The growing consumer preference towards work flexibility and remote working is boosting the growth of global virtual office market. Small and medium enterprises along with startups have remained dominant users of virtual office services. However, increasing investments by large enterprises towards customised virtual offices services is estimated to proliferate the growth of global virtual office market over the forecast period.
The global virtual office market is estimated to accelerate at a CAGR of 15% over the forecast period (2021 – 2029). The study analyses the market in terms of revenue across all the major regions, which have been bifurcated into countries.
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Startups end-users to hold largest market share in 2020
According to Absolute Markets Insights report, Startups accounted for the highest market share in 2020 and is projected to maintain its dominance over the forecast period in the global virtual office market. The growth in this segment can be attributed to cost effective measures taken by startups to test new markets. According to SME Banking Club, the startup economy created the value around USD 3.8 trillion between years 2018 to 2020. Additionally, democratization of tech created more than USD 540 billion within the same years. High rate of start-ups in Silicon Valley, New York, London owing supporting government initiatives drove startup ecosystem, which subsequently aided the growth of global virtual office market.
Virtual offices being one of the major aspects of flexible workspace sector, offers organisations an array of services without upfront cost of leasing or buying traditional office workspaces. Virtual office technology provides benefits with digital storage, coworking spaces, communication services to wide range of employees. Growing necessity for remote working amidst pandemic along with high demand from IT tech businesses have created lucrative opportunities for virtual office market participants. In addition, adoption of virtual offices by organisations have enabled them to reduce employee travel time and improved use of office space economically. The aforementioned factors increased the adoption of virtual offices across startups, and small and medium enterprises which subsequently drove the virtual office market growth in 2020.
From pricing model standpoint, monthly or annual subscriptions allowed various end-user to attain more flexibility albeit end-users opt to change their services. For instance, waiting time for lease to expire or incurring cost of broken lease is eliminated. Also, requirement for staffing or maintenance upkeep is removed. Cost efficiency associated with virtual office pricing models is further projected to propel the demand for virtual offices in the extended run.
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Changing consumer preference toward hybrid working is projected to foster service demand
Growing trend of ‘Great Resignation’ among individuals characterized in response to COVID-19 pandemic along with high rate of wage stagnation fostered the approach of hybrid working. According to Microsoft Work Trend Index 2021 survey, 70% of employees opted for flexible remote work options to continue their current job. 66% of organisational leaders are opting to redesign their company for hybrid work. Moreover, increasing number of full-time remote working employees along with digital nomadism has further propelled the adoption of virtual office. Furthermore, after relaxation of pandemic restriction, opening organisations in line with COVID-19 office guidelines opt to reduce face to face meetings owing to which demand for virtual meeting rooms increased. Such factors are projected to increase the virtual office services and drive virtual office market growth.
North America followed by Europe to dominate Virtual Office market
North America followed by Europe dominated the global virtual office market in 2020. The growth in these regions can be attributed to high consumer preference toward flexible working. United Kingdom and the U.S. are mostly matured in virtual office market. Factors such as inflexible lease terms, growth of IT sector, and lack of conventional office spaces drove the demand for services of virtual offices in these regions. In Europe, EU law allows businesses of EU member states to cater their service across Europe, owing to which huge increase in virtual office setups were witnessed in the recent past. According to Office Suites Club, virtual offices in EU member states in the wake of Brexit provides cost-effective business opportunity while retaining their position. Furthermore, Ireland’s corporation tax rate (12.5%) attracts foreign businesses. Such factors are projected to drive the demand for virtual offices in the extended run.
Furthermore, growing investments in micro, small and medium enterprises (MSME) is likely to increase service demand globally. For instance, Innovative Small and Medium Enterprises (iSME) project in Lebanon invested an amount of about USD 10.23 million across 22 firms. Additionally, Small Industries Development Bank of India (SIDBI) aims to indirectly disburse USD 1.5 billion to start-ups by 2025. Growing investments in micro, small and medium enterprises (MSME) coupled with their high adoption of hybrid working model is further likely to drive virtual office market growth.
Some key players in the global virtual office market are Alliance Virtual Offices, Davinci Virtual Offices, Intelligent Office, Northwest Registered Agent, LLC, OBC Suisse AG, Office Evolution and its affiliate, Opus Virtual Offices, Regus Group Companies, Rovva, Servcorp, Sococo, The Executive Centre, thinkspace, and Virtual Headquarters amongst other market participants.
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Global Virtual Office Market:
- By Services
- Live Receptionist Answering Calls
- Corporate Mailing Address
- Company Phone Number
- Online Fax Service
- Voice Mail Converted to Email
- Other
- By Pricing Model
- Monthly
- Annually
- By End-User
- Startups
- Small and Medium Sized Enterprises
- Large Enterprises
- Others
- By Region
- North America
- U.S
- Canada
- Mexico
- Rest of North America
- Europe
- France
- The UK
- Spain
- Germany
- Italy
- Nordic Countries
- Denmark
- Finland
- Iceland
- Sweden
- Norway
- Benelux Union
- Belgium
- The Netherlands
- Luxembourg
- Rest of Europe
- Asia Pacific
- China
- Japan
- India
- New Zealand
- Australia
- South Korea
- Southeast Asia
- Indonesia
- Thailand
- Malaysia
- Singapore
- Rest of Southeast Asia
- Rest of Asia Pacific
- Middle East & Africa
- Saudi Arabia
- UAE
- Egypt
- Kuwait
- South Africa
- Rest of Middle East & Africa
- Latin America
- Brazil
- Argentina
- Rest of Latin America
- North America
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