As the name suggests sharing economy basically enable people to share their idle cars, accommodation, bicycles, household appliances and other items or any services with the people willing to pay them for the use. These services connect the owner of underused assets with others willing to pay to use them.

According to Researcher Christopher Koopman, an author of the George Mason report, sharing economy allows people to take idle capital and turn them into revenue. The services which are based on sharing economy acts as a matchmaker who allocate resources where they needed and takes a small cut in return. . The disruptive element of the technology is that it allows a user to connect to people who have spare resources and are willing to share them (hence the term sharing economy).

Sharing economy is basically sharing of creation, production, distribution, trade and consumption of goods and services by different people and organisations.

This sharing economy works on "peer-to-peer" (P2P) model which offers numerous advantages by tapping underutilized resources. This economy can improve consumer welfare by offering new innovations, more choices, more service differentiation, better prices and higher quality services. The internet makes it cheaper and easier than ever to aggregate supply and demand. Smartphones with maps and satellite positioning can find a nearby room to rent or car to borrow. Online social networks and recommendation systems help establish trust; internet payment systems can handle the billing. All this lets millions of total strangers rent things to each other. The result is known variously as “collaborative consumption”, the “asset-light lifestyle”, the “collaborative economy”, “peer economy”, “access economy” or “sharing economy”. This sharing economy is more flourished mainly in US, Eastern Europe, South Korea, New Zealand and in Australia.

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It is whole new disruptive model which entered into several segments. Lets have a look at some of it segments.

Sharing economy segments:

1. Accommodation People are taking spare bedroom, cars, tools they are not using and becoming their own entrepreneurs. Such peer-to-peer rental schemes provide handy extra income for owners and can be less costly and more convenient for borrowers. Occasional renting is cheaper than buying something outright or renting from a traditional provider such as a hotel.The best-known example is Airbnb, based in San Francisco, which has helped 4m people find places to stay since it was founded in 2008—2.5m of them during 2012 alone. Travelers can rent a room or a whole home or a British castle on Airbnb. Airbnb takes a cut of 9-15% of the rental fee. Others offering similar services include Roomorama, Wimdu and BedyCasa.

2. Ride sharing Car-sharing schemes divide into peer-to-peer car-rental services in which you pay to borrow someone else’s car (Buzzcar, Getaround, RelayRides, Tamyca, Wheelz, WhipCar) and taxi-like services (Lyft, SideCar, Uber, Weeels) in which people use their cars to ferry paying passengers. Some peer-rental schemes focus on particular types of customer, such as students, or particular types of vehicle, such as

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high-performance cars. Peer-to-peer taxi services use location-aware smartphone apps, coupled with a central dispatcher, to bring drivers and passengers together.

Some peer-rental services (including Airbnb, RelayRides and Lyft) integrate with Facebook to let owners and renters check to see whether they have friends (or friends of friends) in common. All the above services focus on creating trusting community when it comes to attracting users.

Uber is the best known platform in the sharing economy, having reached a valuation of $40 billion while expanding to more than 200 cities in 54 countries. Getraround, Relay Rides, Liquid to rent bike , Lyft, SideCar are some of the other popular ride-sharing services.

Park at my House provides affordable and fine-free parking which enabling property-owners to rent out their empty driveways, garages, and car parks to drivers needing somewhere to park.

3. Logistics Logistics companies have come up with the share-economy model to improve their green sustainability and even to cope up with skyrocketing prices of fuel. in any consignment when there is free space in their vehicle they allow other businesses to book in for the extra space left. This reduce their operational cost, even businesses are benefited when their costs are cut for the idle space they are not using.

Schneider’s Integrated Delivery Service (IDS) is a shared-channel approach where competitors who move freight in the same geographic markets are actually sharing supply chains. Kimberly-Clark logistics are also in this space.

4. Warehouse (Multi-Client Warehouse) Idle warehouse spaces are also rent out to the business in need of it. This collaborative warehouse space, which includes its labor and equipment, drives down the cost per unit. It also lets the business to economically expand the warehouse footprint to accommodate growth. This requires letting a business pay only for the space and labor they require. Multiple clients in a single distribution center share costs.

California based Weber Logistics, Ohio based ODW logistics are some of the well-known multi-client warehouse service provider.

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5. Co-working Space

Coworking is a flexible and community-oriented workspace option for business travelers, independent workers, and entrepreneurs. The startups in these sectors are the real-time marketplace model to office and meeting space which are shaping the future of commercial real estate.

LiquidSpace is the largest real-time marketplace for professional meeting and workspace.

6. Finance The sharing economy is already reshaping the industry through P2P lending, social payments, crowdfunding and P2P insurance. All kinds of crowdfunding sites can be considered over here.

Kickstarter is a crowd-funding site powered by a unique all-or-nothing funding method where projects must be fully-funded or no money changes hands. Lending Club is the well-known online lending platform. Policybazaar in india is another online service provider which helps finding suitable policy to the buyer.

7. Food There are some peer-to-peer platforms where people make food and sell to the people in need to buy it. Here the sellers are willing to share their resources with the buyer. This provides a great option to home cooked food lover.

EatWith and MealSharing can connect you with a person who is willing to cook a meal for you.

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8. Market-place Household ServicesThis segment can be called as the most disrupted of the sharing economy. These marketplaces connect the blue collar professionals for household work with others willing to pay to use them. They basically acts as peer-to-peer marketplace for the common yet complicated household task such as repairing, cleaning, handiwork, moving of assets work and other blue-collar jobs.

TaskRabbit is a mobile marketplace for people to hire people to do jobs and tasks, from delivery, to handyman to office help. Founded in 2008, the site has 4,000 Taskrabbits on the service nationwide who bid to do tasks that are posted by people looking for a service. All the "rabbits" are interviewed and have their backgrounds checked before going on the system. Similar services in India are Housejoy and Doormint which are popular.

DogVacay is a pet-sitting service which allows dog owners to leave their dog with a host who will take care of them. It's cheaper than a kennel and gives dogs a more comfortable place to stay, the company says.

9. Household Lending There are various peer-to-peer rental sites for household goods like kitchen appliances, gardening tools, home décor, apparels, handbags, popular designer shoes, toys, children wearing and many more. Snapgoods is the site for lending and borrowing high-end household items, such as cameras, kitchenware or musical instruments.

10. Music or Video streaming, Books and other media In this space music, video, books or games are shared with a charge rent on it.

Swap.com is the leading online swap marketplace for books, movies, music and games. They are now swapping everything from apparels to toys and baby products.

11. Others Startup Fon enables people to share some of their home Wi-Fi network in exchange for getting free Wi-Fi from anyone of the 7 million people in Fon's network. Boatbound offers short-term, peer-to-peer boat rental. There are also peer-rental sites for car-parking spaces (Airbnb for cars, in effect), bicycles, photographic kit, musical instruments, garden equipment, outdoor gear, and so on.

The research firm PwC estimates that these five sharing economy segments could be worth $335 billion by 2025, up from just $15 billion today. All these services rely on ratings and reciprocal reviews to build trust among their users. Many platforms also carry out background checks, looking into their users’ driving and credit histories and checking for criminal records

As they become more numerous and more popular, however, sharing services have started to run up against snags. There are questions around insurance and legal liability. Some services are falling foul of industry-specific regulations. As the sharing economy expands, it is experiencing growing pains. Landlords are clamping down on tenants who sub-let their properties in violation of the terms of their leases. Tax collectors are asking whether all the income from sharing schemes is being declared.

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Meanwhile, the big boys are moving in, as large companies that face disruption from sharing schemes start to embrace the model themselves.

This transition will have a positive impact on economic growth and welfare, by stimulating new consumption, by raising productivity, and by catalyzing individual innovation and entrepreneurship. Some industries -- like taxi services in transportation and B&B rentals in travel – are envisioned to be completely transformed, while others, such as financial services, will be only peripherally impacted. This is part of the 'technology revolution,' as well as a new norm. It is also discussed by many researchers that it is great for people to have an option to work in their spare time and make extra money, but that it still lacks the benefits of full-time employment. What looks like a disruptive new model will probably end up being mixed into existing models and embraced by incumbents.

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Ref:

http://www.stern.nyu.edu/experience-stern/news-events/prof-arun-sundararajan-s-congressional-testimony-sharing-economy-citedhttp://www.dailymail.co.uk/wires/afp/article-2939000/Sharing-economy-reshapes-markets-complaints-rise.htmlhttp://www.thepeoplewhoshare.com/blog/what-is-the-sharing-economy/http://www.economist.com/news/technology-quarterly/21572914-collaborative-consumption-technology-makes-it-easier-people-rent-itemshttp://techcrunch.com/2015/01/03/the-sharing-economy-and-the-future-of-finance/http://www.prnewswire.com/news-releases/liquidspace-raises-14-million-in-additional-funding-280902432.htmlhttp://www.collaborativefinance.org/sharing-economy/http://www.insightonbusiness.com/5735/shipping-logistics-%E2%80%93-sharing-the-ride-%E2%80%93-local-shipping-logistics-companies-use-technology-to-innovate-for-clients/

*A Peer-to-Peer, or P2P, Economy is a decentralized model whereby two individuals interact to buy or sell goods and services directly with each other, without intermediation by a third-party, or without the use of a company of business. The buyer and the seller transact directly with each other. Because of this, the producer owns both their tools (or means of production) and their finished product.

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