It’s hardly breaking news that in the UK and around the world, home ownership is losing ground to the rental market. Meanwhile, internet-based services and peer-to-peer rental services, where people sell directly to peers on eBay, rent out rooms in their homes with Airbnb or drive people in their cars with Uber have enabled the rise of the sharing economy.
It’s a new way of consuming that’s being built by web startups that either rent items or serve as middlemen, connecting people who want something with the people who own it. It’s no coincidence that many of these companies emerged during the financial crisis. It may well herald a cultural shift away from the over consumption that has driven so much of capitalist culture. The sharing economy is part of a growing, post-recession movement to stimulate innovation and growth.
There are now more than fifty sharing organisations in the UK, the highest number in Europe. It reflects in part the efforts being made by the UK to stimulate growth in the sharing economy, which includes a budgetary policy conducive to sharing economy business models. The UK’s March 2016 Budget introduced two £1,000 tax-free allowances for property and trading income for any sole trader, a measure that was billed as the “world’s first sharing economy tax break” by the business sector.
So what does this mean for business? Well, the sharing economy, or collaborative consumption, offers opportunities for businesses—particularly small and medium sized businesses—to benefit from a range of resources they might otherwise struggle to afford. Here are a few ways to benefit:
Transport and delivery
No, we’re not talking Boris Bikes—rather, it’s about sharing resources. The team at AnyVan have tuned in: “Our main team of white van men frequently have empty space in their vehicles as they go about their existing routes. By adding your item to their part-delivery, this benefits both you and the driver.” The service they offer—delivery, removals and couriering of goods—is therefore both economically and environmentally sustainable for both parties involved.
Unlike in-house services, businesses transporting goods in the sharing economy don’t actually own the vans whose space they rent out, so they don’t have to spend money on licences and safety inspections. Drivers are more like freelancers than employees, meaning their services can be utilised economically, only as and when needed.
Fast food suppliers and restaurants benefit from a similar opportunity: partnering with food delivery couriers like Deliveroo. The principle, though arguably in need of reform, is a useful solution for many small businesses who would otherwise struggle to match the necessary resources to grow their business. Sites like JustEat and Hungry House act as middle men who’ll market your business too.
Co-working spaces and serviced offices
If the benefits of the sharing economy cover fees and licensing, that applies equally to office space too. Research by Deloitte shows that the serviced office market in London has expanded by 67% over the past decade.
Serviced office operators like i2 Office and Regus generally offer fully-equipped and furnished space, with all occupancy and business costs bundled and fixed, together with a full maintenance service. Businesses don’t own or directly rent the space, but can customise their package to suit their needs. And then there are co-working spaces like We Work, who offer collaborative workspaces for people who want to drop in, reserve a desk or rent a private office.
The real financial benefit for businesses in co-working and serviced offices comes with optimising for efficiency. The costs of a serviced office vary depending on the square footage of the space or by how many desks your business requires.
Professional services on demand
Freelancer marketplaces are enabling businesses to access on-demand support in skills such as administration, consultancy, even out-of-house accountancy for contractors and freelancers from chartered specialists like 3 Wise Bears. For small and medium sized businesses who don’t require full time financial and accounting professionals, it’s an invaluable opportunity to outsource.
TaskRabbit is a popular online marketplace to source people to fulfil a range of jobs and tasks, from handymen to office help. It’s similar to Craigslist and, generally, the web fosters trust. As well as the background checks carried out by platform owners, online reviews and ratings are usually posted by both parties to each transaction. Using Facebook and other social networks, participants can build a picture of exactly who and what they’re getting.
Services on demand also include equipment and technical resources. With borroclub, businesses and members of the public are invited to try-before-you-buy, borrow tools for a one-off job and save money on buying new. If you’re trying out something new or testing expansion, it’s a sure fire way to save risking the cash.
In many ways, sharing is something we’ve always done: you scratch my back, I’ll scratch yours. But now, with the true advent of the sharing economy in the digital age, it might just be the perfect way to foster the growth of your new business.