Shared Office Space: The Benefits and Disadvantages of Coworking

September 06, 2017
Two women meeting in a conference room

A key challenge for many small businesses is keeping costs low. One key fixed cost is real estate. Sure, many companies get started around a dining room table, but a home office isn’t practical once you have employees or when you need a place to hold client meetings.

A great solution for many business owners is shared office space, often known as coworking. Sharing a space may not be as satisfying as having your name on the office door, but it can be a cost-effective way to get workspace, conference rooms and support services.

Although there’s been a lot of buzz about coworking for high-tech startups, shared office space is nothing new. It’s an established concept that comes in many flavors. Which is right for your business?

Here’s an overview of the types of shared workspaces that may be available in your community, and the disadvantages and benefits of coworking options:

Subleased office space

Many businesses have more office space than they can use, so they are willing to sublet space to other companies.

Pros: This option is inexpensive and is easy to find in smaller communities.

Cons: You will need to negotiate such issues as access to conference rooms, copier use and telecommunications. If the primary tenant expands, the subtenants will have to move.

Shared office space

Office buildings all over the country often have an entire floor dedicated to shared office space. Shared space companies have offices in a variety of configurations, with conference rooms and even cubicles available, often for terms as short as one day. One coworking benefit of shared office space is that these companies provide telephone forwarding and mailbox services.

Pros: Big companies in the shared-office-space business are professional and they are familiar with the needs of small businesses. They provide a full range of office services, as well as passes that can be used at any location – helpful when making sales calls.

Cons: The décor and atmosphere can be bland. There is little interaction among tenants.

Coworking memberships

Many larger cities have coworking spaces that are structured almost like clubs. These target technology startups, but many are open to people in any industry looking for space. Several cities have shared studios for writers that offer a quiet place to work, which could meet your needs. Along with standard office services, coworking spots host networking and social events.

Pros: These spaces tend to be lively, with a great deal of tenant interaction and networking. Many offer day passes and virtual office services for people who need only an occasional place to work.

Cons: The atmosphere may be distracting or even unprofessional in certain industries. This option is available only in some cities.


Many communities have incubator spaces designed to help launch local businesses. Some prefer to be called accelerators or innovation spaces, but the operation is the same: physical space and intensive support to help companies grow. These may be associated with universities or economic development agencies.

Pros: Incubators offer working and business operations support. Often they provide connections to funding sources. They may have light-manufacturing facilities in addition to office space.

Cons: Incubators may have strict entrance requirements and a tight industry focus that may keep your business out.

What if your business is too large for a coworking space? Well, keep these tips in mind for when your company becomes large enough to expand into a new location. Whether or not you have your own office space, your small business and employees still need protection. Learn more about Nationwide’s affordable small business insurance, tailored to your company’s specific needs.

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