A Cheap Virtual Office: It Does Not Always Work

By Stephen Furnari - November 11, 2014
A Cheap Virtual Office: It Does Not Always Work

A low-rate virtual office agreement may sound ideal, but it does not always work for everyone. If a virtual agreement lacks adequate services, it can leave an attorney scrambling and unable to practice law to the best of his or her ability.

virtual officeIn the New York City area, a virtual office can be found very cheaply. For many, a low monthly cost sounds like a great deal and is often the deciding factor for whether or not a prospective will sign on the dotted line.

Without even realizing it, a deal with an extremely low monthly is often to good to be true and this can end up being incredibly expensive because you get what you pay for in the end.

What is a virtual office?

Virtual offices are financial contracts where the prospective client pays a low monthly fee to use the commercial address and typically any services or amenities provided by the shared space. Access to these amenities is often critical to an attorney’s success. Services such as conference room time, internet, and even office equipment make the life an attorney so much easier.

Why do lawyers use virtual offices?

Attorneys use the virtual office arrangement for a variety of purposes. The main reasons a virtual office may be selected as an adequate choice are:

1.  Sometimes the cost of a traditional office rental is out of reach for an attorney making the virtual office the only adequate option; this allows the attorney to build his or her career to a place where a traditional office is in financial reach.

2.  Referral systems are typically unmatched compared to not having the virtual space. A legal community is powerful and helps to get an attorney’s name known and build repute.

3.  It is a powerful marketing tool in building the professional image of the attorney’s firm.

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

Virtual Office“Full-service” virtual office operators essentially give their tenants the equivalent of a traditional office rental; however, the parameters of the contract are much less less restrictive and provide flexible agreement terms. It is typical for mail services to be included, but what also comes with it is access to valuable resources like offices, conference rooms, and fully-staffed guest reception.

Low monthly office addresses are often too basic and just supply the address. The tenant pays to use the commercial address, but does not get the services that are intracle to supporting an attorney in his or her endeavors. This means no guest reception and generally no available conference room time. It’s just a place to get your mail dropped off and nothing else.

The address you claim may not be the place you meet clients.

If a business has little to no interaction with clients, then a cheap virtual office arrangement with no amenities may be the way to go, however, a lawyer’s job is all about client interaction. Every important event in a case such as a deposition, client consultation, closing, and so forth require a face-to-face interaction to ensure clear and concise communication. These interaction typically require some type of setting (i.e. conference room) to adequately conduct the meeting.

Client confusion is never a pretty sight and the explanation of not meeting at the designated office address can be colossally confusing to a prospective client. First impressions are everything in business and if a client remembers he or she felt confused when meeting, it does not bode well for your image and can affect your financial gains over time.

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

Virtual OfficeDo not think that you are getting a deal with very cheap virtual office rentals. Cheap virtual office providers make their money elsewhere and that is typically with basic services. In very low fee agreements, it is common for the provider to charge for every piece of mail received. If one has a lot of client mail, the costs can be outrageous for your bottom line.

Cheap virtual offices charge fees…for everything. Think about the receiving of mail; there’s a charge for that. What if you want it placed in an envelope and mailed? There’s a service charge for that as well in addition to the postage fee. All of this adds up to being many times the charge of what the cost to really forward the mail is.

Full service providers differ by typically charging only a small handling fee to package all your mail. The Law Firm Suites fee is currently only $2.00, much less than “cheap” virtual office providers.

Fees for “packages” will set you back more.

Several 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.

When this package limit is exceeded, an account will be charged subsequent fees that include any other fees such as postage, service, and so forth just to have it sent to you.

Most full-service arrangements will not charge excessive fees and do not limit the amount of packages one can receive at the address. At Law Firm Suites, clients typically pick up packages or they have it forwarded. No additional handling fees are charged to the client’s account.

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.

Full service virtual agreements meet standards and ethics frequently and this typically means you get everything that comes with the traditional office without the long-term commitment.

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

Virtual OfficeCheap virtual office can be a sound investment if it is what is right for your firm or for your current situation, especially if one is just starting out. A cheap office may be beneficial if one does not receive a lot of mail and can swing the hourly conference room rentals.

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.

Get our eBook: “Virtual Lawyer’s Dish: Strategies for success”

About Stephen Furnari

Stephen Furnari is a self-employed corporate attorney and the founder of Law Firm Suites, the operator of coworking spaces for law firms. Through Law Firm Suites, Furnari has helped hundreds of attorneys launch and grow successful law practices. He is the author of several eBooks, including “7 Deadly Mistakes that Prevent Law Practice Success” and “An Insider’s Guide to Renting the Perfect Law Office”. Stephen has been featured in the ABA Journal, Entrepreneur, New York Daily News and Crain’s New York. Connect with Stephen on Twitter (@stephenfurnari).

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