Many business owners wanting to change their working style will eventually look into how to start a virtual office business. Even though you no longer need a brick & mortar location, you still have to go through a few setup steps.
But what are the differences in the steps? What will you have to do in order to ensure your virtual office starts off on the right foot. Read on to find out the basics on how to set up and provide virtual office services.
Note: If you want to be equipped with all the tools to start a virtual office business, try Bonsai. We offer a business bank account, invoicing, proposals, contract and tax software to track expenses. All one place. Claim your 14-day free trial today.
A virtual office offers the same type of service as a physical office space (i.e., tools, workplace, equipment), but by means of the Internet.
Overall, the services that are often provided by a virtual office rental business include:
To put it simply, a virtual office business will provide a team with the necessary systems so that they can work remotely. They also offer the means necessary for you to improve your brand image, so that you may gain more potential clients.
Virtual offices come with various benefits that you may be able to enjoy. This includes, but is not limited to the following:
A virtual office space is quite easy to set up, as you won't need big startup capital. There aren't any long-term leases to worry about, nor are there any rental deposits that you need to remember.
Plus, with a virtual office, there's no need to spend loads of money on furnishings and office equipment. You also save money on daily consumables such as cleaning supplies, stationery, utilities, and so on.
With a virtual office business, the teams and the people running it get much better flexibility. Since you will not be stuck in a physical office, you will have a better work-life balance, mainly because you may organize everything yourself.
Plus, as less time will be spent commuting, one may use that time to either be productive or relax. As everyone will be able to work in an environment of their choosing, they shall also be much more productive.
Whether you need tax software such as Bonsai Tax, CRM software, or a checking account, it's easy to find most of these services online. This will allow you to get your virtual office space going in no time.
With a physical office, you would have to go through the procedures from one place to another, signing up for the necessary services. However, with virtual office services, it will only take a couple of minutes for you to sign up for them online.
Perhaps the best part about a virtual office space is that you can easily scale up your business if that is what you want. When your office space is in a virtual setting, you will no longer look for a bigger property, furnish new spaces or buy new equipment.
All you have to do is to increase your team size and perhaps update some of your subscriptions. You can also expand your business wherever you feel you may want it, as you aren't geographically bound to any office location.
Setting up virtual office businesses requires you to go through some steps. Sometimes, it may depend on the state where you are registering your virtual office service. However, for the most part, here is what you need to do if you wish to be successful.
To set up a virtual office, you need to first understand precisely what the industry entails. Owners of virtual offices pertaining to the leasing of serviced offices industry, and the operator will provide virtual tools as well as lease meeting rooms for those requiring the space.
As a result, while the majority of the business is done online, you also need an office facility available. People will be coming to you, so make sure that your location is in a district with a high business profile.
Like every other industry, not every virtual office will be the same. Some will rent or lease workplaces that were fully furnished. Others may lease virtual offices or outsourcing services. Some focus on telecommunications whereas others offer meeting rooms or conference rooms.
Like every small business owner, you need to figure out where your niche is. This way, you will be able to differentiate yourself from your competition so that you may bring the right clients your way.
If you don't select a niche and try to become a Jack-of-all-trades, then you may seem unreliable to teams looking for a virtual office. Here are some businesses to start if you have no ideas. Very often, these teams know what they want, and if they see that you don't have a focus on what they need, they may start looking elsewhere for services.
Once you grasped the business idea, it is time to create a business plan, just like you would with any other small business. While doing so, take a hard look at the needs of your business.
Some things that you may want to add to your business plan include:
Once you have a base idea of where you are planning to go with your business, you may be able to determine the staffing for your virtual office space, your resources, and any other needs. Having this plan up front is essential for the success of your virtual office rental business.
Virtual office businesses, unlike your regular startups, will need employees - especially as the business starts gaining speed. Remember, since most of the work is done remotely, you can hire people from pretty much anywhere - so, simply focus on hiring the right people for the job.
Many people are attracted by the idea of working in a virtual office, as it provides more flexibility. However, not everyone is really suited for this kind of work. Look for those that have the ability to focus and prioritize, have excellent communication skills, and have high intrinsic motivation levels.
You should also decide whether you want to hire personnel for payroll, HR, marketing, sales, and so on. If you don't, then you may want to outsource these tasks to a virtual assistant, as they can do most of these tasks. Make sure you thoroughly check the skills of those that you are hiring.
You may be an online business for the most part, but this does not mean you can skip on the business registration part.
Choose which type of legal entity you want to be (LLC, S-Corp, or C-Corp) and get a business license. You need to provide various pieces of information, such as your name, physical address, and virtual office address.
Make sure that you are also properly registered to the IRS. If you are making a profit from your virtual office rental business, then the IRS will want to know about it. This way, they can tax you accordingly.
To be a professional business person, you need your clients to be able to contact you. When you have a virtual office space, you may want to set up a virtual phone system.
This includes the main phone number of your virtual office, toll-free numbers, local numbers, call center services, and so on. The advantage here is that nowadays, you do not even need to buy hardware for these tools, as you may simply get a mobile application for your smartphone.
You may be the owner of a virtual business, but you still need a physical address where you can get your mail. You may receive tax papers, bills, letters, and all types of content designated for your business.
Some virtual mailing address companies will receive your mail, scan it, and then send it to your digital mailbox. This mail forwarding is a good option if you are the kind of business owner who is constantly on the road. Plus, all your clients will see is a professional address.
Moreover, you require an office address for your temporary conference room. After all, as a virtual office space, you have to provide a space where your people can meet with their respective clients. Select a business address for that as well.
As a virtual company, your online presence is essential to you. As a result, you should make sure that all of your online links are in order. For example, if up until now you've been using a Gmail account, then you should consider switching the email extension to the name of your company. For instance, firstname.lastname@example.org.
You also require a domain name and this usually comes with a fee. However, if you are looking for a more professional image, a domain name is essential to the virtual office owner.
Make sure that you choose the extension right. The most popular extensions include:
Each domain has its own benefits, so whichever you choose will make you look more professional.
When starting up a virtual office, you need to determine what tools you are going to use in order to kick off your business. Each virtual office arrangement is different, so you must see what pieces of software work best for you.
First things first, you need to set up a system to pay your employees or those that you are outsourcing to. An online invoicing tool such as Bonsai can help you make the payments online, allowing you to save both time and money.
Next, you need to think about a document management system. After all, since you won't be using an office facility with your employees and partners, you must be able to exchange documents somehow. Cloud storage may prove quite useful in this scenario.
Think about setting up a backup and recovery solution as well. There are many options that can help you out - cloud storage included. This way, if something goes wrong with your connection, you won't lose the data.
Last but not least, you should also get a tool that can help you with your virtual office productivity management. After all, your team will be working remotely, so you must make sure that they are keeping to their attendance records and are making actual progress.
You may have a virtual business structure, but this does not mean that no one will ever be talking to one another. Employees need to find information Also, lack of communication may cause them to feel isolated and completely out of the loop.
For this reason, as the owner of a virtual office business, you need to set up access to communication methods, as well as collaboration methods. This way, your team can still act like a team, even if they do not share an office.
There are some handy tools that you may use here. For one, you may get instant messaging apps to encourage communication and project management tools where you may lay down the tasks, promoting productivity. Social media, telecommunication services, and video conferencing may also be useful in this regard.
When you have a physical business location, it's easy to create an organizational system. However, outside the traditional office, it might be rather difficult to organize yourself. For this reason, a virtual office leader has to create an organizational office for their virtual office team.
First, you should set the working hours of your virtual office. You might think that remote work means no schedule, but without these hours, one of two things can happen: the employee may either work more than they should, or they may procrastinate and skip on their tasks.
Even if your staff lives in a different time zone, your workers should have a certain standard hour set that they will need to follow. Not only will this improve team productivity, but it will also help your people enjoy a proper work-life balance.
As a virtual office, you have to make a number of payments to the staff and suppliers and receive payments from those using your services. As a result, you need a checking bank account and a cash management system to handle your finances.
Bonsai Cash offers a physical card for those that wish to make such payments from a physical office address. They also offer virtual cards to those who are only using the virtual office. This way, regardless of their location, people should be able to make a payment with their phones or other devices.
The online bank also accepts credit card payments, collect invoice payouts, and tracks your expenses. You can take pictures of your receipts so that every expense is accounted for. If you just started out and you don't have an accountant yet, Bonsai cash can help you out.
Bonsai Cash has a very useful feature called "envelopes." This allows you to organize your finances with sub-accounts so that you do not accidentally overspend. For example, you may set envelopes for equipment expenses, taxes, payroll, and many more, putting the money there so that you don't tap into it.
Bonsai Tax is also a tool that can help track your expenses and allows you to keep your peace of mind during tax time. This software enables you to take pictures of your receipts so that you may set the money aside for tax purposes.
The Bonsai Tax software will automatically identify the expenses that are tax-deductible. This will make it easier for you at tax time, as you will no longer miss potential deductible taxes. In fact, the average users saves at least $5,600 from their tax bill.
The tax software will also track your income so that it can provide an estimated quarterly tax. It can automatically connect with your bank account or credit cards, importing and organizing your tax receipts.
A virtual office does not have a physical facility's challenges and overhead costs. In terms of benefits, it is a good choice for those who prefer a remote setup. That being said, you need to be careful how you set it up, especially if you want your business to be successful. Follow our guide, and you should be able to get a good start.
A verbal contract (formally called an oral contract) refers to an agreement between two parties that's made —you guessed it— verbally.
Formal contracts, like those between an employee and an employer, are typically written down. However, some professional transactions take place based on verbally agreed terms.
Freelancers are a good example of this. Often, freelancers will take on projects having agreed on the terms and payment via the phone, or an email. Unfortunately, sometimes clients don't pull through on their agreements, and hardworking freelancers can find themselves out of pocket and wondering whether a legal battle is worth all the hassle.
The main differences between written and oral contracts are that the former is signed and documented, whereas the latter is solely attributed to verbal communication.
Verbal contracts are a bit of a gray area for most people unfamiliar with contract law —which is most of us, right?— due to the fact that there's no physical evidence to support the claims made by the implemented parties.
For any contract (written or verbal) to be binding, there are four major elements which need to be in place. The crucial elements of a contract are as follows:
Therefore, an oral agreement has legal validity if all of these elements are present. However, verbal contracts can be difficult to enforce in a court of law. In the next section, we take a look at how oral agreements hold up in court.
Most business professionals are wary of entering into contracts orally because they can difficult to enforce in the face of the law.
If an oral contract is brought in front of a court of law, there is increased risk of one party (or both!) lying about the initial terms of the agreement. This is problematic for the court, as there's no unbiased way to conclude the case; often, this will result in the case being disregarded. Moreover, it can be difficult to outline contract defects if it's not in writing.
That being said, there are plenty of situations where enforceable contracts do not need to be written or spoken, they're simply implied. For instance, when you buy milk from a store, you give something in exchange for something else and enter into an implied contract, in this case - money is exchanged for goods.
There are some types of contracts which must be in writing.
The Statute of Frauds is a legal statute which states that certain kinds of contracts must be executed in writing and signed by the parties involved. The Statute of Frauds has been adopted in almost all U.S states, and requires a written contract for the following purposes:
Typically, a court of law won't enforce an oral agreement in any of these circumstances under the statute. Instead, a written document is required to make the contract enforceable.
Contract law is generally doesn't favor contracts agreed upon verbally. A verbal agreement is difficult to prove, and can be used by those intent on committing fraud. For that reason, it's always best to put any agreements in writing and ensure all parties have fully understood and consented to signing.
Verbal agreements can be proven with actions in the absence of physical documentation. Any oral promise to provide the sale of goods or perform a service that you agreed to counts as a valid contract. So, when facing a court of law, what evidence can you provide to enforce a verbal agreement?
Unfortunately, without solid proof, it may be difficult to convince a court of the legality of an oral contract. Without witnesses to testify to the oral agreement taking place or other forms of evidence, oral contracts won't stand up in court. Instead, it becomes a matter of "he-said-she-said" - which legal professionals definitely don't have time for!
If you were to enter into a verbal contract, it's recommended to follow up with an email or a letter confirming the offer, the terms of the agreement , and payment conditions. The more you can document the elements of a contract, the better your chances of legally enforcing a oral contract.
Another option is to make a recording of the conversation where the agreement is verbalized. This can be used to support your claims in the absence of a written agreement. However, it's always best to gain the permission of the other involved parties before hitting record.
Fundamentally, most verbal agreements are legally valid as long as they meet all the requirements for a contract. However, if you were to go to court over one party not fulfilling the terms of the contract, proving that the interaction took place can be extremely taxing.
So, ultimately, the question is: written or verbal agreements?
Any good lawyer, contract law firm, or legal professional would advise you to make sure you formalize any professional agreement with a written agreement. Written contracts provide a secure testament to the conditions that were agreed and signed by the two parties involved. If it comes to it, a physical contract is much easier to eviden in legal circumstances.
Freelancers, in particular, should be aware of the extra security that digital contracts may provide. Many people choose to stick to executing contracts verbally because they're not sure how to write a contract, or they think writing out the contract terms is too complicated or requires expensive legal advice. However, this is no longer the case.
Today, we have a world of resources available at our fingertips. The internet is a treasure trove of invaluable information, platforms, and software that simplifies our lives. Creating, signing, and sending contracts has never been easier. What's more, you don't have to rely on a hiring a lawyer to explain all that legal jargon anymore.
There are plenty of tools available online for freelancers to use for guidance when drafting digital contracts. Tools like Bonsai provide a range of customizable, vetted contract templates for all kinds of freelance professionals. No matter what industry you're operating in, Bonsai has a professional template to offer.
A written contract makes the agreement much easier to prove the terms of the agreement in case something were to go awry. The two parties involved can rest assured that they're legal rights are protected, and the terms of the contract are sufficiently documented. Plus, it provides both parties with peace of mind to focus on the tasks at hand.
Bonsai's product suite for freelancers allows users to make contracts from scratch, or using professional templates, and sign them using an online signature maker.
With Bonsai, you can streamline and automate all of the boring back-office tasks that come with being a freelancer. From creating proposals that clients can't say no to, to sealing the deal with a professional contract - Bonsai will revolutionize the way you do business as a freelancer.
Why not secure your business today and sign up for a free trial?