Coworking spaces provide a professional work environment along with plenty of facilities. But for most of the users, cost is one of the major factor in selecting a space. Various coworking spaces have a variety of membership plans according to what facilities they have to offer and their users’ needs. When deciding the price package many things go into consideration such as the current price trends, competitiveness in the market and the needs of the members to name a few.
Coworking is a growing industry and an operator’s profitability margin is essential to all players. Although still new, it is a rising sub-sector of the real estate and thus attracts competition. According to Forbes, there are over 7,000 coworking players in the market. This mushrooming market thus calls a need to keep up profits to stay afloat.
If you are a coworking space thinking to increase membership price but not sure the best way to go about it then worry not, Team Kowrk is here to help. Below are 4 things to be taken into consideration before doing so-
Avoid increasing prices very often:
Increasing profits is essential for coworking spaces but it has to be done strategically. It has been observed that many coworking spaces increase the prices of their membership plans once they are opened for at least 2 years and later with a gap of 3-4 years. One of the aspects of coworking spaces that attracts its users is the affordability and stability. Increasing prices very often might lead to a gradual loss of members.
Do it first for the new members:
Founding members are the primary experienced users who get any coworking space more members. Therefore, once you have decided to increase the prices of your membership plans, apply them to the new members. This will show you how your users are reacting to the price change without affecting your existing members.
In any business, transparency between the customers and service providers is utmost and goes a long way. When deciding on making changes in the pricing model of your membership plans, reasons for doing so should be given to the members so they have an idea of why you chose to increase the prices. This increases cooperation among you and the members. Also, it is advisable to inform your current members in advance about the changes.
Offer additional perks:
With the increasing rates in the plans, you can offer your members additional perks with it. This can include recreational furniture like recliners or hammocks, discounted gym membership, networking workshops, additional quiet zones etc. So when you increase your prices and offer a few additional perks, the users get assured that it is beneficial for them too.
Redefining the pricing model to keep up with the market is essential for any business. Do it in a smarter way without burning a hole in your users and your pocket and making it a win-win situation for both. So think of the above mentioned areas and you will be able to keep up with the competition in the market and also your users happy!
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