Sharing economy values are encouraging a new breed of business
On the 16thJune, this year’s annual Global Sharing Week will celebrate the expansion of the sharing economy, bringing together a range of internationally hosted events to show how sharing will continue to transform the world. The sharing economy represents a new approach to business which matches supply with demand in collaborative, creative, community-focused ventures. Here, we look at seven sharing economy companies and their innovative solutions to avoid waste and maximise resources.
1) LENA the fashion library
The fashion industry has faced fierce criticism over its high resource expenditure and unsustainable business models. In fast fashion, trends come and go, and designs are often sold, worn and then discarded in a wasteful cycle. But what if clothes could be recycled between the fashion conscious instead of simply thrown away?
LENA the fashion library was founded in 2013 by a Dutch team who each came from a background in the fashion industry. The startup aims to tackle conspicuous consumption by offering a rental service for clothing and accessories. Users can borrow items from the company’s website and flagship store in Amsterdam on a one-off or subscription basis. The subscription price depends on how much the user wants to borrow. LENA’s range includes items from up and coming designers, sustainable labels and vintage outlets. Customers can also simply buy an item outright. While users are expected to take care of and clean the items they borrow, LENA provides a laundry service. If an item is ruined, the user is charged the full purchase price.
Also based in Amsterdam, Peerby is a peer to peer, multiplatform lending site for household items and appliances. Peerby claims that 80 per cent of the things that consumers buy are only used once a month. The company, founded in 2011, removes the need to buy items by sourcing them from a network of peers. Some items are not worth the one off spend – for example, a six berth tent for an impromptu family camping trip. Through Peerby, newby campers can find out how many six berth tents are available in the local area, how much they cost to rent, and where to pick them up. Once used, the tent is returned and can be borrowed again.
As more people share more things, Peerby envisions a world where less has to be produced. As an upshot of this, resource and energy use will be lower, and so will the emissions created during the production process.
According to the Waste and Resources Action Programme (WRAP), the average UK household throws away £700 of food a year. Across the globe, a third of all food produced goes to waste. Financial losses aside, this has led to a serious human cost. In 2016, the UN Food and Agriculture Agency found that over 10 per cent of the global population were suffering from chronic undernourishment. If the mountain of food waste can be reduced, so too can the number of people affected by hunger.
OLIO was founded in London in 2015 with a view to achieving this goal, one portion at a time. An individual or a business can share surplus or unwanted food items via OLIO’s app, where it can be claimed by other OLIO users. The company has now become a lifeline for those struggling to feed themselves and their families. To date, OLIO has facilitated the sharing of over 1,500,000 portions of food across 49 countries.
Based in Mumbai, peer to peer renting platform Mutterfly focuses on the finer things in life. From high end cameras to luxury yachts, users can access products that might not initially chime with sharing economy values, but which are still in demand. Nonetheless, the business taps into the value of premium items and currently has over 70,000 users in Mumbai alone. As with essentially all sharing economy companies, reputation is everything. The more that lenders lend, the more they earn, thus creating profit by extending product life cycles.
Mutterfly also provides its own ‘experiences’, which bundle together borrowable items. The movie night experience, for example, includes a projector, screen, speakers, and beanbags. It even comes with popcorn, which presumably Mutterfly doesn’t expect to get back.
Streetbank was launched in 2010 to connect people with items, equipment, and skills with those in need of them. The company, which now has 60,000 global members, encourages community development by sharing out resources which would otherwise be costly and difficult to find. Rather than going to a DIY store or contacting a professional, users are able to source what they need from their local areas. At the same time, they build closer ties with the people who live in their neighbourhoods. The sharing economy isn’t simply about saving resources, but also about the creation of mutually beneficial connections.
Parking in a city can be incredibly stressful, expensive, and time consuming. Navigating crowded multi storey car parks and then paying a fortune for a matter of hours is the bane of urban drivers. However, Barcelona based wesmartPark wants to remove the stress of city parking by matching private, empty spaces with drivers. Vehicles can be parked for short or long term periods at half the cost of standard city parking prices. Not only does this save money and create value, but it eases congestion in car parks, making life easier for other road users too. wesmartPark is now available in seven global cities, with plans to launch in Bogota and Mexico.
Airbnb represents the ultimate sharing economy success story. Set up by two roommates who couldn’t afford their rent, the company started off as a rough and ready B&B in the founders’ Californian apartment. At first, guests were invited to sleep on an air mattress on the apartment floor. Today, there are 2.9 million global Airbnb hosts who provide the space for around 800 thousand stays every single night.
The popularity of Airbnb has forced hoteliers to drive down prices, and recognise that accommodation preferences are changing. When given a recommendation-based platform with specific guarantees, people are more willing (and able) to share.
A global movement
At a time of deep concern over resource expenditure and sustainable business development, sharing economy companies stand in good stead to succeed. Through their community based nature, they are keenly focused on consumers and their changing needs. Even in cases where the goods and skills shared could be described as ‘premium’, it’s the mindset that matters.
Whether you own a helicopter, a parking spot, or a sack of potatoes, the beauty of the sharing economy lies in generating value from items which, when viewed through the lens of conspicuous consumption, are worthless. In the sharing economy, everything has worth. While big corporations might struggle with this concept, it’s one they simply can’t ignore.
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