“The definition of shared workspaces has evolved over time with the concept taking a shape of its own. The co-working trend has disrupted the commercial real estate market and is only going to increase manifold.”- Mr Amit Ramani, CEO & Founder, Awfis
The Flexible Workspace Industry in India has been dominated by domestic players which contributed around 68.0% of the total market supply in 2019. Operators are continually evolving their strategies in order to maintain their competitive edge in the industry. In order to understand the dynamic business strategies we reached out to Mr Amit Ramani, CEO & Founder of Awfis, one of the major domestic Coworking brand.
Here are some edited excerpts of the interview:
What lead to the ideation of Awfis? How has the flexible workspace industry changed since then?
Disorganized commercial spaces, no or little transparency and the absence of a conducive environment for employees to work in, led me to start out with this venture in 2015. The industry has come a long way since then and today it is not only solving the traditional workplace problems, but it is imbibing the latest technology and is therefore appealing to millennial and Gen Z entering the workforce. The journey of Awfis growing from 5,800 desks across 20 centers in July 2017 to 35,000 seats across 67 centers in 2019 is a clear testament of our growth. Currently, we have 25,000+ community members and 1500+ companies spread across 9 cities in India.
The flexible workspace market has been growing with a CAGR of around 31% during 2016-2019. What are the major growth drivers in the industry?
Companies are shifting towards more personalised and flexible workspaces from the traditional office set up. India’s thriving economy, growing start up ecosystem, its conducive nature towards networking and enhanced creativity has all lead to the revolution in the flexible workspace industry.
The growing Gen Z population value their work-life balance more than ever. They want a workspace that can help them maintain this balance. Tech enabled co-working spaces provide them with exactly that, accompanied by flexibility and collaboration. These spaces are interactive while being edgy and cool at the same time.
Who are the major end users for flexible workspaces?
In the recent past, the demand from large corporate & SMEs has increased drastically. This is because shared workspace offers them multiple benefits in terms of speed, flexibility and plug & play solutions that allow them to focus on their core business without getting into the stress of managing real estate. Grade A amenities at affordable prices have attracted SMEs, startups and freelancers to co-working spaces. Large enterprises are also opting for co-working spaces to avoid the hassles of long term leasing and managing office spaces, which incurs heavy costs.
Awfis is currently servicing over 25000+ professionals and 1500+ companies across sectors such as IT Services, E-commerce, Electronics, Retail, Automobile, Financial Services, Business Services, Telecom, Consulting, Media, and Technology etc. We are focused at understanding the ever-evolving needs of the Indian consumer so as to incorporate it without losing the essence of the brand.
What has been the company’s Expansion Story?
The expansion journey of Awfis from 5,800 desks across 20 centres in July 2017 to 35,000 seats across 67 centres in 9 cities now is a clear indication of the massive opportunity this space presents & the tremendous growth that Awfis has undertaken. It also is a testament of Awfis’ deep understanding of the micro markets & the Indian CRE business ecosystem.
We will be increasing our presence in already existing Tier 1 markets including Mumbai, Delhi NCR, Bengaluru, Hyderabad, Kolkata, Pune & Chandigarh and our aim is to double our capacity year on year i.e. we expect to reach 2, 00,000 seats by 2022. We have also launched a centre in Chandigarh recently and are looking at expanding into cities such as Kochi, Indore and Ahmedabad in the next 12 months, while simultaneously strengthening our position in tier I cities.
The competition in the industry has been growing drastically. What has been your strategy to maintain the competitive edge in the industry?
At Awfis, we take a different route than any other industry peer. We are more value driven. Also, we have surpassed the usual design sensibilities and created the perfect balance of aesthetics, functionality & minimalism to aid maximum creativity. Our centers are easy to distinguish owing to our focus on bespoke ergonomic furniture, uniquely designed activity-based settings, flexible setup & efficient space planning.
We also accommodate requirements of individual professionals, small teams as well as large companies. Our business model – Managed Aggregation Model (MAM) and product offering – Awfis Enterprise Solution (AES) are the prime examples of that. Under our MA model, we tie up with landlords of underutilized commercial spaces and share the revenue with landowners. Through our Awfis Enterprise Solution, we provide our clients a hassle free way to outsource the tedious task of designing, building and managing of their ‘own’ office space. A number of enterprises have already collaborated with us under this model.
Do you think the demand for flexible workspace will increase in the future?
Coworking is rapidly transforming into a mainstream segment, owing to the evolving role of technology and millennial forming an integral part of the workforce in India. We are witnessing ‘flexibility’ as being an important reason for adoption of coworking spaces. Shared workspaces have proved to be a win-win for organizations as well as employees. The holistic experience of coworking spaces will drive the demand by large enterprises. Also, while metros have witnessed great demand, Tier II cities will grow rapidly with studies suggesting that Tier II markets are estimated to grow to 8.5 million seats by 2020.
What are the upcoming trends in the industry and how do you see the future of the industry in terms of supply?
Shared workspaces will enjoy momentous growth in the coming years with “flexibility” being an important component amongst the other aspects of a workplace. Coworking spaces have proved to be beneficial for both organizations as well as employees. Shared workspaces will rapidly foray into tier II cities, in addition to metros witnessing great demand. Cognizant of the ever-growing Artificial Intelligence & Machine Learning, the significant inclusion of these across co-working spaces will lead in the coming years and deeply support new workforce entering. The segment has tremendous capability both on the demand and supply side equally to cater to the ever-evolving needs of the market.
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Ankur Gupta, Head Marketing & Communications