UBER: Car Sharing Business Case Study
Most businesses that adopt the “sharing economy” approach are often welcomed with mixed reactions, and Uber is no exception. The sharing economy is a system where private individuals enjoy assets, products, or services for a set fee or even for free.
The system allows interested users of the commodities to access it mainly via the internet. This makes it easier for individuals nearby and those far away to access the system quickly. Uber adopts this system to introduce a much-needed innovation to the transport industry that will make people’s lives easier.
The technology company pursues this objective through its mobile phone application and website. Individuals who wish to request a ride can easily do so by logging into their account on the application or website and providing details of their destinations. The systems automatically search for available drivers in the vicinity and then connect the passenger with anyone who accepts the offer.
The system lets the driver notify passengers about their arrival by hitting the ‘Arriving now’ tab, automatically sending a text message. The tech company can track a passenger’s GPS coordinates to help the driver meet up with them without any difficulties. This is especially important for drivers not conversant with the location of places within a particular city.
Interestingly, the application allows passengers to track the estimated time before their ride’s arrival and how long the entire drive will take. There is usually no need for cash as the application requires prospective passengers to provide details of their credit card when signing up for an Uber account.
Passengers are charged electronically, and receipts are emailed immediately after being alighted. Uber application also provides a rating system where passenger and drivers can rate their experience after the ride. This helps the company to discontinue the services of poorly rated drivers. The popularity, acceptance, and success of Uber since its inception is attributable to its sharing economy system.
Uber’s innovation in the transport industry also includes working with drivers deemed independent contractors. The tech company does not issue licenses or employ these drivers. Individuals who fulfill the company’s requirements may sign up to drive and, if approved, be allowed to work independently.
Uber believes this system will help create an efficient, simple, and more comfortable experience for passengers and drivers. With its sharing economy system, the company has been able to cater to an easily accessible on-demand driving service in luxurious vehicles.
However, As already stated above, the success of Uber has attracted a mixed reaction from the populace, especially the government. Organizations and individuals who go against Uber’s sharing economy argue that the system is just another way to evade taxes and legal obligations and disregard key regulations.
For instance, uber pays less tax than expected, which is deducted from the company’s 20 percent share of the fares paid by passengers. There are also concerns about drivers working overtime to fulfill their financial requirements. This leads to working more extended periods, which may harm drivers and passengers.
Uber’s in-person in the transport industry has also reduced productivity and income for traditional taxis.
