“What’s mine is yours, and what is yours is mine”. Those are the famous words of Vincentio in Shakespeare’s Measure for Measure. Like so many Shakespearean quotes, it has become part of our modern lexicon and is more relevant now than ever before. Over the last few years, we have witnessed the rise of something dubbed the “shared economy” or “sharing economy”. It emphasises collaboration and teamwork and companies are utilising it to improve organisation, development, and many other facets of their business.

So, what is the shared economy business model, how can you utilise it, and can the sharing economy improve your bottom line?

What is a shared economy?

Why own when you can rent, and why leave something unused when someone else will pay for it? That’s the basis of the shared economy, and it’s one that provides the foundation for companies like Airbnb. But it’s not just about vacation homes. It encompasses everything from clothes and cars to ideas and time, and it’s a concept found in many modern businesses.

As an individual, you can participate in the sharing economy by renting your personal assets. Maybe you have designer clothes you’re not wearing or instruments you’re not playing, for instance.

As a business, you can combine multiple workspaces, rent parking spaces/office spaces, and ensure that every asset—and thus every minute and every cent—is utilised to its full potential:

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• A peer-to-peer network built around the sharing of assets
• Assets include both goods and services
• Typically conducted online
• Also known as the “sharing economy”, as well as “collaborative consumption” and “peer economy”
• Allows companies to bring multiple ideas, spaces, and workstations together

Shared Economy Examples

Some of the biggest tech companies use the sharing economy as the basis for their success. We've already highlighted Airbnb, but the entire crowdfunding sector is also a prime example. Consumers can donate money to creatives or Some of the biggest tech companies use the shared economy as a basis for their success. We’ve already highlighted Airbnb, but the entire crowdfunding sector is also a prime example. Consumers can give money to creators or charities in exchange for perks, products, and other rewards.

Other shared economy examples include:

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• Clothing Rental
• Coworking Spaces
• Couch Surfing and Office/Room Rental
• Ridesharing
• Task Sharing Marketplaces

Which industries benefit the most from the sharing economy?

Both business-to-consumer and business-to-business brands can benefit from the sharing economy. Typically, it will benefit companies more if they tick one or more of the following boxes:

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• They are capital intensive - if they are an asset-heavy business, they could free up some vital resources.
• They are geographically concentrated - most of their operations are in a single area, making it easier to lease them.
• They experience underutilisation - such as unoccupied parking spaces and office. And this is where desk sharing comes into play.

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The desk sharing concept is based on the shared use of resources, which in the case of desk sharing means that workplaces are flexibly divided among several users. This results in more efficient use of office space, which allows companies to save costs and make optimal use of their resources. Desk sharing also promotes networking and collaboration among employees by creating flexible working environments and thus improving internal communication and the exchange of information. Because desk sharing software, such as Flexopus, making it easier to access and manage these shared workplaces, it is becoming an indispensable tool in the modern, flexible working world driven by the principles of the shared economy.

Pros of the shared economy business model

The shared economy provides some clear benefits for companies across an array of sectors:

Improved capital efficiency

Assets aren’t underused, and this helps to reduce costs and eliminate unnecessary expenses. Maximising the cost efficiency of existing projects could also lead to fewer investments in new and costly projects.

Reduced emissions and waste

Modern businesses are increasingly aware of their carbon footprints. They have a moral and regulatory obligation to reduce their emissions, and the sharing economy could help with this. If a large building is only half used, for instance, those additional spaces could be rented, thus providing other workers with the space they need and reducing the need for them to travel or find alternative options.

Better ideas

The collaborative nature of the sharing economy fosters a creative community and helps companies find new ideas and promote promising talent. It is less rigid, and flexibility promotes creativity.

Disadvantages of the shared economy business model

For all of the benefits of this promising business model, there are some downsides. These typically stem from the uncertainty around the sharing economy, which in turn is down to its relatively recent introduction:

Regulatory uncertainty

Many of the services provided by collaborative platforms focus on established industries built off the back of strict regulatory practices, and these practices are hard to maintain at such a grand scale. In other words, it’s easier to regulate a large hotel chain and ensure it meets the highest standards with regard to fire and food safety than it is with someone renting out their basement or spare room on Airbnb.

Bias

A hotel chain can’t discriminate or it will find itself staring down the barrel of an expensive lawsuit. But if you allow homeowners to rent out their spare rooms and scrutinise all visitors, they’re more likely to be biased against certain races, cultures, religions, ages, or genders.

Summary

The sharing economy has been a game-changer for consumers and companies alike. It has changed the way that we work, travel, shop, and create, and it continues to play a major role in the introduction and growth of novel businesses. What’s more, thanks to Flexopus, it has never been easier for companies to join the sharing economy and start reaping some of its many benefits.