With the success of innovative ventures like Uber and Airbnb, it’s no secret that the sharing economy is turning into a booming business for B2C.
And no wonder. The concept of sharing one’s goods and services is perfectly suited to consumers who would rather handle business themselves, than go through a middleman.
Yet there’s one area that seems to be lagging behind B2C when it comes to the sharing economy: B2B.
It makes sense that this sector might not have seen as much success in the sharing economy, especially since it doesn’t function on the same peer-to-peer business model that suits B2C.
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But as technology shifts, the B2B sector is looking to evolve in a way that also allows it to partake in the lucrative sharing economy.
There are still challenges and growing pains in the sharing economy, many of which are amplified when it comes to business regulations and taxes.
How can the B2B sector successfully utilize this new economy, and what aspects of B2B will benefit the most? Let’s find out.
The Sharing Economy Shift to B2B
The idea of the sharing economy has taken off in the last few years, especially when it comes to digital transactions.
As more individuals are connecting online to make sales peer-to-peer (P2P), a whole new market of consumer sales is being created.
Add this to the fact that entrepreneurs are coming up with new platforms and apps to assist with the sharing economy, and the onus is on companies to keep up with the trend or risk falling by the wayside (see the number of struggles traditional taxi companies are currently having with Uber, whose business model is disrupting the entire industry).
For the moment, the B2B sector seems to be pretty well protected from any fallout or scramble due to the sharing economy.
After all, B2B doesn’t directly involve consumers, and you might be hard-pressed to find two businesses working together to share resources, especially if the businesses are competitors.
However, it’s in the nature of B2B to evolve, especially if there’s profit to be had by sharing resources, data, supplies, office space, that might otherwise go unused.
A blog post by Jeremiah Owyang, the founder of Crowd Companies, describes the three points that make up the fundamentals of the sharing economy:
1. Activating idle resources for usage, therefore reducing waste. 2. A paradigm of access versus ownership, therefore reducing ownership as people get what they need on-demand. 3. Using technology to find these idle resources, then accessing the internet of things, mobile devices, social networks, online marketplaces, digital reputations, and online payment systems.”
He makes the point that, regardless of whether it’s B2B or peer-to-peer, these tenets can be applied to any sector.
The sharing economy can work for any business model, even if it’s between two businesses rather than two consumers. And if many markets are truly moving towards the sharing economy model, it may be in B2B’s best interests to find a way to adapt.
There are still legal hurdles to be sorted out with the B2C sharing economy, and they seem to be even more daunting for B2B.
For example, business regulations have been stymieing a number of sharing economy models, PYMNTS.com refers to the recent ruling that Uber drivers need to be classified as employees, not independent contractors, and quotes The New York Times as saying that the precedent set would mean that, “hundreds of sharing economy startups will need to significantly rethink their business models.
In this emerging new economic world, a lot of the old models have yet to catch up, but the B2B presence in the sharing economy might just help tip the scales towards something more fair and sustainable.
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How B2B Will Benefit
You don’t have to look very hard to find B2B companies that are already adapting the sharing economy model.
Many of them are looking to Uber and Airbnb as the examples, and so there are a number of startups and apps devoted to business solutions based around ridesharing and storefront rental.
For a good example, the article on PYMNTS.com mentions a startup called Yard Club: “The company, less than two years old, provides a way for construction companies to share their equipment by renting it out when not in use by their own companies.”
The article also talks about WeWork, which provides working space as needed to business owners, and Floow2, which, “divvies out all sections of the supply chain between companies to make the workflow more efficient.”
When the B2B sector can parcel out the parts of the sharing economy that help with efficiency, quickness of service, and higher profit, then it can be considered a success, even if you might not have heard as much about the B2B sharing economy as you have B2C/P2P.
It’s not just about finding sharing solutions within businesses, either – it’s also about businesses sharing employment solutions through job service programs and management systems.
Companies like oDesk and Field Nation can be seen as examples of how B2B can use the sharing economy to find the best workers for the job.
With many companies currently outsourcing much of their work, this kind of solution is an ideal use of the sharing economy for B2B.
That brings us to the rise in freelancing. In “The Face of The New American Workforce,” Field Nation predicted that 40 percent of the American workforce will be freelancers by the year 2020.
As the freelance world becomes a bigger part of the workforce, more businesses should be looking to implement systems that can help them manage their contingent workers.
This is where B2B could definitely benefit from adapting the sharing economy; by using freelance management systems, many businesses could easily assign projects, communicate with outside staff, and share work between a team of freelance vendors.
Since the number of freelancers in the workplace is only predicted to rise, a company that begins using freelance management systems now might end up being ahead of the curve.
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The New B2B Sharing Economy
Even though B2B incorporations of the sharing economy may not be as well known as B2C’s, it is still an up-and-coming wave of innovation.
Given that B2C has seen much success with platforms like Uber and Airbnb, it seems to be only a matter of time before B2B steps up with an equivalent, or maybe even an improvement, on the original P2P models.
Is your company currently incorporating any parts of the sharing economy in their business model? Let us know about it in the comments.
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