How Co-living Uses Economy of Scale to Generate Profit | The Tenants' Voice
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(5/5 )How Co-living Uses Economy of Scale to Generate Profit

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last updated: 21 Jun 2017 report a problem

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Let’s discuss a practical example with office spaces. Any decent office building has the following features and benefits from an employee point of view:

  • An office cleaner – these ladies are a blessing
  • Commercial grade internet
  • No charges for utilities, water, etc
  • Shared kitchen and lunch areas fully furnished and equipped
  • Leisure rooms with video games, a big TV and seating areas
  • Conference rooms
  • A gym with sports like table tennis or foosball

Everybody who worked in a good office has had these features and used them at their pleasure. Now here is a good question:

Why does your boss invests tens of thousands of pounds to create these amazing office features and give you positive experiences ?

Because it’s cheaper than raising your salary.

Yes, there are productivity and focus benefits, team buildings and connections and all those things. But, when you have a business you have to choose the most cost-efficient way to get the best returns for the company. In the end, it’s about balancing in and out-going cash.

A good Playstation 4 set costs £400. Throw in a big TV and a surround sound setup and you have an entertainment set for £1500.

That’s enough to give 20 people a bonus of £75 for one month. They can throw a big party and celebrate. This is the best job in the world…right after the headache is gone…

The next day, they are back at work and the £75 is gone and there is no Playstation and no TV. Their job satisfaction is back where it was and you have to dish out another grand and a half to keep them all happy.

If you buy the entertainment set you only pay for it once. The workers can all enjoy it, play games and have fun. They don’t need to buy one for their home, because they can just crash at the office and have a great time.

They don’t need a Playstation, they don’t need a gym subscription, they don’t need to play table tennis elsewhere, which all cost money… They can just do it in their office and they are no less than their mates.

And you save money…And do you know what’s better than saving money ? Making money !

A digital nomad doesn’t need these things in their office, they need it at home.

By building all these amazing features into people’s homes, they don’t need to go to separate places and providers to get these amenities and services. This will also cost more than to get the whole package from one provider.

Instead, they can give you the money and you will provide them with the complete living experience. This is living as a service and this is how you make money.

You provide quality living experience at a scale for less money than it costs as a combination of other services. Overtime your investment pays off and the turnover is much bigger the running costs, so you profit.

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