional Reputation

Business address improves customers trust and loyalty. Many of these customers will still accept your use of home address on contract, invoice, and mails but switching to the use of a commercial address significantly boost your professional reputation.

Moreover, you will be unable to list a home address on your website for instance as a physical address.

Meeting with Employees and/or Prospect

As a small business owner who manages employees remotely, there might be a need to have all or some of them converge for a meeting. Or you have a prospect who will like to have a face-to-face meeting with you.

Hosting any of these people at your house is not only less professional but also a breach of your family privacy. If you are thinking of booking hotel rooms for the purpose, that might be expensive. Renting a virtual office in the commercial address you are using for the business will be better and less expensive.

Access to Less Expensive Administrative Employees

Running a business requires handling things like an invoice, customer complaints, answering emails and arranging schedules with prospects. To manage all of this alone will surely be at the expense of effectively handling other important aspects of the business.

When you rent a commercial address, it is easy to buy a plan that will allow the use of virtual office assistants that, for instance, help you to answer the mails and customer complaints. They are well trained and most of them with years of experience working in similar roles at a normal office before switching to working remotely.

How To Rent A Virtual Office

Renting a virtual office is quite easy. Visit the virtual office provider websiteto check if they offer the kind of service you need. You should not only consider the space or the sole fact that commercial address is needed for your business.

Check the offered plan such as their cost of commercial address and also how much a virtual receptionist for instance will cost you.

You should also consider the distance of the virtual office location to your apartment as you will not like being held up in traffic jam daily just as most normal office workers experience.