How to Use the Sharing Economy to Benefit Your Business

Running a small business has a lot of perks to it.

A huge budget usually isn’t one of them, so small businesses have to continually look for ways to stretch a dollar and make the most out of the operating budgets they do have. Finding ways to save on expenses while increasing profits is necessary to stay afloat.

One way for small businesses to save on costs associated with running a business is to utilize today’s economy of sharing.

With the nation’s workplaces being filled with Millennials, companies are changing the way they do business. Instead of larger corporations keeping their cubicles filled with life-long, dedicated employees, companies are now hiring employees who are more caring, sharing, and have a lower level of commitment than their older peers in the business world.

For smaller businesses with fewer employees, this millennial mindset and the sharing economy, sometimes called “collaborative consumption,” can save money on operating expenses and raise profits if done correctly.

Let’s look at a few ways that small businesses can utilize the sharing economy and make it benefit the bottom line:

Raising Capital

Unless you’ve been stranded on a desert island for the last 5 years, you’ve likely heard of crowdsourcing, and the sites that aspiring entrepreneurs, those raising funds for medical expenses, and others use in their fundraising efforts.

Instead of going door-to-door selling wrapping paper or candy, or hitting up relatives for capital, small businesses can turn to crowdsourcing as a means for raising capital. Although video games and movies are the most funded projects in crowdsourcing, anybody can put an idea out there and offer special perks to those willing to invest in it.

Crowdsourcing can save time for businesses when raising capital, and also be an easier way to come up with funding than applying and qualifying for a traditional bank loan.

Business Trips

With business hubs in the United States being mainly on the east and west coasts of the country, there will most likely be a need for business travel now and then for small businesses.

Costs in transportation and lodging can really add up, and since ride sharing for airplanes hasn’t really caught on yet, businesses can save the most by using shared car rides and accommodations. Whether it be a ride to the airport, or to a meeting from the hotel, small businesses can save on transportation costs by using services like Uber and Lyft.

Small businesses can also save on local transportation by using these services instead of purchasing and maintaining a fleet of vehicles. Small businesses can save up to 50 percent of lodging costs by using services like Airbnb.

Outsourcing Small Tasks

Small businesses can outsource a lot of small tasks to outside providers. Handyman services, painting, cleaning, and maintenance can be outsourced to the lowest bidder on sites like AskforTask. You can also find the services of a logo designer, app developer, and writer from freelancers on sites like Fiverr.

Monetize Space

Do you have extra offices in your building that aren’t being used? Space for a cell tower? Unused parking spaces? You can turn all of these assets into money for your bottom line by utilizing the sharing economy to rent them out. In some cities, parking spaces are worth $50,000 a year.

Hiring Temps

Using a service like Wonolo, you can hire temporary employees to work just 3 hours, 3 days, or 3 weeks. You can even use these services to hire temporary to permanent employees. You can use a service like this just to find temps to perform menial tasks like sending out mailers, but more and more businesses are using them to fill longer term positions like web design.

When done properly, and small business can use collaborative consumption, or the sharing economy, to save money in the short term and the long run. Small businesses can also form relationships with individuals and other businesses that can be mutually beneficial to both.

Change to SAFE Mortgage Licensing Act Would Benefit Small Lenders

A bill now moving through the Senate is being hailed as a triumph for small business. The legislation, if approved, would make it easier for loan officers leaving a big bank to take a job with a small independent lender or start a brokerage.

The bill, H.R. 2121, referred to as the SAFE Transitional License Act of 2015, introduced by Rep. Steve Stivers (R-OH) in 2015, modifies the SAFE Mortgage Licensing Act of 2008 by giving mortgage loan originators a 120-day grace period to obtain a new license when changing jobs so they can continue to originate loans.

H.R. 2121 in Detail – SAFE Mortgage Licensing Act Changes

The bill’s provisions apply to loan officers who move from a federally insured depository institution, such as a bank or credit union, to an independent mortgage bank or brokerage firm, some of these small businesses. It also provides transitional authority to mortgage loan originators who move from one state to another. To qualify, these individuals would have to be employed by a financial institution for the previous 12 months.

Loan originators employed by federally insured depositories must obtain a state license to become a mortgage loan originator at a non-bank institution. The process can take weeks or even months to complete due to stringent requirements that include pre-licensing and annual continuing education requirements, passage of a comprehensive test and criminal and financial background checks. They must also register with the National Mortgage Licensing System and Registry.

Because the SAFE Act of 2008 contains no transitional license provision, it “inhibits job mobility and puts independent mortgage lenders at a considerable disadvantage in recruiting talented individuals,” Stivers said in a press release announcing the bill.

Proposed SAFE Mortgage Licensing Act Change Gives Grace Period for Loan Brokers

Unless the new bill passes, loan officers who move from federally-insured institutions to a non-bank lender must “sit on their hands for weeks, even months, while they meet the SAFE Act’s licensing and testing requirements,” he said.

H.R. 2121 is a simple solution that would allow these individuals to continue working and underwriting loans, while in no way weakening the consumer protections of the SAFE Act, according to Stivers.

H.R. 2121 a Small Business Jobs Bill

Both Stivers and Rep. Jeb Hensarling, Financial Services Committee chair, agree that this is a job’s bill that affects small businesses.

“This is a jobs issue, providing qualified mortgage professionals more portability and a minimal amount of work disruption when making a change in an employer,” Stivers said in a press release announcing House support for the bill.

In an email to Small Business Trends, he added, “This bill reduces the regulatory burden on small businesses and lenders by ensuring qualified mortgage professionals can continue to originate loans during a work transition.”

Hensarling, in a Financial Services Committee press release, said, “I believe most of us would agree that our economy works better for all Americans when small businesses can focus on creating jobs rather than navigating bureaucratic red tape.”

Support for the SAFE Act

Industry groups such as the Mortgage Bankers Association (MBA), Community Home Lenders Association (CHLA) and the National Association of Independent Housing Professionals (NAIHP) strongly support the bill. Leaders from each group made the following comments in a statement:

“In today’s dynamic mortgage marketplace, this bill addresses the need for true labor force mobility across state lines and between institutions,” said MBA chairman Bill Cosgrove. “It also offers no new regulatory burdens, and is well within the guardrails of current oversight by state regulators and the Consumer Financial Protection Bureau.”

Following the passage of the SAFE Act of 2008, many broker lending officers went to work for the banks, said NAIHP president Marc Savitt.

“The Stivers’ bill will make it easier for lending officers to return to the brokerage business,” he said. “We will welcome them back to the brokerage side.”

CHLA executive director Scott Olson said his group is urging the Consumer Financial Protection Bureau to require consumer disclosures regarding a lenders adherence to the SAFE Act.

“Such disclosures would show if lending officers are licensed and meet all the requirements of the SAFE Act, including an independent background check and continuing education courses,” he said.

H.R. 2121 came out of the House Financial Services Committee and was co-sponsored by Representatives Terri Sewell (D-AL), Joyce Beatty (D-OH), Lynn Westmoreland (R-GA), Kyrsten Sinema (D-AZ) and Luke Messer (R-IN).

The bill recently won the support of the House and has now been passed along to the Senate Committee on Banking, Housing, and Urban Affairs, for consideration.