Building on the success of a new wave of businesses such as Airbnb, Rentmyitems and Zipcar, the government will today (29 September 2014) launch an independent review of the sharing economy.
Technology-based business models that help people share their property, time and skills are revolutionising traditional sharing practices and building a new wave of everyday entrepreneurs. From carpooling, to house swapping and time sharing, the sharing economy empowers people to hire out their power drills and spare rooms and get the most from their assets.
It is estimated that 25% of UK adults are sharing online, and current global revenues of around £9 billion could reach £230 billion per year by 2025. The sharing economy is estimated to reach 50% market share in key sectors such as holiday accommodation and car-sharing/car rental 2025.
The review will make recommendations, based on the remit below:
- challenge and define the concept of the sharing economy
- explore the potential benefits of the sharing economy to the UK, as well as any risks it may pose to traditional industries
- understand the main issues faced by businesses within the sharing economy, such as the role of insurance policies on new firms like Airbnb
- understand the regulatory burdens faced by sharing economy companies
- understand the barriers to digital trust
- understand how the sharing economy can reach its potential in the UK
Led by Debbie Wosskow, the CEO of Love Home Swap, this review will assess the opportunity for the sharing economy to create a nation of micro-entrepreneurs and radically transform the way we use our assets and resources. For instance, the average car sits idle for 23 hours a day and so car clubs such as easyCar Club allow owners to rent out their car when they are not using it.
Likewise, the average power drill is used for an estimated 12 to13 minutes over its entire lifetime and so services such as Streetclub offer an online market place to hire out spare tools.
But it is not just budding entrepreneurs that will benefit. The sharing economy has the potential to ensure that customers get the best deal going. Co-working services such as NearDesk give small businesses access to office facilities, without entering into costly and risky long-term leases.
The review team will work closely with a wide range of stakeholders, including consumers and more established businesses that are moving to new collaborative models, as well as mainstream businesses that are facing increased competition from these new services.
Business and Enterprise Minister Matthew Hancock said:
The sharing economy is disrupting existing markets and changing the face of business. By opening doors for everyday entrepreneurs to trade directly with each other online, these new market places are driving down costs and pushing the frontiers of innovation.
Debbie Wosskow will unpick the policies and regulations that surround the sharing economy and present a route map for making the UK the global centre for the sharing economy.
These new business models put money into households the length and breadth of the country by helping them get the most from their spare assets and get the best price in the market.
There’s huge economic potential for the sharing economy and I want to make sure that the UK is front and centre of that, competing with San Francisco to be the home of these young tech start-ups.
By backing the sharing economy we’re backing the innovators, the competitors and the agitators. We’re making sure that Britain is at the forefront of progress and by future proofing our economy we’re helping to protect the next generation.
This is all part of our long-term economic plan to build a brighter future for Britain.
CEO of Love Home Swap and review lead Debbie Wosskow said:
Over the past 12 months, we’ve seen the sharing economy explode into life.
Collaborative businesses such as Airbnb and BlaBlaCar are attracting much attention, significant investment and disrupting traditional business models across a broad range of sectors – as well as generating a degree of regulatory challenges.
With increasing UK economic impact, the opportunity is great for companies big and small – and for individuals all across the country to turn themselves into successful ‘sharing economy’ micro-entrepreneurs.
I’m excited to lead this review for the government and look forward to working closely with a wide range of organisations throughout the process on all sides of the conversation.
The focus of the review will be on 3 well-established areas – personal and commercial space; transport; and time and skill sharing. It will also look at sectors where there is significant growth potential, including fashion, food and personal items such as power tools.
The findings of the review are expected to be published by the end of the year (2014).
Notes to editors:
- The full Terms of Reference and call for evidence for the review can be found at Sharing economy review: terms of reference. A call for evidence can be found at Independent Review of the Sharing Economy - Call for Evidence.
- Debbie Wosskow is CEO of Love Home Swap, an international online travel club, and Founder of the Collaborative Consumption Europe network. Debbie is a regular commentator on the sharing economy in the press, a trustee of Hampstead Theatre and sits on a number of advisory boards.
- PwC published research on 15 August 2014 showing that 5 key sharing economy sectors could generate £9 billion of revenue to the UK by 2025.
- One of the key findings of Nesta’s research into the collaborative economy is that 25% of UK adults used internet technologies to share assets/resources over the last year. More information can be found at Making Sense of the UK Collaborative Economy.