The Sharing Economy’s Impact on Construction
A hallmark of today’s economic landscape is the rise of the so-called sharing economy, the key feature of which is maximizing the utility of fixed assets that aren’t constantly in use, creating a revenue stream for owners and cutting costs for the end customer.
Companies like Uber, Lyft and Airbnb are quintessential examples of the sharing economy model, which all serve as platforms that allow drivers and homeowners to turn a profit from their cars and houses, respectively. Those companies have managed to turn the massive taxi and hotel industries upside-down without owning a single vehicle or building, standing as proof of the sharing economy’s disruptive potential.
That sharing model has been making its way to the construction industry for a few years. According to ConstructionDive, even back in 2015, 54% of building equipment in the U.S. was owned by rental companies, and the peer-to-peer model is robust and thriving. A number of startups today offer apps that facilitate peer-to-peer sharing between owners of trucks and other construction equipment and companies that have a temporary need for them. It’s helped propel the equipment sharing industry to $40 billion a year, according to ConstructionDive.
Trux bills itself as “the first and only comprehensive cloud-based dump truck logistics platform”Trux is a Waltham, Massachusetts-based trucking logistics company that offers a free platform to connect independent dump truck drivers with companies that need their services, but who don’t necessarily need their own trucks. The sharing economy model allows truckers to pick and choose the jobs they take, and lets companies avoid the associated ongoing costs of ownership.
“Our goal is to help drivers, contractors, and material producers run their operations more efficiently with tools like GPS tracking, real-time job notifications, and valuable data insights,” Jeff Gower, CEO of TRUX said in a company news release.
Trux bills itself as “the first and only comprehensive cloud-based dump truck logistics platform”
Trux bills itself as “the first and only comprehensive cloud-based dump truck logistics platform”, offering a complete dump truck management system that incorporates “automated dispatching, driver tracking, notifications, paperless ticketing and driver payment.” The company says it currently has “hundreds of the nation’s leading contractors [using] TRUX to dispatch thousands of third-party dump truck providers.”
Trux has been slowly rolling out to major metropolitan areas, recently announcing it was launching in Phoenix, following its debut in Los Angeles a few weeks prior. The company says it has launches planned in 45 additional cities this year alone.
Kitchener, Ontario-based Dozr has more than $50 million in excavators, skidsteers and drones available on its marketplace, all of which belongs to construction professionals. Dozr makes these items available for short-term rental by others in the industry.
The company raised a $1.9 million funding round back in 2016 to scale up, led by Fair Ventures. It sources quotes based on location, dates and type of equipment needed, and even provides a licensed operator if needed. This helps companies cut down on maintenance and labor costs while making better use of under-utilized equipment that’s already been bought and paid for and would otherwise be sitting unused.
“Those who become purchasers in many cases.. face issues of idle equipment and excess capacity. Being able to match the demand of users who may be unable or unwilling to purchase the high-cost equipment with the excess capacity of those who have already purchased equipment makes sense,” Fair Ventures’ Gerry McGuire told TechCrunch.
Caterpillar was an early investor in equipment rental service Yard Club, eventually acquiring the startup in 2017. The year before, Yard Club had facilitated more than $120 million in equipment transactions in North America.
Platforms like these are beneficial to both equipment owners and contractors. Owners can get better lifetime value for the investment they’ve made in their heavy machinery while hedging against the cost of maintenance and repairs. Contractors meanwhile are free to scale up (or down) the size of their fleets as needed without having to purchase an expensive piece of equipment they’ll only need temporarily. The sharing economy is taking root in a time where just about every construction company is looking for ways to do more with less.
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