Newspaper print subscribers are dwindling and Amazon’s shipping costs are soaring. For this reason, Chicago’s major newspaper delivery trucks were delivering more than the morning papers this fall.

In a partnership trial that could prove to reduce costs if implemented on a larger scale, Amazon worked with the Chicago Tribune to deliver packages to residents along the Tribune’s paper route. Companies like Uber and Roadie Inc., among others, have also begun making deliveries.

As highlighted by these recent measures, more businesses need to embrace the benefits that stem from a “sharing economy.” This system is characterized by the shared production or distribution of a product or service between two or more parties. The shift to this economy can be used as a powerful platform to share goods and resources, which ultimately reduces costs and streamlines transactions.

Amazon is leading the way in this trend. The company announced “Amazon Flex” earlier this month, which is “coming soon” to major cities across the United States. The program will essentially be the Uber of package delivery, in which regular people would deliver items, proving to be another effort by a major firm to maximize resources.

The “sharing economy,” is nothing new, but its past success proves its reliability in the marketplace. In recent years, firms like Uber, Airbnb, and SnapGoods have grown enormously. In 2014, Forbes estimated the revenue generated in the sharing economy grew $3.5 billion, a growth rate of 25 percent.

“As an economist, the sharing economy certainly has my fundamental sympathy,” said Don Dutkowsky, a professor of economics in the Maxwell School of Citizenship and Public Affairs. “Economists are all about the idea that resources are finite and [we] can use them most efficiently to satisfy human wants and needs.”

Americans have had shared resources throughout history, especially during troubling economic times. Dutkowsky noted that when the Great Depression hit, people rented out rooms in their houses and sometimes their entire houses, often in response to dire conditions. Even in today’s recovering economy, 56 percent of Airbnb hosts in San Francisco rely on the service to help pay rent, according to the company’s website.

A sharing economy often acts as a product of a mediocre private economy, Dutkowsky said. In this sense, sharing resources becomes an outlet on which struggling families can rely. It makes sense: With the emergence of the economic recession in 2008 came the sharing economy’s prevalence, and it continues to thrive seven years later.

And consumers can bet it will continue to. The only real pitfall is a lack of trust; many customers fear the notion of non-professionals handling their products and services and making deliveries to their residences.

But customers were fearful of online shopping when it first started. Over time, customers gradually grew comfortable with it and chances are the same will happen with the “sharing” economy.

The businesses that recognize the opportunities within the “sharing economy” will be best positioned for long-term success. As long as the private economy does not see tremendous growth, businesses that get involved in the “sharing economy” now should expect to garner its advantages. These firms would have a leg up in managing the logistical components of it and be better positioned to adapt.

Matthew Gutierrez is a freshman journalism and entrepreneurial management dual major. His column appears weekly. He can be reached at mguti100@syr.edu and followed on Twitter @MatthewGut21.

Published on October 28, 2015 at 12:23 am