The sharing economic system has loved a fast rise, significantly during the last decade. It has penetrated most industries, facilitated by enhancements within the efficiency of digital platforms and customers’ rising willingness to make use of cellular apps that assist peer-to-peer enterprise fashions.
Listed under are the macroeconomic trends impacting the sharing economic system theme, as recognized by GlobalData.
Covid-19
The Covid-19 pandemic has brought on vital issues for sharing economic system firms worldwide. With prolonged lockdowns in lots of international locations and the worldwide economic system getting into a deep recession in 2020, firms like Uber, Lyft, Grab, and Airbnb noticed bookings drop sharply.
The gradual reopening of cities and the easing of journey restrictions have resulted in regular progress throughout sectors in 2021. To navigate the continuing disaster, firms should study their present enterprise fashions and capabilities to make sure they’re nonetheless related. For instance, firms like Uber and Grab have been working to offset challenges to their core taxi enterprise by rising their on-demand supply operations, together with meals and grocery deliveries.
China’s sharing economic system
The sharing economic system in China has developed quickly lately and is anticipated to rebound post-Covid-19, in line with a report revealed by the State Information Center of China. The report forecasts that the Chinese sharing economic system will preserve an annual progress price of 10% between 2020 and 2025, having registered complete transactions of CNY3.4 trillion ($522bn) in 2020. The Chinese sharing economic system had a complete workforce of 84 million folks in 2020.
China has adopted a normal regulatory framework for all sharing economic system actions, and the federal government has created insurance policies to encourage progress. Currently, the regulatory surroundings is fragmented. The rules are largely industry-specific and are applied by native governments and departments.
The sheer scale of China’s economic system and the Chinese authorities’s deal with standardising sharing economic system actions to drive GDP will proceed to supply progress alternatives for sharing economic system firms. The State Information Center expects the sharing economic system to contribute 20% to China’s GDP by 2025.
Urbanisation
By 2050, 68% of the world’s inhabitants will dwell in cities, up from 56% in 2020, in line with the UN Conference on Trade and Development (UNCTAD). Increasing urbanisation presents points for the automotive {industry}. Owning private transport in concentrated city environments is more and more sophisticated as a result of components corresponding to parking, utilization restrictions, and insurance coverage prices. Consequently, there might be continued progress in demand for shared autos whereas the quantity of privately-owned autos will decline.
Similarly, fast urbanisation coupled with restricted housing choices has pushed the necessity for shared lodging in city areas. In cities with a demographic of youthful folks, there was a surge in demand for professionally managed co-living or scholar lodging. According to a scholar lodging survey performed by Knight Frank and the Universities and Colleges Admissions Service (UCAS) in 2020, 50% of scholars choose to maneuver immediately into the non-public rented sector instantly after commencement.
Sharing economic system strategic partnerships
Old economic system firms throughout a spread of sectors have cast strategic partnerships with sharing economic system firms to promote sharing economic system providers. For instance, in June 2020, Volvo partnered with Waymo to develop an autonomous electrical car for ride-hailing providers.
For their half, sharing economic system firms use strategic partnerships to increase their service traces, enhance their geographical presence, and purchase new prospects. For instance, in September 2020, Uber Freight partnered with KeepTruckin, a fleet administration expertise firm. BlaBlaCar has partnered with Voi, a European e-scooter service, to launch BlaBla Ride in France.
The variety of strategic partnerships will proceed to develop within the subsequent few years, permitting conventional and sharing economic system firms to enter new markets and repair segments, enhance operational effectivity, and supply extra providers to customers.
Environmental, social, and governance (ESG)
The sharing economic system is predicated on the precept of sharing or renting belongings. This results in a diminished want for items, which leads to diminished manufacturing. A lower in manufacturing ought to imply much less air pollution, supporting environmental sustainability.
Sustainability is essential to customers. A 2020 report from IBM discovered that 57% of customers have been prepared to vary their procuring habits to scale back environmental influence, and 72% of individuals have been prepared to pay a premium value for the manufacturers that assist recycling, observe sustainability, or are environmentally accountable.
Sharing economic system firms can spend money on sustainable enterprise practices to provide environmental advantages whereas being cost-efficient in the long term. For instance, Uber has launched Uber Green in 1,400 cities in North America and incentivised its drivers to make use of all-electric and hybrid autos.
Increasing shopper consciousness of sustainable life, rising shopper participation within the sharing economic system, and the long-term financial advantages of sustainability for enterprises will drive firms’ investments over the approaching years.
This is an edited extract from the Sharing Economy – Thematic Research report produced by GlobalData Thematic Research.