Take Advantage of Opportunities in the Sharing Economy

We have all heard of successful start ups which thrive in today’s sharing economy. Prominent examples include Uber in the area of shared personal transportation and Airbnb in shared lodging.

Success in the shared economy largely hinges on the concept of reducing the high cost of ownership to a much lower usage cost. Why pay for the entire cost of purchasing a capital asset when your usage requirements are not that frequent. The saving that you can obtain can be considerable as a consumer. You don’t have to stop at automobiles, bicycles, lodging, wedding gowns and tuxedos. There are many other products or services available on a shared basis.

However this article is not about savings for your consumer needs. Its about opportunities in the sharing economy for start ups. There are 2 possible angles here.

The first is the cost saving opportunities that start ups can take advantage of. Instead of paying for capital assets or the salaries of  skilled employees, start ups can make use of the shared economy to reduce their initial costs. As an alternative to hosting your website or blog with your own server, you can use a web host on a cloud. The same applies for your financial accounts in which you can easily outsource. If you require to employ certain numbers of people, there are human resource providers which can service your start up. When you need to deliver goods, you can easily use a shipping or courier company. Even the space you need for your business can be shared communal space specially for start ups. Also there are shared retail spaces for those who only need a small area to display the limited range of goods that they sell. These places also come with cashiers who can collect monies on your behalf.

You can also use the internet to get someone to design a logo for your new company for a low fee. If you need someone to develop the app that you thought of, you can get someone online to do it for you at a competitive fee. In other words, almost everything can be outsourced in today’s shared economy. The important thing to note is that you save on the high capital costs as well as high salaries for skilled employees. This releases much needed capital that you need to fund your start up.

The second angle to look at the shared economy is the opportunities for start ups to be a provider in this area. Earlier, it was mentioned that almost everything can be outsourced in today’s shared economy. Well, not quite. There are still many areas in which there are gaps. Serving the consumer in the shared economy is somewhat crowded. For a change, how about catering to businesses and companies?

There are many mom and pop shops around the country which run their businesses the same way that they did over the last half century.  Offer them something they need to improve but package it so that they do not have to incur a high capital cost. Isn’t that the concept of a shared economy?

Many businesses and companies have a need for extra space or have the extra space available for short term use. However it is generally difficult to market space for short term use. Thus there are opportunities for a Airbnb version for such space for short term use for commercial, industrial or warehousing facilities.

Manufacturers sometimes have machines which are underutilised given the whims and fancies of business needs. These idle machines could be needed by other manufacturers if only they are aware of its availability. Herein lies an opportunity for a start up to match those with the need with those who have the machines  available.

These examples are not intended to be exhaustive but more as an eye opener for would be entrepreneurs to be aware of such opportunities.

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