Everything You Need to Know about Virtual Office

A virtual office is a service that enables employees and business owners to work remotely by providing a range of business functions accessible through the internet. The virtual office concept has become a popular workspace solution for freelancers and entrepreneurs who work from home but want a professional-sounding business address for their company. It gives business owners all the benefits of a physical office without the expense of renting an actual office. A virtual business address can help to add credibility to a business, which makes it easier to successfully attract clients.

What is a Virtual Office?
Virtual Office Concept
History of Virtual Office
How Virtual Office works?
Advantages of a Virtual Office
Disadvantages of a Virtual Office

What is a Virtual Office?

A virtual office or virtual company refers to a company that may not have a fixed location yet functions as a unit to provide products and services to customers. It relies on the Internet heavily. Internet is used for document exchange, video conferencing for meetings and cell phones so employees can keep in touch. The office's employees might work at home or in different cites and countries i.e. it involves working remotely.

Essentially, a virtual office is a service which provides a business owner with an office address and telephone number, communication and administration services, and access to meeting rooms, all without the need for physical office space.

Virtual Office Concept

A virtual office is part of the flexible workspace industry that provides businesses with any combination of services, space or technology, without those businesses having the capital expenses of owning or leasing a traditional physical office.

Due to the digital revolution, traditional working environment will never be the same. In many cases, work is no longer the place you go to, but rather the tools, skills, and devices you need to have to complete a task, no matter where your location is. Many startups, small firms, and solopreneurs(entrepreneur who works and runs their business alone) are discovering the benefits of virtual offices. For instance, it enables organisations to create and maintain a presence in a desirable location without the need to pay rent for an actual space.

A virtual office can be defined as various work environments that can be accessed with the help of Internet and computer technology. Technically, you and your team can work from any corner of the world as long as you have an Internet connection, an app or a collaboration or conference tool needed for your work, that gives the same ultimate result as any physical office.

The virtual office concept has a great scope in future. For instance, Covid-19 has made many employees unintentionally get used to work from home. This will give a great boost to the virtual offices in coming future.

History of Virtual Office

The virtual office concept has existed since the early 1980’s and has changed over the decades with technology. For example, a 1980’s virtual office included a fax service, now this has been replaced with a scan to email service, in which physical mail is scanned and emailed to the client. Even though virtual offices have been growing in popularity over the last few years, the idea has actually been around for several decades. There’s been an ongoing debate about who coined the term virtual office.

According to an article published in 1982 in Infoworlds, John Markoff, a journalist,  first mentioned the term ‘virtual office. In the article, Markoff wrote that a virtual office would be built around a portable personal computer and local area network that would expand working horizons dramatically. Markoff also stated that in the future virtual offices, employees will no longer be constrained by computer equipment or geographic location. They would be free to travel or to interact with others while communicating information with right tools. The physical offices would not have the central importance it does today.


Also Read: How to Manage Remote Teams?


The first virtual offices were accurately installed in 1989 by Ralph Gregory in Boulder, Colorado. Ralph founded ‘The Virtual Office Inc’ because is first child was born and he wanted to be able to work from home and spend time with her.

Also in 1989, after taking a business trip to Belgium, English billionaire businessman Mark Dixon founded his company Regus that provided clients with executive suites at affordable prices. Though the company went bankrupt in 2003, it was able to turn things around in less a year after receiving financing from a business parent. It is now a huge global company, listed on the American stock market.

In 1990, the first Internet search engine was developed by McGill University. In 1991, the World Wide Web was released to the public. Also in the same year, the first webcam was developed at Cambridge University. In 1992, “Virtual Office” became a registered trademark for the first time when Richard Nissen registered the term with the UK’s Intellectual Property Office.

The first Symbian phone, the touchscreen Ericsson R380 Smartphone was released in 2000. It combined a PDA with a mobile phone. In 2003, Skype was released to the public as conferencing tool that allowed free IP-based communications using microphone, webcam and instant messaging to individual consumers. Thus, the virtual offices started actually after this.

Virtual Office meaning and benefits of virtual office
In the last decade, trend of Virtual Office has increased due to Internet

How Virtual Office works?

If your work involves traveling to client locations or other places away from your home base, you should probably consider buying a laptop computer rather than a desktop system. With a laptop one can always have their files, documents with them. Instead of laptop, one can also use tablets, iPad, etc. as these are many lightweight models out there that are very powerful. Just make sure you get a good carrying case that has a shoulder strap and room for your hard copy documents. Similarly, printer, fax machine, scanner, and other necessary peripherals to make a while system.

These Virtual offices operate as one unit to serve customers though do not exist physically. This type of set up is getting popular especially with startups and small businesses. The creation of web-based office productivity software and services, such as videoconferencing has helped drive the growth in virtual offices.

A virtual office concept can also lead to greater productivity, as its services free workers from administrative tasks, as well as travel. Each employee can work from the location that is most convenient, and the business is not restricted to hiring employees who live locally.


Also Read: 8 Tips to Stay Productive while Working Remotely


Advantages of a Virtual Office

  • First of all, it saves the cost needed for the office space. The monthly cost of a virtual office is far less than that of a traditional physical office. After all, it has none of the maintenance and staff costs. A virtual office solution saves on overheads, as there is no need to rent physical space, buy equipment and furniture, or hire a receptionist.
  • With a virtual office solution, business owners get an address within a reputable area code that is equivalent to a physical office so this reassures clients that the business is legitimate. A virtual office can also be secured via a month-to-month lease, so there is greater flexibility if a user's business changes.
  • As virtual office provides a mailing address, telephone answering, and videoconferencing services. Therefore, even small business can appear larger than it is. This is the reason why, it is so useful for startups and small scale businesses. It requires less management than the physical offices.
  • Working from home while using a virtual office address saves time and money that would otherwise be spent on a daily travel. It helps employees save their energy which is wasted in travelling. This helps them focus on work with more creativity.
  • Teams working virtually typically have the benefit of flexibility of working. So employees get more free time and flexibility. This helps maintain work-life balance in a better way.

Disadvantages of a Virtual Office

  • Virtual connections lack the social interactivity of face-to-face contact. Some believe that a disadvantage to working from a virtual office is the lack of social interaction between employees. Because many nonverbal cues can be missed in emails, phone conversations and video conferences and also messages can easily be misinterpreted.
  • Coordinating meetings may prove difficult especially if employees are residing in different countries. So the scheduling a meeting might create a problem due to differences across several time zones. Finally, collaborations will lack spontaneity because they have to be planned precisely to coordinate schedules and time zones.
  • On the downside, a virtual office means no physical office space is available to work from on a daily basis. The service package you will get from a virtual office space may be a limited one. For example, many packages come with limited use of conference rooms or limited teleconferencing and videoconferencing services.
  • Another disadvantage of working from a from a virtual office is the distractions and sometimes lack of motivation. These can sometimes cause morale and productivity to decline. Hence, a person needs to have self-discipline and work best independently with little supervision.
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About Varad Kitey

  • Pune