CNBC Business | Office Manager

Office Manager

The recession may be forcing companies to ditch city centre office space, but for Mark Dixon of Regus these are good times. Boyd Farrow reports

It might sound a bit reckless when a chief executive of a FTSE 250 company admits that his business will never be the same, even when the global economy picks up. Especially when that company is Regus, the world's largest provider of furnished office space. But Mark Dixon is as confident a self-made multimillionaire as you'll ever meet. And if he didn't exactly enjoy the various financial derailments he has faced over the years, he sounds like he is actually relishing the current market challenges.

"Recessions are like going into battle," says Dixon, looking, somewhat disconcertingly, like a chunky Napoleon in his navy suit as he is PR-marched through a legion of camera fodder at the opening of Regus's flagship "business centre" in Mayfair in June. "In the good times everyone thinks this can just carry on but we all know the saying ‘when the tide goes out'..... Well, I've seen the Asia crisis, SARS, the currency crisis in Argentina, two Brazils, the Russian crisis, 2002 — which was a near-death experience".

"What's happening today," he continues, "is a 100-year thing. We're in the eye of the storm but the same rules apply. It's a time to refresh skills, to be at your most creative and take risks." Indeed, Dixon claims Regus has cooked up more new products in the last year than in the previous 20. "Normally you have a five-year or a three-year plan — now it's 12 months."

The "drop-in" business centre, where individuals can spend a day for less than the price of their bus fare and get free caffeine, newspapers and broadband is one of these microwaved innovations. A new BusinessWorld swipe card, modelled on the Oyster cards used on London transport, buys individual customers access at any of the Regus centres in 450 cities in 75 countries for £199 (€230). An even cheaper corporate version of the card can be bulk-bought by large companies and early adopters include carmaker Nissan and soft drinks company Britvic.

The new Mayfair centre boasts a surprisingly cheerful mixture of office spaces, meeting rooms and even work pods that look like they've been unscrewed from a spaceship. Indeed it is hard not to think that you are commanding the Starship Enterprise in the room kitted out for world-straddling "telepresence" meetings. The room costs £299 (€350) an hour and similar services are available in Regus offices in Singapore, New York and Paris.

Dixon says there is a growing market for business centres like these as companies restructure and outsource. "A lot of companies don't want offices for their sales people," he confides. The numbers work for Regus because enough users pay to hire meeting rooms or "virtual office" services.

"We had no idea so many people were looking for something else than office space," Dixon shrugs, explaining that the "recession-busting" service was simply borne out of the roaring years of 2007/8 and was a way for the company to market suddenly unwanted space. "What surprised us is the number of corporations expressing interest in signing up thousands of their staff at a time. Which is why we believe it is a permanent change and we are a good indicator."

Now Regus is trying to get these business lounges into airports — it already has 12 worldwide including Amsterdam's Schiphol — and places close to airports. In the US the Regus "drop-in offices" are close to white-collar housing developments. In the UK, it is the market towns. "There is your company head office, your home and a third place, which is what we can become," he says. "We're going back to the pre-train era. It's a full circle: people working close to where they live. We can see new, efficient industry appearing out of this. Virtual companies use less fixed staff and people will be pulled together for projects. Our centres can be an alternative to Starbucks for new types of businesses."

Ironically it was during the latte-fuelled dotcom boom that Regus really caught fire, expanding at 90% per year during the 1990s, which led to a London flotation valuing the company at £2bn. But in the ensuing dotcom crash and recession, Regus's US business crashed into Chapter 11 bankruptcy protection. Dixon was forced to sell a majority stake in the company's British operations to private equity group Alchemy Partners.

This time around, instead, Regus' downsizing office solutions are boosting revenues, although the collapse of sterling has also helped by inflating overseas earnings. Sales in the four months ending 30 April, rose 16%, to £387m (€450m), as firms looked to cut property costs. During that period, Regus added 1,485 business units, making a total of 160,606. Sixteen new locations were also added to the international portfolio, including an 18th facility in Manhattan.

Like many entrepreneurs, Dixon has a colourful backstory. He left school at 16 and in 1976 set up Dial-a-Snack to make sandwiches, which he delivered on a bike. After spells working abroad, including a stint in an Australian iron ore mine, he bought a burger van. When he had trouble with the supply of buns, he set up a bakery. In 1988 he sold the Bread Roll Company for £800,000, moved to Brussels and a year later set up Regus. He says he is unimpressed when every profile of him starts by referring to him as a former burger seller. "There is still the Tall Poppy Syndrome in the UK," he snorts. Now Dixon divides his time between Britain and his French vineyard Château de Berne, one of the biggest producers of rosé wine in Côte de Provence, where his neighbours include Johnny Depp.

While you suspect he is not someone easily seduced by glamour, Dixon says he has learned a lot from many people, adding "there is no monopoly on good ideas". He says he cannot select a guru but admires Carlos Ghosn, the CEO of Renault and saviour of Nissan, for "shaking things up".

He says that the overriding lessons he has learned are to "question absolutely everything" and have great people working around him. "You have to keep reassessing what you're doing and why you're doing it. And in difficult times you must act quickly and make sure everyone in your business is facing the right direction. A major part of my job is going around and listening. A lot of ideas have come from our customers and our people. That translates to the way we run the company. The job of an entrepreneur is to reinvent what is out there."