When you are starting a business, have you ever thought to open your first office in cities like Surabaya, Penang, or Davao? In most cases, people opt to not choose those locations because they are what is referred to as secondary cities, or tier-2 cities. If the budget allows it, most enterprises would like to headquarter in the capital cities, such as Jakarta, Manila, Kuala Lumpur, or Singapore because of its abundance of resources. However, coworking spaces are predicted to change said mindset by not only providing enterprise solutions, but actually transforming those secondary cities, and here is why.
The Perfect ‘Test’ City
With the obvious lower cost of these cities, new businesses can test out the performance of their products before cashing out on large budget in the capital. Surabaya in Indonesia, for example, has a market condition mimicking Jakarta’s in a smaller and slightly less competitive version. Although they are not the largest cities, those second tier cities can help determine whether a new product would perform well on the market.
Improving Startup Culture
Having a large number of startups, especially in a smaller city, would highly benefit the location. For starters, it would nurture the economy of the region because of the traffic generated from the business. It opens job opportunities which therefore reduce the unemployment rate, which considering the population size in some of these countries would be a blessing. With the presence of more and more coworking spaces, small startups can easily access a working space that is both cheap and flexible.
Inviting More Digital Nomads
Since our beautiful region of Southeast Asia is known for its culture and scenery (not to mention relatively cheap living costs), more coworking spaces means more digital nomads. These are people working whilst travelling by having online businesses, doing online chores or other means. Aside from the obvious tourism benefits, this would mean an increase in exposure of local businesses, spending power, variety of interests, and other plus points for driving these developing countries towards globalization.
Read also: How to Stay Productive as a Digital Nomad
Creating Urban Growth
With more and more coworking spaces opening everyday, infrastructure is getting better and better everyday as well, creating new urban areas. More old buildings are being refurbished and renovated. More streets and roads are being built and renewed. This would turn a mere secondary city to a secondary metropolitan region, where it is the next destination for new and/or foreign companies to establish their businesses. True, that this city might not house global bank brand headquarters, but coworking spaces would be the perfect option to create venues for their branch offices.
Increasing Credibility of Current Businesses
The current businesses that are already up and running would also benefit from these coworking spaces. The simplest example would be the usage of virtual office services. With secondary cities filled with brand new coworking spaces, the surrounding area which would have even less resources due to their location could now have a more prestigious and easily accessible business address. This new metropolitan area address would nurture their supply chains, increase and create exposure, and most importantly increase their credibility.
All in all, coworking spaces have affected these cities for the better, and this post is an invitation for us to be more aware of them. If you are a space operator, be it local or international, think about including secondary cities in your next build. If you are an entrepreneur looking for a new location to expand your enterprise, do it here, or even test out new products here. After all, secondary doesn’t mean bad: they just need a little more love.
If you are looking for a coworking space or any workspace in these cities for that matter, do not hesitate to reach out to us and our Space Experts will help you in a heartbeat!