Starting a business means balancing operational efficiency and credibility, which, in our digital age, are often mutually exclusive (e.g., the benefits of remote teams vs. the lacklustre credibility associated with a residential business address).
For many small business owners or startups, leasing a traditional office space in Singapore demands high capital, long-term commitment, and a lot of overhead. Renting a virtual office solution in Singapore, on the other hand, offers an appealing alternative: you get a professional address to use for business applications (e.g., corporate bank account, ACRA registration) without the risk and cost of a physical office.
Below, we break down why a virtual office often outperforms a traditional office lease, especially for businesses that don’t need daily on-site operations. These are businesses that run remote teams or value flexibility to support rapid growth.
A traditional office is a physical working space in a business district where employees go to work. This is typically leased space in a corporate building, which the enterprising founders have to renovate and outfit with furniture and work facilities.
These offices are typically tied to long-term lease agreements, usually over a year. Offices also have to pay for their electricity, WiFi, water bill, and other utilities. These are not provided by the building.
A virtual office, on the other hand, is a space that receives mail and correspondence from the government, the general public, and customers. Its highlight feature, however, is that founders may register this space when signing up for ACRA and corporate bank accounts, and may also include it in their marketing and communications. As a result, the startup would appear to have a professional business address situated in a business district.
This gives a virtual office credibility and protects the founders’ privacy, since they wouldn’t have to register their personal residential address (which is where startups typically operate).
The main differentiators between a traditional physical office and a virtual office include:
| Factors | Traditional Office | Virtual Office |
| Costs and Overhead Incurred | A traditional office lease requires you to rent physical office space, pay for utilities, and manage maintenance. Founders would also have to purchase their own furniture and work equipment. | A virtual office only provides a business address and administrative services. These services can be as low as 13 cents a day (Parkway Suites). |
| Staff Required | With an office lease, you need front-desk staff or receptionists to receive and direct correspondence for you. | With a virtual office, you rely on virtual office services like mail handling, which are already included in the rental rate. |
| Agreement Commitments | Leasing a traditional space usually means a long-term commitment. These are typically more than one year, locking you in. Otherwise, you forfeit the deposit. | Many virtual office providers offer flexible virtual office plans that founders can opt out of or upgrade at any time |
| Scalability | A physical office ties you to a fixed cost (square foot rent). This cost remains the same regardless of how often the office is used, or how much of the floor space is utilised. | Offices don’t rent space when it comes to virtual offices. They subscribe to services. A virtual office often scales with your needs, in that you pay for what you use. (e.g., You wouldn’t be paying for coworking space hours if you didn’t use the coworking space.) |
| Work Arrangement | A leased office provides a physical space where staff can work and gather onsite. | A virtual office is not a physical workspace. Employees can’t work there, so founders must rely on remote teams that operate from home. |
With these in mind, we’ve outlined notable reasons why renting a virtual office can be the better choice for startups and small businesses, especially those looking to focus on running an efficient, goal-focused business.
Startups and small businesses should be looking to immediately establish clientele and credibility with the limited resources they have. Because of this, it’s imperative that they focus their time on core operations rather than worrying about housekeeping, admin, and the associated costs.
Virtual offices, therefore, are an excellent choice for startups looking to establish presence in the market. They provide the following benefits over traditional offices, which can cultivate business growth:
Utilities are some of the biggest costs that come with maintaining physical office space.
Electricity, water, air-conditioning, and internet can add a significant amount to your monthly expenses. These costs are consistent whether your team works on-site full-time or uses the office only a few days per week. It eats into the budget of small businesses, hindering potential growth and opportunities.
With a virtual office solution in Singapore, you avoid these expenses entirely. The virtual office provider covers the utilities for the building. You get access to essential features without absorbing the price of running a traditional office. This helps business owners redirect funds to product development, hiring, or marketing that would otherwise have gone to a conventional office’s utility bills.
A leased office often requires reception staff, administrative help, and housekeeping staff. These roles are valuable, but they raise monthly labour expenses, which can strain small businesses. This can slow down cash flow for startups, especially since it’s best for these businesses to allocate resources to core operations.
Virtual office services remove that burden. Providers offer professional mail-handling service to support the company’s administrative needs for them, so subscribing founders won’t have to employ staff full-time for those roles. Also, the absence of a traditional workspace removes the need to hire housekeeping staff.
This allows startups and small businesses to focus on hiring for their primary goals and functions.
A physical office lease limits company growth. Whether your team uses the office for eight hours a day or barely steps inside, the monthly rent stays the same. As a result, businesses may pay for extra square footage they do not use. They must also renegotiate leases or relocate when they expand.
Furthermore, leases are often long-term agreements. If startups have to terminate the contract early, they won’t get the deposit back.
Virtual office plans, on the other hand, offer scalable options that match subscription fees to company growth. You can start with a basic virtual office address and add other services later. If you need coworking spaces, they can be booked on an as-needed basis.
You pay only for what you use. This makes virtual office members more agile and reduces the pressure on small businesses trying to control their operational expenses.
Traditional office spaces are set up, built, and organised for the company’s base of operations. This means that in order to fully utilise this “investment”, companies must require employees to work on-site. This, on its own, already comes with its share of challenges, especially after the pandemic has shifted working preferences to remote setups. With traditional offices, companies must also maintain equipment, internet plans, and furniture for every department, even when teams prefer working remotely.
Virtual offices suit hybrid and remote teams. Staff can work from home, a coffee shop, or overseas, while the business maintains its professional office address in a central business district. Founders also avoid paying for office equipment and on-site internet, giving the company freedom to adapt on the fly without the weight of a fixed physical office.
Signing a lease involves the following upfront purchases:
These upfront costs can be overwhelming for a small business owner launching a new venture. It also ties up money that could be used for hiring or product development.
A virtual office removes most of these expenses. You pay for virtual office plans, skipping the above costs entirely. These plans come at an affordable subscription that founders can opt out of, alter, and upgrade at any time.
Also, the virtual address is ready from day one, so you can begin operations immediately.
Physical offices require regular upkeep. Repairs, cleaning, and equipment replacement add to long-term costs. Maintenance also takes time and attention away from your main business activities.
When you rent a virtual office, you avoid these chores. Maintenance falls under the virtual office provider’s responsibility. This frees business owners from managing repairs and focuses their energy on their company rather than building upkeep.
Office reinstatement refers to restoring a leased office to its original state after your lease ends. This includes removing built-in furniture, repainting walls, and repairing floors. Reinstatement can be expensive and time-consuming, and the founders’ time, resources, and headaches are better spent on other projects. However, as cumbersome as it is, it is a standard requirement in commercial real estate, so companies cannot avoid it when their lease expires.
Virtual office solutions in Singapore remove reinstatement from the list of concerns. Since companies do not occupy and renovate the leased space (as there is no space to occupy and renovate), there is nothing to restore.
Virtual office subscribers can easily opt out of a plan if they have to. Since there is no reinstatement agreement tying them down, they opt out with no holding commitments. On the other hand, those that lease physical space may not be freed from their lease contract until they provide the necessary reinstatement renovation.
The main challenge posed by the lack of physical space can be addressed through digital tools and a remote culture. Most of these tools are free (e.g., Zoom, Google Workspace, Trello, Monday, Slack, etc.), and as a result, managing the drawbacks of having remote teams is low-cost.
Digital tools make remote collaboration smoother.
The drawbacks faced by physical offices, on the other hand, are less manageable. These include higher operating costs and teams bogged down by daily commutes and a skewed work-life balance. These issues are more complex and challenging to combat compared to the challenges of a geographically disconnected team, whose problems can be solved with Zoom and Slack.
In addition, when it comes to a virtual office, these providers offer physical space as needed. So, if you need to meet clients in person, for example, many virtual office providers offer coworking spaces that you can book as needed. Parkway Suites offers serviced offices for startups that need a physical workspace without worrying about renovations or office equipment.
If you’re ready to enjoy the cost savings and flexibility of a virtual address, Parkway Suites is a solid choice. We offer virtual office solutions at 60 Paya Lebar Road, with a registered office address and services such as mail forwarding, mail pick-and-go by driver, cheque drop services, and coworking spaces.
Our virtual office plans are scalable: you only pay for what you actually need, and you can cancel or change your plan at any time.
Get in touch with Parkway Suites today to explore our virtual office plans.
It’s best suited for businesses that don’t need daily on-site operations, such as remote teams, consultants, service-based companies, freelancers, and early-stage startups. Companies that need warehousing, retail floorspace, or daily in-person staffing may still require a physical location.
Common services include:
Yes. Many virtual office providers offer bookable coworking spaces, boardrooms, and serviced offices so you can host clients whenever necessary. Parkway Suites offers serviced offices that founders can use just like a regular office, minus the long-term lease and renovation needs.
Most virtual office providers, including Parkway Suites, offer serviced offices that you can transition into. This allows you to scale operations without starting from scratch or signing a long-term lease immediately.
Yes. Mail is securely handled by staff and can be collected or forwarded depending on your subscription. Professional virtual office services are designed to manage sensitive documents reliably.
Absolutely. A virtual office supports remote and hybrid setups, allowing staff to work from home, cafes, or even overseas while maintaining a Singapore business presence.
