Is sharing the future of retail?


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Is sharing the future of retail
Is sharing the future of retail

Sharing is good, and with digital technology, sharing is easy.
-Richard Stallman

“What’s mine is yours” has been a common statement among best friends and partners, but businesses are taking it a step further with “what’s mine is yours, but for a fee” to unite consumers and generate revenue out of things when not in use. Yes! It is about shared economy. Shared economy or peer economy is when private people are renting out their cars, homes or other assets, when they do not use them. Multiple industries like hoteling, car rental are already getting revolutionized with companies like Airbnb, RelayRides, etc. Many other start-ups are coming up with ideas of portals for shared workers, personal goods, etc. for a minimal charge.

Retail and Shared Economy

According to December 2014 PricewaterhouseCoopers survey, only 2% of US consumers had conducted a sharing economy transaction in retail. This may seem to be a much lower percentage compared to entertainment or automotive sectors but considering the predictions by Juniper Research, the rise of sharing economy is set to reach $20 billion globally by 2020.
Shared Economy & Retail
Multiple companies and sites like Rent the Runway and Beg, Borrow or Steal are built on the idea that consumers who can’t afford to buy luxury goods or simply don’t want to spend over the odds, can rent luxury products as a short-term alternative instead. These help in nurturing the shared economy in retail. With the rate consumers are upgrading to luxury lifestyle with not much increase in per capita income, sharing seems to be the most effective option to fulfill the desires. Big retailers should take a note of it and should come up with such offerings to attract more customers. It’s better to try now and take the lead then be late and follow others.

But now the question arises, is it only for luxury products or daily use products also. The obvious reaction would be “You can’t share your daily soap or toothbrush”. I totally agree, sharing sounds more beneficial for products which are difficult for all people to own. But then, there are multiple daily use items like bicycles, cars, etc. which can be shared when not in use by owner or you can rent it only when in need.

This is how consumers will be benefitted with better prices, better service and more products. It also helps build trust among community users. But how will retailers use this sharing model and benefit from it. Again for simplicity considering a bridal dress retailer, which can come up with offers like pay, use and return. This will not only help them to get more consumers which earlier couldn’t afford to buy costly dresses and now can rent it. Moreover, same product can be sold out at lower prices after couple of rents.

What more? Can supply chain be also shared?

Seems like absurd idea to why a company/retailer would share its supply chain with another company. That’s true, but isn’t it good to share when it’s a win-win situation for both parties. Let us consider the example of Kimberly-Clark which partnered with cosmetics manufacturer Lever Fabergé to share transportation for a pilot chain of stores. This collaborative distribution resulted in cost savings, shortening of cycle time, reduction in holding inventory and increase in on-shelf availability. They took this shared relationship further to have a shared distribution center with the help of Third Party Logistics Company. It is an excellent example of how supply chain can be shared.

Although collaboration is becoming a hot trend right now, supply chain managers should think carefully before they get involved. They should be cautious about who they get into a relationship with because getting out of it once it is set up could be quite difficult.

Sharing of supply chain might not look lucrative for manufacturing companies but for retailers which ship millions of products with innumerable unfilled trucks or underutilized warehouses, can surely think of partnering with other companies to completely utilize the facilities while incurring lower costs. This largely applies to fashion and specialty retail which sell unique but counted products every season.


Collaborative consumption or sharing is a promising major trend in retail space and will transform how retail industry works. It would be interesting to keep an eye on the trend of what consumers would be demanding in future and how retailers are going to keep up with the expectations and what role shared economy going to play.

Aakash Varma
Tata Consultancy Service (TCS)
Aakash Varma is a Manager, Replenishment at Walmart India Pvt. Ltd. responsible for maintaining stock availabilities for all the stores across India. Prior to that, he was working as a Functional Consultant, Retail Supply Chain working with leading global retailers across USA, UK, APAC mainly in the area of Process and Business consulting across End to End Value Chain. He is a post graduate in Supply Chain & Ops from NITIE, Mumbai.


  1. Yes, it is. E-word-of-mouth is important and maybe the most beneficial social channel. The customer experience and long-term relationships are crucial to the digital marketing.

    Good article.


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