THE complete Guide to Satellite Offices
Location is no small question for a company. You're looking for the right balance between cost, convenience, and business prospects. But these aren't one-time considerations; companies continue to face the location question as they grow and evolve.
Whether your company is a startup with a small, dedicated team or a large, established corporation, where you're headquartered doesn't have to limit where your company operates. And today, it's easier than ever to run a company without being centralized in a single place. Satellite offices are one common solution.
Before we go any further, let's define what a satellite office is:
A satellite office is a branch of a larger company that is physically separate from the organization's main office.
Satellite offices can range dramatically in size, housing anywhere from one employee to hundreds. Likewise, companies both big and small may elect to invest in satellite offices, depending on the specific needs of their business.
Below you'll learn more about who uses satellite offices and why they're useful, plus the essential information you or your company should know about finding the best fit.
WHAT KINDS OF COMPANIES USE SATELLITE OFFICES?
Companies across industry and size use satellite offices to develop their businesses strategically. Many companies who open satellite offices will fall into one of these three categories:
1. Businesses that are growing
As your company hires for more roles, there may naturally come a time when you just need more space. Rather than transferring your entire operation to a new site, opening a satellite office allows you to retain the benefits of your existing space — whether that's the perfect location, low real estate costs, or simply the convenience of avoiding a mass migration and staying where you are.
Even if a company does plan to move, a temporary satellite office can come in handy as overflow space during the transition. Shared office environments make this particularly easy by offering serviced spaces on month-to-month or other short-term, flexible rental agreements. In addition to less logistical labor upfront, a flexible rental offers a helpful buffer in cases of drawn out build-outs (we’ve all been there). There’s no reason to pause a company’s growth to wait for walls, floors, desks, and chairs.
Companies with satellite offices might be expanding their offerings or emerging in new markets, so they’ll want some staff on the ground to network, learn about the local culture, or handle in-person logistics. In some cases, depending on your industry and the particular market you hope to reach, local connections can truly be the difference between success and failure.
To give you an example, startups looking to expand into Japan often struggle when they do so without having built up connections on the ground, as well as familiarizing themselves with key aspects of Japanese culture, according to Lia Camargo, Japan Partnerships Associate at CIC Japan Desk. Camargo recommends that companies interested in setting up a branch in Japan or working with Japanese partners research the existing market, find out who the key players are in the growing startup scene, look for opportunities in regions outside of Tokyo, and learn basic Japanese words and phrases.
2. Businesses looking to cross-pollinate
We always hear about competition in business, but we far less frequently talk about the power of collaboration. Many of today's most innovative companies seek partnerships with other businesses to bolster their own, finding that looking outside the walls of their own operations is actually vital to their long-term success.
In this blog post on corporate innovation, CIC member Dina Routhier of Stanley Ventures says, “The best corporations realize they can't go at it alone.” Her job entails identifying and networking with promising startups whose technologies can enhance the product offerings of the venture fund's parent company, Stanley, Black, and Decker. In exchange, the startups receive investment.
In other words, collaboration allows corporations to transform potentially industry-rocking competition into mutually advantageous partnerships.
Establishing a satellite office in a hub of startup activity, such as a coworking space, sets up your company to jumpstart such collaborations and think outside the box. You'll be positioned to network organically, stay in the center of industry trends, and promote your products, services, or events to a receptive community.
3. Businesses targeting specific talent pools
Employees are referred to as “talent” for a reason: When you're hiring, you're not looking for just anyone to fill a position. You're looking for the right person to join your team. And just as a company seeks the best candidates, potential hires look for the best possible fit in an employer. So how do you attract top talent? One way to do this is to go where the top talent is. Literally.
When companies decide where to open satellite offices, they might take into account the talent pool in respective locations. They might even open a new office specifically to tap into the talent of a certain region, city, or neighborhood.
While businesses obviously want to stand out, there is some power in numbers. A place known for its opportunities for specific skill sets or fields naturally attracts candidates in search of those opportunities. Think software engineers and venture capitalists flocking to Silicon Valley, or actors to LA.
Local institutions like schools and training programs are part of this equation too, as they're often producing the talent of that area. For example, Boston consistently ranks as one of the top cities for startups; in 2017, it ranked first by the US Chamber of Commerce for the second year in a row. Among the cited factors? Talent. The city's many universities, including some of the world's most prestigious institutions like Harvard University and MIT, create a steady flow of new talent, and a plethora of work and funding opportunities make Boston an attractive place for some of the best and the brightest.
Companies with strategically placed satellite offices have often considered hiring opportunities as part of their market assessments wherever they set up shop.
BENEFITS OF SATELLITE OFFICES
Satellite offices offer a variety of benefits to companies, depending on their unique business models and goals. Here are some of the most common benefits of satellite offices:
We've established how talent can figure into the decision to open a satellite office and where. But once you've set yourself up with access to the kind of talent you're looking for, how do you get those people excited about the prospect of working at your company? Satellite offices can actually function as a recruitment tool, if done correctly.
Think about what a potential employee might find attractive in a workspace: Is the office easy to get to? Does it come with amenities such as onsite showers, a gym, a snack-filled kitchen, or a handful of tasty lunch spots within walking distance? Will employees have the opportunity to travel to other company offices in desirable locations? Is your satellite office a comfortable, inspiring space to spend time in?
All of these factors and more can influence one's impression of your company, impacting their eagerness to become part of your team. Building a satellite office where people want to work helps make your company a place where people want to work as well.
Another potential benefit of satellite offices is cost. While a company may require a space in a particular location due to visibility, traffic, or where their customer base is, it may not be necessary for all staff members or teams to work in that same physical space. If a company can get the same work done away from its main office at a more affordable rate, it may invest in a satellite location to establish or maintain a presence in another location at the same time.
In the day-to-day, it might feel like an office is an office is an office. But that's not necessarily the case for people outside of your company, especially those who aren't yet familiar with what you do.
A reputable address can feed directly into the perception of your company among potential clients, partners, investors, or other industry players. Your address is like a first impression, and it tells part of your company's story. Having a satellite office at a well-known and respected location can also set the tone for everything from business meetings to interviews to networking events that you may host.
You are the company you keep, right? In business, this proverb speaks to more than moral character: who you surround yourself with influences who you do business with. After all, business connections are people connections.
Satellite offices give you an opportunity to choose who the members of your company will strike up conversation with while grabbing their morning coffee or who they'll bump into in the elevator (they don't call it an elevator pitch for nothing!).
This is one important reason why companies flock to business districts rich in partnerships, such as University City — where CIC Philadelphia operates shared workspace in collaboration with civic innovation hall Quorum, BioLabs, Wexford Science+Technology, and University City Science Center — or industry hubs like Kendall Square in Cambridge, MA, which is known for its high density of startups, life science, and biotech companies. Even if an organization isn't based there, it can still establish a presence that translates to increased name recognition, opportunities for collaboration, and a stronger contact list, faster.
Proximity to New Markets
Along those lines, satellite offices make it easier for companies to enter new markets by becoming immersed in those local communities. A physical presence offers you the opportunity to learn about norms and customer preferences in a new place, and to meet with potential collaborators and clients.
HOW TO FIND THE RIGHT SATELLITE OFFICE: FACTORS TO CONSIDER
Investing in a satellite office is just that: an investment. To make sure it's a successful one, here are ten things to consider before taking the plunge:
Before you start making any plans or decisions, think through your intentions in opening a new office. What do you hope to achieve, and how does this fit into the larger strategy of your company?
Are you trying to increase revenue by tapping into an international market? Are you trying to attract talent or provide current employees more flexibility? The more specific your goals, the better. For instance, perhaps your company wants to establish itself in an industry hub. What outcomes for your company would make the time, logistical, and financial costs of setting up your satellite office worthwhile?
Knowing your objectives and the specific steps you will take to achieve them ensures that you grow with purpose and allows you to measure your success.
As we’ve discussed, where you open a satellite office can have many implications for your business. In many cases, seeking to establish a presence in a particular location is the main motivator behind a satellite office. But even if location isn’t your central concern, it’s worth considering how different options will impact various aspects of your company.
Once you’ve determined whether your satellite offices belongs in Manhattan or Montana, weigh the pros and cons of certain neighborhoods and even specific offices — from employee and customer experiences to rent prices to collaboration opportunities, as well as competition.
3. Your Neighbors
As you consider the right location for your satellite office, identify what type of community will best help you achieve your goals. If you’re a startup looking for growth opportunities, do your research to find a location near VCs or corporations aiming to increase their innovation efforts. If you’re setting up a new office for sales staff, a high-density area that houses the kinds of companies you’re looking to land as clients could be the right move for you.
Networking doesn’t just take place within the confines of networking events or pre-arranged meetings. It happens naturally throughout your day, wherever you go.
The ease of getting to and from the office impacts who will apply to work for your company, and how happy employees will be once they’re there. There are multiple implications for employers.
For one, fewer modes of transportation that can be used to reach your office means more restrictions on your applicant pool. Second, companies are increasingly looking at transportation as an aspect of sustainability, as well as employee wellness. An office easily accessible by public transit, biking, or walking can support your initiatives to make your workplace a health and environmentally conscious one.
As with your main office, take note of accessibility features of your satellite office for people with various ranges of mobility or other accessibility needs. These features may be essential for members of your staff either now or down the line, and creating an accessible space from the get-go prevents you from having to make corrections or pay for expensive changes later on. Plus, you’ll be making an important cultural statement that employees and clients with disabilities are welcome at your organization.
5. Inter-Office Logistics
Though physically separate from a company’s main location, satellite offices continue to work in tandem with headquarters to varying degrees. In some cases, employees will have the opportunity to shuttle between offices, or regular travel to the company’s main office may be essential to one’s role. Depending on the structure of your company and the work you do, frequent inter-office travel might influence where you should open a satellite office. Think about how convenient it will be to get from one office to the other in terms of cost and transportation options.
Also keep in mind other logistical considerations such as time zone differences and what methods of communication you will use between teams across offices.
6. Space Needs
When determining how much space you need, start with how many employees you expect to work in your satellite office. But to take it a step further, think about how your employees work. If your company allows employees to work remotely or if some satellite office staff will be traveling frequently, you may not need as many desks in your new space in order to accommodate everyone who will come into work.
To avoid unnecessary space crunches and moves in the future, keep in mind your growth projections. If you’re hiring very quickly after a successful funding round, for example, it might make sense to rent a larger office than you currently need. Whereas if you’re adding one new team member per year, your company may be better off saving costs with a smaller office and expanding on a new lease term down the line.
In addition to how quickly your company is growing, also consider if you anticipate needing your satellite office for six months, six years, or indefinitely. Quickly growing companies, or those with short-term space needs, may benefit from flexible rental agreements rather than traditional office leases.
Fortunately, the office market has shifted in recent years to accommodate the flexibility that businesses need as they expand, contract, evolve, pivot, and react to ever-changing circumstances.
In fact, the number of shared office spaces around the world nearly doubled from 2015 to 2017, while the number of coworking members more than tripled during that time, according to GCUC. And it’s no longer just solopreneurs and startups who utilize coworking; organizations of all sizes, including government agencies and multinational corporations, have embraced this office model.
Furniture is an essential part of your satellite office. What brand of desk or the width of couch you get may seem irrelevant to your business and therefore unimportant. But you’ll be doing yourself a favor by figuring out how you plan to furnish your office sooner rather than later. One tool for doing this is the Wayfair app, which uses augmented reality to show you what their furniture will look like in your space.
Will you buy new furniture, used furniture, or rent? Or perhaps your company would be best served outsourcing this work by renting an office that comes already furnished.
Remember: furniture decisions, coordination, setup, and maintenance don’t only cost you money — they cost you time that could otherwise be spent focusing on your business.
9. Tech Needs
Go into your new satellite office with a plan on how to handle your tech requirements. When your company isn’t housed all under one roof, proper technology for easy, reliable communication is more essential than ever. In addition to fast, reliable internet coverage in every inch of your office, you will likely want to invest in high quality phone and/or video conferencing platforms.
Make sure, also, that any space you think about moving into can handle whatever specific tech infrastructure needs your company has without too much added cost. Some serviced offices have staff who can do this for you, so be sure to ask when you inquire about space or visit their facilities.
A lot of resources go into making sure an office is a well-functioning, productive workplace. What resources will be available to employees at your satellite office? Account for essentials for getting the work done, as well as those offerings that make your company a welcoming, pleasant one — both physically and culturally.
For startups or companies working with lean budgets, amenities and perks may seem like a luxury reserved for Google or Facebook campuses. But providing your employees a positive workplace experience with tangible benefits gives you an edge in your hiring process, especially when you’re hiring from the same talent pools as some of those bigger, established businesses.
Published September 28, 2018.