Answer to Question #245416 in Economics for hmm

Question

what are the advantages to retailer to sharing inventory. For suppose you go to a car dealer to find a blue model and he doesn't have that model in stock. Typically he will obtain the model from the another local dealer. What are the disadvantage

to the retailer?

Answer 1

The sharing economy has become common practice in recent years. New services and apps are emerging to help those looking to make extra money by contacting those looking to rent something. The range of things to bring to the sharing economy is endless. In fact, it is not unusual for consumers to rent out their homes, bicycles, cars, camping equipment, boats and other unique items or services.

Before moving on to a sharing economy, it is important to consider the pros and cons of this additional revenue stream. While many people usually only see the benefit of renting out their items for cash, they don’t understand how much maintenance will be required or the wear and tear that can occur to these rented items over time.

The advantages of sharing economy for “owners” include additional income opportunities, flexible hours, the ability to concentrate on other matters - both personal and business processes.

For potential "customers" the obvious advantage is the ability not to make large purchases for something that they can only use once or twice.

However, since the sharing economy is a relatively new venture, the legal framework that would help protect those involved is not that great.

While some services offer protection to users, Sharing Economy members need to take certain steps themselves (such as getting insurance) to protect themselves and their items in the event of legal action or damage.

Those who cannot afford it simply do without such measures, which can be a significant risk. Security issues also arise as the experiences of many participants are not properly tested. In addition to these more serious problems, inconsistent income and possible depreciation of used items are also important disadvantages.