Introduction to the Sharing Economy
There are certain organizations that are starting their business or are looking to expand their business and therefore requires financial assistance in order to get their work and business going. The sharing economy is a term that has extensive degree of meanings, which is generally used in order to explain the economic operations that are associated to online transactions. The term is used in the modern time period in order to explain any sales transactions that are undertaken through the online process (Hamari, Sjöklint and Ukkonen 2016). The organizations that are going ahead with the idea of sharing economy are no longer the new to the economy. The consequences of sharing economy out of which a part of it is referred to the “gig economy” have been argued extensively in the news and social media and the world of research has been weighing steadily with an-in-depth assessments. One of the key aspects has been whether the sharing economy is only incorporating more opportunities related to the wage earnings to more individuals or whether their net impacts is the displacement of the conventionally secured jobs and establishment of a land or an area that has part-time and works that are low paid (Lewandowski 2016). There has an argument that sustains to be developing and playing out, with the help of which it compels the reporters to understand and compare the challenging claims that differs in tone from the development and the warnings of the darker side of the new economy.
The sharing economy will unavoidably become the significant section of the global economy. This report would therefore look to assess the present scenario of the sharing economy and the examine the fundamental social, economic, political and technological factors that leads to the development of the sharing economy and estimating the development of this area in the future years (Kolk 2016). The unexpected development of sharing economy has incorporated various unexpected issues for the consumers, obligatory businesses, policy makers and regulators. The paper would look to recognise the issues and provide suggestions on how the platforms of the sharing economy can be explained and used.
1 (a).The sharing economy is commonly explained as the peer-to-peer dependent operations of giving, gaining or even sharing the entrance to the services and goods, which is synchronized with the help of the online services that are community based. There have been several surveys that have been undertaken and the results have indicated that this sector has the most extensive penetration as the results have shown that consumers make use of these services extensively (Cheng 2016). The consumers have increased the use of these online based services and the consumers mainly use the conventional sharing economy products like the sharing of rides in Uber and room sharing in Airbnb.
In the meantime, the hiring of labour and product renting for a shorter time period has been at the bottom of the table. These lower level of percentages recommend that that very less amount of service and goods sharing takes place among the peers. Most of the renting activities takes place from an organization that has their own assets. In this aspect, true sharing consists mostly of the sharing services of rooms and rides (Barnes and Mattsson 2016).
The Present Scenario and its Factors
The sharing economy has been looked upon to be big and developing rapidly. Pricewaterhouse Coopers predicted that the revenue of sharing economy would be rising to $335 billion by the year 2025 from a meagre revenue amount of $15 billion in the year 2014 (Collaboratecorp.com 2018). The sharing economy is dependent on the digital platforms that assists the individuals who do not know each other to make use of the assets that are underutilised. These ventures are referred to as the peer to peer technologies. On the other hand, the current estimates are inclusive of two different frameworks of business. In certain cases certain individuals own and even share the assets like the additional music files, household tools rooms etc. The sharing economy is assisted by crowdfunding. In the process of crowdfunding, there are lots of individuals who are interested in investing in the idea rather than only a single person who is coming up for the purpose of investment. In the process of crowdfunding, every individuals invests a little in order to attain the actual goals. Crowdfunding platform is utilised in order to control and administer the collections and provide a core location in order to distribute the idea and the information that one looks to attain. After one has attained their goal, the project can be initiated (Wirtz et al. 2016). It is essential to keep in mind that these platforms are no existent in order to take away their services.
For instances, the countries like India, there are key push in order to bring in digitalisation from the government from each and every level. The priority of the policy has led to key development in the scale and the aspect of the digital businesses (Gërguri?Rashiti et al. 2017). There are new start-ups that are being registered in the economy of India who are offering extensive services and products by making use of the digital platforms. This policy has been found to be extensively beneficial to the sharing economy.
1 (b).There are certain benefits and limitations that are existent for sharing economy are explained as follows:
Benefits
- This process is a form of economy that looks to reuse, recycle and repurpose
- It reduces the number of unemployed personnel and offers a platform for the sellers.
- It provides citizens and the powers the citizens and thereby makes them more productive
- It leads to the creation of the new and innovative ideas for the business.
Limitations
- It is not fair for the individuals who earn with the help of this process and eliminates the profit from the company
- It leads to a loss in the revenue for the government
- It can become a source of scams and frauds
- It is actually an innovative process of capitalism
2 (a).In this paper, Kickstarter platform has been used as the crowdfunding process can be initiated with the help of Kickstarter and this process is geared for a project that is creative (Tukker 2015). In this process the funding process is taken by selecting a group of individuals who are ready to pay in this project.
2 (b).The request that has been made is to start a new and innovative business or project like writing a book or creating a new album and accordingly it has been observed that this request is aligned to sharing economy because of the fact that these projects are associated to the digital platforms and accordingly the businesses would be based on the digital platform.
2 (c).This request is likely to succeed because of the fact that these projects are based on the digital platforms and therefore crowdfunding and the funding request in accordance to sharing economy will be accepted.
2 (d) .This concerned project will contribute to the sharing economy in a meaningful manner as it is seen that crowdfunding is undertaken with the help of various investors and the funding in the business related to digital and therefore this project is contributing to the sharing economy.
Benefits and Limitations
3.In my own meaning, share economy is a developing economy and has extensive scope of development. With the introduction of digitalisation all over the globe, I have seen that shared economy has gained prominence and therefore this arena would enhance the economy and the society as well. I feel shared economy can improve the lifestyle of individuals and accordingly there would be an upgradation of the technologies. I feel that the company that makes use of shared economy would be helpful in enhancing the profit for the business and accordingly, I believe that the economy can benefit extensively. Hence, I can strongly say that the sharing economy can be beneficial for the society and the organizations and is a path for further development in the future.
4.The world has seen an extensive development and penetration of the sharing economy that is assisted by the developing digital platform and the eagerness of the customers to make use of the mobile applications that would assist in peer-to-peer business frameworks, shared owned enterprises etc (Zhang et al. 2015). These platforms are bigger organizations but attain the resources from a crowd that is distributed with the digital spaces on the development (Puschmann and Alt 2016). The sharing economies permits the individuals and the associated groups to generate money from the underutilised assets. The current time period is going towards an economy where the physical assets are shared as a service. The individuals have revealed a vigorous hunger for all extents of the services that have been provided by the sharing economy in various industries and even from the consumer and retail goods (Charman et al. 2017). In the coming future, the crowd reliant capitalism framework is anticipated to enter in various sectors. Even though the healthcare sector is slow-moving conventionally in responding to the digital developments, various digital platforms that offers low end and non-emergency services are coming up and can be looked as a pointer for the future development that the sharing economy can assure (Andersson et al. 2016).
As the world wide sharing economy attains new heights, it effect on the process can be observed as a part-time work and the reputation is seen to be profound. As explained by Kolk (2016), the extensive number of non-employer companies that are seen in United States of America has developed from 15 million to 24 million in the year 2014. The researchers at PwC assessed ten various industrial sectors and projected that within ten years, the five key sharing sectors that is inclusive of the peer-to-peer lending, staffing online, accommodation that is peer-to-peer, sharing of cars, video and music streaming that will create more than half of the overall worldwide revenue from the initial figure of five percent of the current share. According to the research that has been undertaken by Bocken, Rana and Short (2015), 72% of the American citizens have the belief that they would make use of the services with the help of the sharing economies in the coming two years. The UK Office for the National Statistics utilises a range of metrics that varies from the online purchase values to the amount that is paid to the marketing services and in the year 2015, there have been around 275 European “collaborative platforms” that have been able to create £4 billion revenue and have aided £28 billion in transactions.
Future Development Estimates
In order to have an understanding of the future sharing economy, it is essential to address the table that is given as follows:
The figure that is shown above, explains that rise in the revenues from the conventional rental industry will be unassertive in accordance to the outburst of the revenues in the shared economy. The report that is created by PwC disaggregates this development among the sectors. As explained in the next figure, the development estimations from the shared economy is essentially higher in the sectors like online staffing, sharing of cars, crowdfunding etc. The developmental projections have been low for the conventional sectors like the cars, equipment and rentals of DVD.
The fast developing valuation of the companies like Airbnb and Uber, which are the two principal organizations in the sharing economy, acts as an indicator of the potentiality of this sector. The two companies have observed increasing of the valuations in the previous three years. The huge developments, on the other hand are even suggestive of the promising phases of the life cycle of an organization (Lieder and Rashid 2016). The rise in the valuations can only be maintained with the help of the fundamental innovations in their business activities. By looking at the global characteristics of these organizations, their potential development of the future will even be reliant on their capability to adjust to the local scenarios.
There are several factors for the development of the platforms of the sharing economy. The factors include flexibility that is given to the contractors. Barile et al.(2016) concentrated on this aspect of sharing economy platforms and explains it as the digital matching companies that makes use of the user-ratings and IT in order to provide workers who are self-employed with schedules that are flexible. The other factor has been the low entry barrier for the employees. A research was undertaken by Wallace and Sheldon (2015) on the labour market of Uber have discovered key data related to demography and incomes. In comparison to the ordinary cab drivers, the drivers of Uber on an aggregate are better educated, younger and are less diverse.
Conclusion
The report that has been constructed in order to assess and examine the issues that are related to the sharing economy from the point of view of the business. There have been several journals and articles that have been used in order to assess sharing economy and after the assessment of the sharing economy, it can be explained as sharing economy is a developing aspect that if incorporated properly can be fruitful to the organizations. The advent of digitisation has been an effective factor for the development of sharing economy and accordingly companies use these platforms with the help of which they are able to increase their revenues and maintain competitive edge. The sharing economy is enhanced with the help of crowdfunding and crowdfunding has a variety of platforms with the help of which funding requests for sharing economy can be understood. The results that have been gathered from the assessment of the several articles and reports have explained that sharing economy in the near future can be helpful for the companies that are making use of it and accordingly will be beneficial for making profits for the business.
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