[Coworking] Re: Pricing - are we getting something wrong?
Hey Rob, That's cool that you can pass your awesome real estate deal onto your tenants. At Citizen Space, we do, too. Our operating budget is close to $9k per month Rent: $5,000 Utils: 1,000 (internet, cleaning, utils) Staff: $2,400 Extras: $ 500 (coffee, food, events, etc.) Total: $8,900 We decided to focus on permanent residents rather than doing the 'gym' or 'library' model of selling lots of monthly memberships without having permanent space. It's worked really well for us from the beginning and created a nice, permanent sense of community. We have 20 desks that we price at $425/month. Even if we sell all the desks ($8,500), we fall short. Therefore, we offer another level of rental (limited though), Citizen Lite at $350/month and charge for events (depending on the time and size of the event) to make up for it. We would have to sell 200 memberships at your rate in order to cover our costs and, well, the overhead of time on keeping track of this alone would raise our costs. I think you will find that, across the board, the coworking spaces you are looking at and scratching your head at (that have been in operation on a non-profit level by and large for many years) are pricing their spaces right. I hope that you can appreciate that, in Edmonton, the cost of real estate is vastly different that that of San Francisco or New York City or Houston. We all DO expect people will come in every day and make it their permanent work spaces. That's what makes for community for our spaces and it keeps them running and thriving. It's more beautiful to me to have that sense of community than to undercut and slash costs. And it works. So, "Are *WE* getting something wrong?" No. I don't think so. We've been thinking about this stuff for years and making sure the pricing works in everyone's favour. I'm happy for you that you can price so inexpensively. Congrats. Tara On Fri, Jun 19, 2009 at 10:47 PM, robdavy wrote: > > Hi Everyone, > > Quick question (kinda)... > > We're in the process of setting up a coworking space/hacker space here > in Edmonton, Alberta, Canada (metro pop of 1m). We're well underway, > non-profit registered, directors elected, space found, 40+ members > joined, etc. > > We're obviously working on a non-profit model, shared space, 24/7 > access, etc. > > My concern is pricing. Lots of places seem to offer what we're going > to be offering for many hundreds of dollars a month. We're going to be > doing it for $50. $50/month gets you unlimited access to our 3700sq ft > space. No permanent desks, but permanent offices will be offered for > around $250/month. Our's is not exactly a co-working space in the > sense we do not expect people to work here 9-5 (some will of course, > but most members have full time jobs and want the collaborative use of > the space, plus access to the equipment (machining, etc). Check out > http://d.ents.ca/ for photos > > Why $50/month? Our rent is $5/sqft + $2.87 operating. 3700sq ft @ $8 = > $2500/month ($'s are per year). So based on the non-profit model found > here http://coworking.pbworks.com/PricingExamples we need $3750/month. > Well, our utils are included in the operating, internet is free from > someones business via a point to point wireless connection, etc, etc, > so we're figuring max $500/month in misc costs. The landlord is also > giving us 2 months free rent. > > So say $3000/month, that's only 60 members @ $50/month each. We have > 40 signed up now (of course some will drop out, but we've still got > many coming in) and we'll cover more costs with offices rented. > > Is it just the cheap rent that is making our space $50/month and not > $300/month (or more!). > Why do some (most) places need to charge so much? > > Thanks in advance > > > Rob Davy > Edmonton New Technology Society > www.ents.ca > > > > -- tara 'missrogue' hunt Book: The Whuffie Factor (http://www.thewhuffiefactor.com) Blog: HorsePigCow: Marketing Uncommon (http://horsepigcow.com) Twitter: http://www.twitter.com/missrogue phone: 415-694-1951 --~--~-~--~~~---~--~~ You received this message because you are subscribed to the Google Groups "Coworking" group. To post to this group, send email to coworking@googlegroups.com To unsubscribe from this group, send email to coworking+unsubscr...@googlegroups.com For more options, visit this group at http://groups.google.com/group/coworking?hl=en -~--~~~~--~~--~--~---
[Coworking] Re: Pricing - are we getting something wrong?
Rob, My 0.02c: Bump up the price to $100, and put the excess cash into savings (in a good interest rate account), and keep it there for the rainy day that WILL come; or upkeep / improving / marketing / events / etc. You're still way below the competition, and if you run to lean for too long, you're going to have problems at some stage. Best ;-) Regards Gareth gareth.kni...@gmail.com http://www.oneafrikan.com/ UK mobile: +44 (0) 77 66 00 66 56 SA mobile: +27 (0) 72 62 79 21 2 twitter: http://twitter.com/oneafrikan skype: iamoneafrikan chat: oneafri...@hotmail.com | gareth.kni...@gmail.com about: http://www.oneafrikan.com/colophon/ photos: http://www.flickr.com/photos/garethknight/sets/ Due to email overload, I subscribe to this policy: http://five.sentenc.es/ 2009/6/20 robdavy > > Hi Everyone, > > Quick question (kinda)... > > We're in the process of setting up a coworking space/hacker space here > in Edmonton, Alberta, Canada (metro pop of 1m). We're well underway, > non-profit registered, directors elected, space found, 40+ members > joined, etc. > > We're obviously working on a non-profit model, shared space, 24/7 > access, etc. > > My concern is pricing. Lots of places seem to offer what we're going > to be offering for many hundreds of dollars a month. We're going to be > doing it for $50. $50/month gets you unlimited access to our 3700sq ft > space. No permanent desks, but permanent offices will be offered for > around $250/month. Our's is not exactly a co-working space in the > sense we do not expect people to work here 9-5 (some will of course, > but most members have full time jobs and want the collaborative use of > the space, plus access to the equipment (machining, etc). Check out > http://d.ents.ca/ for photos > > Why $50/month? Our rent is $5/sqft + $2.87 operating. 3700sq ft @ $8 = > $2500/month ($'s are per year). So based on the non-profit model found > here http://coworking.pbworks.com/PricingExamples we need $3750/month. > Well, our utils are included in the operating, internet is free from > someones business via a point to point wireless connection, etc, etc, > so we're figuring max $500/month in misc costs. The landlord is also > giving us 2 months free rent. > > So say $3000/month, that's only 60 members @ $50/month each. We have > 40 signed up now (of course some will drop out, but we've still got > many coming in) and we'll cover more costs with offices rented. > > Is it just the cheap rent that is making our space $50/month and not > $300/month (or more!). > Why do some (most) places need to charge so much? > > Thanks in advance > > > Rob Davy > Edmonton New Technology Society > www.ents.ca > > > > --~--~-~--~~~---~--~~ You received this message because you are subscribed to the Google Groups "Coworking" group. To post to this group, send email to coworking@googlegroups.com To unsubscribe from this group, send email to coworking+unsubscr...@googlegroups.com For more options, visit this group at http://groups.google.com/group/coworking?hl=en -~--~~~~--~~--~--~---
[Coworking] Re: Pricing - are we getting something wrong?
I was going to say exactly that. Thanks for writing it so I didn't have to. -Mike Sent from my iPhone On Jun 21, 2009, at 2:23 PM, Gareth Knight wrote: > Rob, > > My 0.02c: > Bump up the price to $100, and put the excess cash into savings (in > a good interest rate account), and keep it there for the rainy day > that WILL come; or upkeep / improving / marketing / events / etc. > You're still way below the competition, and if you run to lean for > too long, you're going to have problems at some stage. > > Best ;-) > > Regards > Gareth > > gareth.kni...@gmail.com > http://www.oneafrikan.com/ > > UK mobile: +44 (0) 77 66 00 66 56 > SA mobile: +27 (0) 72 62 79 21 2 > twitter: http://twitter.com/oneafrikan > skype: iamoneafrikan > chat: oneafri...@hotmail.com | gareth.kni...@gmail.com > about: http://www.oneafrikan.com/colophon/ > photos: http://www.flickr.com/photos/garethknight/sets/ > > Due to email overload, I subscribe to this policy: > http://five.sentenc.es/ > > > > 2009/6/20 robdavy > > Hi Everyone, > > Quick question (kinda)... > > We're in the process of setting up a coworking space/hacker space here > in Edmonton, Alberta, Canada (metro pop of 1m). We're well underway, > non-profit registered, directors elected, space found, 40+ members > joined, etc. > > We're obviously working on a non-profit model, shared space, 24/7 > access, etc. > > My concern is pricing. Lots of places seem to offer what we're going > to be offering for many hundreds of dollars a month. We're going to be > doing it for $50. $50/month gets you unlimited access to our 3700sq ft > space. No permanent desks, but permanent offices will be offered for > around $250/month. Our's is not exactly a co-working space in the > sense we do not expect people to work here 9-5 (some will of course, > but most members have full time jobs and want the collaborative use of > the space, plus access to the equipment (machining, etc). Check out > http://d.ents.ca/ for photos > > Why $50/month? Our rent is $5/sqft + $2.87 operating. 3700sq ft @ $8 = > $2500/month ($'s are per year). So based on the non-profit model found > here http://coworking.pbworks.com/PricingExamples we need $3750/month. > Well, our utils are included in the operating, internet is free from > someones business via a point to point wireless connection, etc, etc, > so we're figuring max $500/month in misc costs. The landlord is also > giving us 2 months free rent. > > So say $3000/month, that's only 60 members @ $50/month each. We have > 40 signed up now (of course some will drop out, but we've still got > many coming in) and we'll cover more costs with offices rented. > > Is it just the cheap rent that is making our space $50/month and not > $300/month (or more!). > Why do some (most) places need to charge so much? > > Thanks in advance > > > Rob Davy > Edmonton New Technology Society > www.ents.ca > > > > > > --~--~-~--~~~---~--~~ You received this message because you are subscribed to the Google Groups "Coworking" group. To post to this group, send email to coworking@googlegroups.com To unsubscribe from this group, send email to coworking+unsubscr...@googlegroups.com For more options, visit this group at http://groups.google.com/group/coworking?hl=en -~--~~~~--~~--~--~---
[Coworking] Re: Pricing - are we getting something wrong?
It's important to remember that every month you fall below 60 people the expenses still have to be paid. While I own a for-profit that does not make much profit, my city requires that I provide a fully-accessible bathroom. We have hazard insurance, workman's comp, and a payroll service to make sure the taxes are done properly (all are at minimum levels) The chairs and tables wear out and need to be fixed or replaced.We have great internet, but I understand intensive traffic might slow things down and necessitate acquiring an additional IP address. Our portion of a small shared trash dumpster costs almost $100. per month. Lots of our friends and customers work at non-profits, and their costs aren't any less. (Although your rent would be a steal here-ours is mid-range at $12/ sqft/month). A reserve account would make you sleep better at night. I go with the $100.00 minimum and look forward to updates. Best of luck to you all!! On Jun 20, 12:47 am, robdavy wrote: > Hi Everyone, > > Quick question (kinda)... > > We're in the process of setting up a coworking space/hacker space here > in Edmonton, Alberta, Canada (metro pop of 1m). We're well underway, > non-profit registered, directors elected, space found, 40+ members > joined, etc. > > We're obviously working on a non-profit model, shared space, 24/7 > access, etc. > > My concern is pricing. Lots of places seem to offer what we're going > to be offering for many hundreds of dollars a month. We're going to be > doing it for $50. $50/month gets you unlimited access to our 3700sq ft > space. No permanent desks, but permanent offices will be offered for > around $250/month. Our's is not exactly a co-working space in the > sense we do not expect people to work here 9-5 (some will of course, > but most members have full time jobs and want the collaborative use of > the space, plus access to the equipment (machining, etc). Check > outhttp://d.ents.ca/for photos > > Why $50/month? Our rent is $5/sqft + $2.87 operating. 3700sq ft @ $8 = > $2500/month ($'s are per year). So based on the non-profit model found > herehttp://coworking.pbworks.com/PricingExampleswe need $3750/month. > Well, our utils are included in the operating, internet is free from > someones business via a point to point wireless connection, etc, etc, > so we're figuring max $500/month in misc costs. The landlord is also > giving us 2 months free rent. > > So say $3000/month, that's only 60 members @ $50/month each. We have > 40 signed up now (of course some will drop out, but we've still got > many coming in) and we'll cover more costs with offices rented. > > Is it just the cheap rent that is making our space $50/month and not > $300/month (or more!). > Why do some (most) places need to charge so much? > > Thanks in advance > > Rob Davy > Edmonton New Technology Societywww.ents.ca --~--~-~--~~~---~--~~ You received this message because you are subscribed to the Google Groups "Coworking" group. To post to this group, send email to coworking@googlegroups.com To unsubscribe from this group, send email to coworking+unsubscr...@googlegroups.com For more options, visit this group at http://groups.google.com/group/coworking?hl=en -~--~~~~--~~--~--~---
[Coworking] Re: Pricing - are we getting something wrong?
While giving it away so cheaply seems like a great way to get people in the door, it is not sustainable. I suspect your operating costs will be higher in the end if you include insurance, misc. (food, etc.), staff, We operate our coworking space in SF for about $9000. We have set up a professionals model where people can just join the community of entrepreneurs and freelance professionals yearly to attend all of our events for free as well as be part of interest specific groups. Then we have dedicated desks all the way down to 20 hrs./month access. Our 20 hrs is $150/month. We have to sell 60 to cover our costs, so our goal is to have a mix of the part timers with about 10 full timers in the space. Good luck. It's not a one size fits all solution. -Felicity Outside the Cube - For Professionals and Entrepreneurs Cubes&Crayons - For Professionals and Entrepreneurs who need childcare downstairs cubes.typepad.com/sf cubesandcrayons.com On Jun 19, 10:47 pm, robdavy wrote: > Hi Everyone, > > Quick question (kinda)... > > We're in the process of setting up a coworking space/hacker space here > in Edmonton, Alberta, Canada (metro pop of 1m). We're well underway, > non-profit registered, directors elected, space found, 40+ members > joined, etc. > > We're obviously working on a non-profit model, shared space, 24/7 > access, etc. > > My concern is pricing. Lots of places seem to offer what we're going > to be offering for many hundreds of dollars a month. We're going to be > doing it for $50. $50/month gets you unlimited access to our 3700sq ft > space. No permanent desks, but permanent offices will be offered for > around $250/month. Our's is not exactly a co-working space in the > sense we do not expect people to work here 9-5 (some will of course, > but most members have full time jobs and want the collaborative use of > the space, plus access to the equipment (machining, etc). Check > outhttp://d.ents.ca/for photos > > Why $50/month? Our rent is $5/sqft + $2.87 operating. 3700sq ft @ $8 = > $2500/month ($'s are per year). So based on the non-profit model found > herehttp://coworking.pbworks.com/PricingExampleswe need $3750/month. > Well, our utils are included in the operating, internet is free from > someones business via a point to point wireless connection, etc, etc, > so we're figuring max $500/month in misc costs. The landlord is also > giving us 2 months free rent. > > So say $3000/month, that's only 60 members @ $50/month each. We have > 40 signed up now (of course some will drop out, but we've still got > many coming in) and we'll cover more costs with offices rented. > > Is it just the cheap rent that is making our space $50/month and not > $300/month (or more!). > Why do some (most) places need to charge so much? > > Thanks in advance > > Rob Davy > Edmonton New Technology Societywww.ents.ca --~--~-~--~~~---~--~~ You received this message because you are subscribed to the Google Groups "Coworking" group. To post to this group, send email to coworking@googlegroups.com To unsubscribe from this group, send email to coworking+unsubscr...@googlegroups.com For more options, visit this group at http://groups.google.com/group/coworking?hl=en -~--~~~~--~~--~--~---
[Coworking] Re: Pricing - are we getting something wrong?
Hi, - Don't count the free months in your calculations. It's a ramp up time that wont come again next year so count everything as if you were paying the 12 months, which you will do in the future. - At $5/sqft what kind of furniture do you have? Where will the outfitting of the space come from and if you have to pay for it how is it figured in your monthly cost? For example our space was naked and we have been paying 100s of dollars a month to payback the loan we took to pay for outfitting like we wanted it. That adds to our operating costs. - If everyone has unlimited access, how do they get in? Everyone has a key? Or do you count on yourself and/or partners to open the space? Might be a good idea to start thinking how much it would cost if you needed to pay someone. If everyone has keys, are you properly insured? (needed for any setup but, in my opinion, even more if you have that many people able to open the space (or forget to close it properly)) If you are insured, are they aware 60 people will have keys? - Unless the member providing it is one of the founders, I would suggest including internet fees in your operating numbers, even if it's free for now. If that member goes, you might not get the same free deal. - How are you going to do invoicing and have you planned for the time to handle it if needed? It's easy to plan on doing a bunch of things yourself but it might get to be a bit much at some point and planning your numbers to allow for paying someone is a good idea, especially when invoicing 60 people regularly (unless you have a perfectly automated system). - How many tables do you have for those 60 members? What happens if you have 30 tables and 40 people coming in a lot? Who leaves or is turned back? Having 60 members at $50 with potential scheduling conflicts might be more trouble than 30 members at $100... As Tara said, the vast majority of space operators don't make money on their spaces so the difference isn't us making loads of cash. Try to envision all possible combinations and options for your space, we are not making a lot (any?), you are benifitting from rent roughly half what most are paying and using a pretty different model that from the outside and without all the details seems open to some scheduling, invoicing and space entry issues, all of which can affect how much you should charge. We are paying around $12/sqft and will possibly add a $100/125 a month plan which is proportionnaly as cheap as your $50 so it's possible for us too to arrive at numbers in your range. We just don't want to base the whole model on it because of scaling issues and because we feel some more established members are good for the space, hence the Residents. Patrick http://station-c.com --~--~-~--~~~---~--~~ You received this message because you are subscribed to the Google Groups "Coworking" group. To post to this group, send email to coworking@googlegroups.com To unsubscribe from this group, send email to coworking+unsubscr...@googlegroups.com For more options, visit this group at http://groups.google.com/group/coworking?hl=en -~--~~~~--~~--~--~---
