Why a Cheap Virtual Office May Not Work for Lawyers.

By Stephen Perih - March 4, 2014
Why a Cheap Virtual Office May Not Work for Lawyers.

A cheap virtual office sounds like a great deal. Unfortunately, many cheap virtual offices do not provide the services necessary to effectively practice the law.

You can find a virtual office in New York City for as low as $24.95 a month.

It sounds like a great deal, right?

Just remember, if a deal sounds too good to be true, it probably is. Hidden deep within the fine print (if you can find the fine print at all) is the expensive truth: You get what you pay for.

What is a virtual office?

A virtual office rental is a financial arrangement where solo attorneys and small law firms pay a low monthly fee (typically starting at under $100 a month) to rent the use of a premium commercial address in an executive office suite and the non-exclusive use of office space and amenities, such as conference room facilities, a staffed reception area and access to professional grade internet, telephone, and office equipment.

Why do lawyers use virtual offices?

Different types of attorneys use a virtual office rental arrangement in different ways; however, the three main reasons attorneys elect to use a virtual office rental are:

  1. There’s a substantial cost savings as compared to traditional office rental;
  2. They get access to a community of other lawyers who can help with practice issues or send referral; and
  3. It gives the firm a professional image.

How is a cheap virtual office different from a full-service virtual office package?

cheap virtual officeWith a “full-service” virtual office operator, you essentially get the equivalent of a traditional office rental, just with a less restrictive economical financial arrangement. In addition to mail services, you get access to offices and conference rooms, and fully-staffed guest reception.

In New York City, full-service virtual office packages start at about $99 per month.  This covers use of the address, mail services and buys you access to the additional services, usually at discounted rates.

Cheap virtual office addresses are just that: addresses. You pay a provider a monthly fee to use their commercial mailing address and have your mail and packages received at that location.  Think of it like a more expensive post office box.  Conference room, guest reception, office rentals are generally not available.

Conference rooms may not be offered, requiring you to meet clients somewhere other than your office.

cheap virtual officeA cheap virtual office arrangement may be perfectly satisfactory for a business that rarely has physical interaction with clients; however, lawyer’s work differently. Law practices require consultations, witness prep, mediations; things that require face-to-face time with clients, usually sitting across a conference room table.

Imagine your client’s confusion when you have to explain to them why you cannot meet at your New York City office address, but instead at an office that isn’t yours, or worse, at the City Bar. It won’t make a good impression, and will certainly affect the hourly rate you can charge.

Cheap virtual office New York City operators charge for every piece of mail they receive.

cheap virtual officeMail fees are where most inexpensive virtual office providers earn their money.

For lawyers, mail is an occupational hazard. It is common for a solo law practice to receive 10 to 12 pieces of mail per day. If your practice involves personal injury work, multiply that by a factor of four.

Most cheap virtual office operators charge a flat fee of $1.00 per piece of mail they receive. Then they will charge you a $2.00 to $5.00 “envelope charge” to physically place your mail into an envelope. Then they will charge you a “postage fee”, which is typically 2x to 3x the cost of the actual postage required to forward your mail.

Assume you receive eight pieces of mail in your cheap virtual office. Those 8 pieces will cost approximately $15.00 to receive! Even if your mail volume averages 4 pieces a day, you will still be spending over $125.00 per month just on mail.

By comparison, with a full-service operator, your account is generally not charged for each piece of mail received, instead, a small handling fee is charged to package all your mail for forwarding and postage is billed at cost.  At Law Firm Suites, this fee is currently $2.00.

Additionally, many “cheaper” virtual office providers will not let you pick up your mail to avoid mail forwarding fees. Those that do often charge a $10.00 pick-up fee and have limits as to how frequently you can pick up mail in person.  One vendor we spoke with permitted mail pickup only twice a month.

Fees for “packages” will set you back more.

cheap virtual officeSeveral cheap virtual office providers limit the amount of packages you can receive. The most common arrangement is a five-package per month limit.

Operators frequently define a “package” as any item not delivered during the one daily USPS mail delivery.  So, anything dropped off by hand delivery, overnight courier or special handling is considered a “package”, no matter how small the item is.

If your package allotment is exceeded, your account will be charged $5.00 for each subsequent package, plus the envelope charge and marked-up postage fees to send it to you.

With most full-service virtual office plans, there is no fee to receive package, nor is there a limit to the number of packages received. Our clients typically pick up their packages, or we forward them to clients using their UPS or FedEx account.  No additional handling fees are charged.

Ethical restrictions may prevent you from using a cheap virtual office address.

Many jurisdictions have restrictions about what constitutes a bona fide office. In some cases, a cheap virtual office that is little more than a post office address cannot be used as an office address for a law practice.

Regulators often require that your office address be a place where clients can meet with you or find a representative of your firm.

A full-service virtual office arrangement frequently meets these ethical requirements. In most cases, you are getting everything that comes with a traditional office rental, just at an unbundled rate.

Do the financial math before you commit to a cheap virtual office. 

cheap virtual officeA cheap virtual office address can still be a good fit for your firm, particularly if you are just looking to “test the waters” in a new market. This is especially true if you do not expect to receive a significant amount of mail or packages, and if you can make due with hourly conference room rentals when you need to have client meetings.

But keep in mind, it’s a hassle (and expensive) to change a law firm’s business address. So when you are doing your math, if upgrading to more of a full-service location is part of your plan, factor in the cost of your time and the expense to change the firm’s business address when doing your cost-benefit analysis.

You may find that, overall, it may cost much less to go with more of a full-service provider from the beginning.






About Stephen Perih

Stephen Perih graduated Vassar College (no, it is not an all girl’s school) in 2005 before earning his JD from New York Law School. Stephen joined Law Firm Suites in 2012 as the Sales & Operations Manager. Since then, he has organized and emboldened Law Firm Suites’ community and accelerated the unique referral exchange among a rapidly growing roster of attorneys.

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