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Wednesday 18 November, 2015


How can the shared economy help address resource scarcity?

I recently attended a roundtable on resource scarcity as part of Coca-Cola Enterprises’ Rethinking Business series. Zipcar might not be the most obvious choice of participant as we’re more readily associated with the sharing economy than the circular economy. The two, however, have much in common, in terms of purpose and outcomes. The circular economy seeks to achieve maximum utility and longevity from any natural resource we extract or harvest, process and re-process; and the sharing economy unlocks utility of previously idle assets, by enabling people to access them conveniently through online platforms. Assets might include physical things, such as accommodation and cars, as well as people’s time and skills. With most cars parked and depreciating 96% of the time, it’s not difficult to spot the need and opportunity for car-sharing.

In the context of addressing resource scarcity, then, let’s consider the benefits of transitioning to a more shared economy.  

Firstly, individuals and businesses in cities benefit because they get what they really want: access to what they need when they need it, rather than inflexible and capital intensive ownership/leasing. Today’s technology makes this access easy to use and convenient. The result is a lower cost of living/operating and less hassle, since ownership comes with burdensome obligations.

There are also wider societal benefits because of behaviour changes exhibited by consumers when using these models. With Zipcar, for example, members only drive when they really need to, notably avoiding the car for local trips (of less than five miles). That means less congestion and more effective use of, for example, public transport services (which are always running, in any event). What’s more, the savings from avoiding ownership of a depreciating asset can be redirected into the local economy.

The planet and the environment benefit from pulling all of the above together. In our case this has meant that:

1. Fewer cars need to be manufactured (meaning less natural resource consumption, less energy used in the manufacturing process, less shipping from factories to market) – every Zipcar shared removes 17 privately owned cars from the streets;
2. Fewer miles are driven, meaning less fuel consumed; and
3. Existing infrastructure (e.g. roads) is used more effectively, obviating the need for unnecessary expansion and construction.

The challenge, then, is to take this mainstream and achieve all these benefits at scale.  That requires the continued innovation of companies coupled with bold action from policy makers, to reduce our longstanding dependency on things consumers have traditionally always owned such as cars and properties.  Already, we see Paris and Beijing rationing car use, on days when pollution exceeds certain limits.  As cities around the world continue to grow, improper use of the car becomes ever more unjustified.  The next step will be for cities to positively incentivise people to travel by public transport, cycle and walk, as much as possible; and only drive when they really need to.

 

Mark Walker

General Manager, ZipCar UK

Mark Walker is the UK General Manager of Zipcar, the world’s largest pay-as-you-drive car club.  A former Streetcar non-Executive Director, Mark joined the business full-time in 2010. Mark is committed to making a positive difference to urban environments by establishing new business models that are commercially successful, become mainstream, and that inspire other disruptive entrepreneurs to do the same.

Under Mr Walker’s leadership, Zipcar helps form part of a smarter transportation system in the UK, complementing public transport, reducing congestion and improving air quality, by taking cars off the road. Today, Zipcar has over 900,000 members and more than 10,000 vehicles in urban areas across the United Kingdom, United States, Canada, France, Spain, Austria and Turkey. In the UK, Mark oversees Zipcar operations in London, Bristol, Cambridge and Oxford, alongside local authority partnerships in Kent.   London is the largest Zipcar network in the UK, with thousands of cars across 31 London boroughs.

The Zipcar model is based on positive collaboration and pay-for-use business model, which is relevant to businesses and consumers alike.  It’s convenient, cost effective and good for the environment.  Mr Walker is committed to supporting a future of greener cities and, in 2015 along with his team and the Car Lite London project (www.carlitelondon.org),  has been instrumental in raising awareness in the UK of the benefits of car clubs and motivating London’s authorities to develop a clear Strategy for Car Clubs in London.

Prior to Zipcar, Mr Walker worked in the investment banking industry, holding a number of senior positions, latterly as Managing Director of the UK Branch of Carnegie Investment Bank AB, between 1998 and 2010.

Mr Walker has a BSc (Hons) in Data Processing and Management Studies at the University of Leeds. 

http://www.zipcar.co.uk/

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