Two Ways Your Small Business Can Benefit From the Sharing Economy

sharing economy

If this short conversation hasn’t happened already, it will happen soon:

Mary: I like your new dress.

Margaret: Thanks. Want to rent it?

Average people today are empowered to rent the shirt off their backs – or in my example, the dress. They’re calling it the sharing economy, but that’s really a misnomer. Sharing is when you break off half your candy bar and give it away to your friend. This is really grass roots, peer-to-peer renting or trading, for the most part.

An infinite variety of rental connections are possible today because it is so easy to communicate with virtually anyone over the Internet. If Jacques has a garret to rent in Paris, Jack can reserve it from his brownstone in Philadelphia.

The impact of this on small business owners will be huge. Some will find ways to benefit and others will have to modify their business plans to cope with the market changes. Let me give you a few examples of the potential, both positive and negative.

Find what you can ‘share’

You should look around your small business to spot excess capacity. Do you have equipment or even space that isn’t being utilized to its fullest capacity? You might be able to find others who would want to “buy” your excess capacity from you. If your offices are too large, rent out your spare space.

If you have a widget folder that sits idle except for that one big widget order you get from a long-time customer twice a year, find someone who may be able to use it. Or if someone else needs it more than you do, sell it with the agreement that you can rent it back twice a year.

Further, consider some of the popular peer-to-peer options for business travel. Would you like to take the whole team on a retreat? Instead of a hotel, find a nice house through Airbnb or some other vacation rental site. If your reps do business in cities with Zipcar service, you might be able to lower your rental car costs. Of course, Uber and Lyft are also options.

Fewer non-necessity purchases

On the downside of the sharing economy, consumer demand may decrease for some items. When convenient short-term use can be arranged, there will be some things that people no longer need to buy. Have there been occasions when you bought something for a special event or occasion and afterwards it got relegated to the attic, basement or dark corner of a closet? There will be fewer purchases like this going forward.

This impact will increase in the coming decades. Millennials and the generations that follow them will be very accustomed to working the levers of the sharing economy and it will feel natural to them. Baby Boomers are used to accustomed to buying everything they need. They will not drop that habit overnight.

So enjoy the sharing economy. Leverage it as both a consumer and as a supplier. For the small business owner looking for additional incremental income as well as cost-saving measures, it should prove beneficial.

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