Viable alternative for cost-effective solutions

Viable alternative for cost-effective solutions

Ari A. Rachmat
Contributor
Jakarta

You wish to have an office of your own, but you do not have
sufficient funds? Well, not to worry. By renting a serviced
office available in the city, your wish is easily realized.

As the name implies, a serviced office is an office that comes
complete with the related "content", be it hardware and software,
such as furniture, telephone, fax, computer, and if you need
them, a secretary, an office boy as well as a security guard.

In some ways like renting a room, the rental period of
serviced offices (SO) is quite flexible as one can rent it just
for a day or two or for years. Naturally, lower rates are applied
for the longer rental periods.

That's why a serviced office has become a viable option for
innovative and cost-effective solutions for specific
accommodation needs.

The local SOs have emerged in answer to the need of foreign
corporations to open their representative offices in Indonesia as
they saw profitable business opportunities due to the decreasing
value of the rupiah. Some of them established not too long ago --
in 1997, that is -- the number of companies providing serviced
offices has, in comparison to similar businesses in the region,
in fact enjoyed a relatively rapid growth. Some of them are
purely domestic companies, while others are owned by foreign
investors.

Most of the Jakarta based SO companies -- at least six of them
-- have chosen the city's bustling central location popularly
referred to as the "Golden Triangle" to provide their products.

CEO Suites is one that is located at both the Jakarta Stock
Exchange and the Indonesian Batik Cooperatives buildings. HQ
Global Workplaces has picked Wisma Ariobimo; The Executive Centre
Indonesia has selected the Danamon Aetna building; Plaza Business
Centre at Menara Kadin, while Jakarta Serviced Offices (JSO) have
opted for Wisma 46 to market its offices.

Though fewer in number than those in Singapore, Hong Kong or
major cities of developed countries, the local SOs can match the
quality of services provided by their foreign counterparts.

"Just like a reputable star-rated hotel, we also assure our
clients of high quality service," said Indra Sakti, manager of
Jakarta Serviced Offices.

The presence of foreign owned and internationally affiliated
SOs in Indonesia certainly makes the business more competitive.
One of them -- established here in 1997 -- is the Executive
Centre Indonesia (ECI) with its head office in Hong Kong and
current networking affiliates in 12 countries.

Bearing a global brand, obviously, ECI provides international
standard quality, as stated by its manager, Rosaline Mayapada,
"our entire system and manpower have to conform to the standards
set by our Hong Kong office". However, their rates for fully
furnished and fully serviced offices -- ranging between US$650
and US$1,950 per month -- are not much higher than those offered
by local players.

Though the country's economic condition has not improved much,
SO businesses seems to be unaffected. Most of the offices have a
high occupancy rate. For example, JSO, said Indra, still had a
stable number of tenants as its 42 offices enjoy an 85 percent
occupancy rate most of the time.

Likewise, Rosaline said, that her company's 36 offices have
been fully booked from day one. "45 percent are occupied by the
same tenants from the first days we opened business here, while
the rest are also mostly our regular clients," said Rosaline.

In addition to Indra and Rosaline's optimism about the future
of such business in Indonesia, the payment status of the tenants
is also another positive indicator. According to Indra, despite
the country's weak economy, his clients pay their rent on time.
"Sometimes I wonder ... everybody is lamenting about our economic
situation, but we keep getting clients and the number is on the
rise plus they pay the rent regularly, which is in dollars, right
on time," Indra commented half musingly.

Though not mentioning any specific figures, both Indra and
Rosaline agreed that their companies' sales trend was definitely
healthy.

Yadi Budhisetiawan, a business observer of Force Once
marketing consultancy, attributed the success of serviced offices
to the practical attitude of a number of business people who
prefer this kind of hassle-free premises for their short or long-
term operations.

"Apparently renting a serviced office, especially for new
companies, is highly efficient as it does not require a huge
investment," Yadi said, while also concurring that the business
had a bright future.

Yadi suggested, however, that SO companies should be more
aggressive in their marketing and promotional activities. Rather
than relying merely on the current word-of-mouth strategy, they
should resort to a more integrated marketing program, which could
include such things as direct mailing, direct selling etc.
Another vital aspect, Yadi added, was that further intensive
training should be provided for the support staff involved.