The leased life  

Posted by Big Gav in

The Boston Globe has an article on the idea of leasing products rather than buying them (a topic related to cradle-to-cradle manufacturing) - The leased life.

In June 2008, when Punsri Abeywickrema was working on his backyard in San Mateo, Calif., he found himself in need of a wheelbarrow. He didn’t own one, but his neighbor did, and he had borrowed it the previous weekend; due to space constraints, he preferred not to buy one himself. Yet he hesitated to impose on the neighbor again.

He ended up renting a wheelbarrow from a store. But then he wondered, what if he had instead offered to pay his neighbor a small fee to borrow the wheelbarrow? Abeywickrema would have fulfilled his need without acquiring a cumbersome object or feeling like a freeloader. The neighbor, meanwhile, could have reaped a modest windfall. This thought led to an inspiration - wouldn’t it be great if a whole network of residents in his area could conduct similar transactions, with locals they didn’t even know yet?

Thus was born Like so many other websites, it connects mutual beneficiaries - in this case, people who own things they don’t use much with people who want to use things without owning them. Members can post either belongings they have to offer or goods they are hoping to find. Items recently listed include a body fat scale ($5 a week), a bread maker ($1.75 a day), and a cupcake transporter ($3 a week). The site was launched last October with limited membership, and opened to the public earlier this month.

Rentalic is an example of what is sometimes called (rather awkwardly) a “product service system.” The essential insight is that in many purchases, we don’t want the thing per se - we want what it can do for us. You don’t crave a lawn mower, you want shorter grass; the desire is not for a refrigerator but for cold, unspoiled milk. And according to an emerging line of thinking, there are great benefits in meeting the customer’s needs in creative ways that don’t necessarily entail ownership.

The concept has long been familiar in certain sectors - if you’ve rented a car, joined a gym, or registered at Netflix, you’ve taken part in a product service system. But now, advocates hope to expand the principle to many

other contexts where owning is currently the norm. If these systems were to catch on, we would rent, borrow, or lease a variety of things, ranging from tools to textbooks to snow blowers, from individual owners or from companies with revamped business models. Other firms, while continuing to sell their products, would address customers’ underlying needs more directly - selling warmth or “comfort services,” for instance, rather than oil or gas - which would presumably lead to enhanced efficiency. ...

The prospect of such a change is intriguing. Not only could it mean more savings and less accumulation of stuff for the relatively wealthy; for poorer people, especially in developing countries, it could mean access to goods that would be otherwise unattainable. The other major promise is environmental. Under the current ownership ethos, manufacturers face perverse incentives: If their wares last a long time, they undermine their future marketing opportunities. But if a company retains ownership itself, the argument goes, it will be motivated to make products that are truly durable - or easy to upgrade or recycle into new ones. And if a single product serves multiple users, fewer goods would need to be manufactured and ultimately discarded. All of this would mean diminished resource extraction from the earth and less trash dumped into landfills.


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