Virtual Address vs Physical Address

An address makes an important part of a company profile. People have more trust and loyalty toward businesses with the real street numbers. When setting up a company, many entrepreneurs face the dilemma of choosing a business address. While a physical home or office address is a traditional choice, it’s not always the best option, especially when it comes to smaller ventures. Renting an office incurs added expenses that are quite high and using a home address puts personal privacy at stake since it appears on public records. In a modern business environment, though, where more and more entrepreneurs tend to run their commercial activities from home, there is a number of business address alternatives to explore. Thus, a virtual address option rapidly gains popularity among all types of entities. How does a virtual address compare to a physical address? What is the difference between them? And which is a better choice for your enterprise? Read our article to find out.

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Virtual and Physical Address Meanings

Today, you can run a business from anywhere, and having a brick-and-mortar office is not that important anymore. Yet, it’s still important to have a physical address related to your company to create a solid and reliable image on the market. This is where a virtual address usually comes in. However, before we delve into a side-by-side comparison, let’s consider the virtual and physical address definitions to have a clear understanding of what they mean.

What Is a Physical Address?

In fact, the term is self-explanatory. A physical address is where your company is located. It’s your home if you run a home-based venture or a rented premise, block, or a whole floor in an executive center if you stick to a traditional office concept. Actually, any brick-and-mortar building you use for your enterprise administration or offline activities could serve as a physical address. What’s important, it’s always a location with a street and building number.

What Is a Virtual Address?

First off, referring a virtual address to an online office is a regular mistake. This type has nothing to do with an online workspace shared by multiple coworkers. Actually, it’s not an office in common sense. Broadly, it’s a web-based platform that establishes a digitalized connection between a real mailing address and online tools that enable you to manage and control your correspondence remotely. Technically, though, an abstract address is yet another type of a real one legally verified to accept mail on your behalf. Relating to a real street and building number, it can function both as a company’s business and as a legal address, i.e. you can use it for company registration to keep your home address private. More than that, LLCs and corporations can use this type for a registered agent.

Meanwhile, you don’t have to be present under a fictitious address to receive your mail in person. Instead, you can manage it remotely via an online mailbox assigned to it. You can choose to take a look at scanned copies of documents or forward your mail to another physical location. The best thing is that similar to any registered home or office address, a virtual one is suitable for package deliveries while ensuring a higher protection and security level to your parcels.

To add more, mailing service providers usually come with added features such as administrative support and meeting space. So, if you ever need a secretary or duly furnished office space to meet with your clients or partners, you can have it all with a virtual address.

Why Do I Need a Physical and Virtual Address?

Still having real locations behind them, physical and virtual addresses serve different business situations and scenarios, and there are different reasons why you might want to choose one type over the other.

Reasons to Get a Physical Address:

Need for Dedicated Space: If you plan to open an offline shop, store, boutique, cafe, restaurant, SPA salon, beauty center, or get engaged in any other type of commercial activity that calls for physical presence in some dedicated space, leasing some sort of premise is an obvious decision;
Creating Professional Company Image: Despite the fact that modern businesses tend to shift online and many smaller ventures are operated from home, entities that have brick-and-mortar offices people can visit look more respectable to customers than those having only a virtual presence;
Building Business Credibility and Gaining Customer Trust: Entities with street addresses feel more credible and reliable to customers while PO boxes look a bit suspicious. So, a real contact address will help get more trust from potential clients and build a stronger market reputation, especially when you launch some new business line;
A Place to Meet With Consumers: If your work and activity imply a lot of face-to-face interaction with customers, constantly meeting them in hotel lobbies and coffee shops might create a wrong impression and put your professionalism at stake. Having a permanent place of business operation with a professional environment will help build more trustworthy customers relations.

Reasons to Sign for a Virtual Address:

Privacy Protection: If you have an unincorporated entity and are not eager to make your home location publicly available, you can use a virtual mailing spot for company purposes and keep your home address private;
Operation Flexibility: You’ll consistently get your mail in a single location and won’t miss any important letters or deliveries, no matter where you are. It’s a good choice if you relocate your business from time to time;
A Permanent Location is Not Your Cup of Tea: Running a home-based venture or providing online services and holding your meetings via Zoom, Skype, or Google tools, you simply don’t need a rented office. However, a virtual address with a street number will still contribute to your company’s profile;
Need for a Reliable and Safe Mailing Address: If your work implies a lot of trips or even city commutes and you can’t regularly stay at home or in the office during business hours, a virtual address will make sure all your mail pieces and packages will be received and duly handled.

Difference Between Virtual and Physical Addresses

The core difference between them is that a physical location is where the enterprise or company is situated in real life on a daily basis, and a virtual address is rather used for mailing purposes and doesn’t require your permanent presence there. While both have a street number, a physical address is usually a certain place where your home or office is. A virtual one, on the other hand, is just an approved eligible address assigned to your company to receive mail. Virtual addresses are normally related to spaces, blocks, or premises in commercial buildings or executive centers that are conveniently located in central parts of the city. To level up your company’s image, you can even choose a prestigious address in some premium executive office.

Notably, a fictitious address is always a mailing one since this is its initial purpose. In the meantime, a physical location is not necessarily a mailing address. For example, you might want to separate your personal and company mail or you have several offline shops in various locations and seek to get all business correspondence under a single mailing address.

For mailing purposes, many small-scale ventures use PO boxes. Yet, a PO box has no street number assigned to it. Hence, unlike a virtual one, it can’t be used as a legal company address and is not suitable for registering a company or receiving formal and legal correspondence.

To sum it up, a virtual address has many functions of a physical one, as well as its own benefits. Thus, you’ll get a verified street and building number you can use for business at a much lower cost than that of a rented premise. At the same time, you’ll protect your private address from being displayed to the public and create a stronger business image supported by a real address. As such, it’s a perfect alternative to online companies and home-based businesses to duly manage their mail and get a more professional appearance. However, for bigger companies hiring multiple employees and for the brands seeking to fortify their market positions, it’s still important to have not only a valid physical address but also a physical presence. It’s crucial for setting up appropriate internal relations to achieve company goals and improving customer relations via face-to-face contact.

Can I use a virtual address for my business?

You can safely use it for business purposes since “virtual” here rather refers to “other than your actual company address” than “relating to digital space”. In other words, it’s still a real address suitable for receiving all types of correspondence and deliveries, serving as a physical one for a registered agent, and even fit for legally registering an entity.

Is a virtual business address worth it?

This type of mailing address has a lot going for it. First and foremost, it offers a physical location to enterprises that don’t need a real office while saving the need for business owners to disclose their home addresses to the general public. For a bigger venture, virtual addresses offer an opportunity to expand to other states and locations without opening physical representative offices there. Since it can accept both mail and voluminous packages or parcels, you can use it for product shipments and returns across the country.

Does a business need a physical address?

It will contribute to an overall company image and respectable reputation on the market. However, if you don’t seek a physical presence, you can get an eligible street number for your organization by signing up for a virtual address.

Is a business address the same as a physical address?

If you have an office or don’t mind using your home address for business purposes, you can use it as a company one. Otherwise, you can use a different location by renting a virtual mailing address.

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