We know our economy is changing. Gone are the days when most people graduated high school or college, got a job with an established company, and worked there for many years until they retired with a comfortable pension. In the 21st century, student debt is high, job security is scarce and retirement benefits are low. As a result, many of us have turned to the gig economy. In fact, by 2027, in less than ten years, the majority of the American workforce will be contracted.
What is the gig economy?
Picture a group of musicians traveling from city to city, performing, and then moving on to the next opportunity. Instead of working 9-5 Monday through Friday in an office and getting paid every two weeks, these artists move from gig to gig. Now picture an economy built around gigs, not around regimented office or factory work. It’s an entrepreneur renting out rooms for Airbnb, or a business owner who leases cars on Turo. That’s the gig economy.
However, there are pitfalls and obstacles in the new gig economy I’d like to help you avoid. Ten years ago, it was much easier to enter the gig economy because many of the platforms and websites entrepreneurs could use to make money were new and there was far less competition. For example, Uber was new, Etsy had promotion tools that drove traffic to your website and you didn’t need to be a super host to get bookings on Airbnb. Now, with increasing numbers of people joining the gig economy, the rules are changing and smart entrepreneurs need to adapt in order to succeed.
One of the best ways to adapt is to do something better and smarter than your competitors. Look for a platform or service where you can keep initial startup costs low, with enough demand to rent or sell to new tenants or customers. Instead of buying a house to rent to travelers on Airbnb, find a house in a somewhat in demand city and rent it, then re-rent it to other people. You’ll recoup your initial investment and make more money long term. Another good real estate strategy is to buy foreclosed properties from local governments or banks and sell or rent them to potential buyers or tenants. The sellers want them off the market quickly and are willing to part with the properties for relatively low prices, much lower than they’re otherwise worth. You can buy in inexpensively and sell them for a higher price.
Real estate is not the only industry where strategy, research and planning can pay off. Find a service that uses your resources, not your time. For example, Uber and Turo are both popular ride-sharing services. However, with Uber you have to provide your own vehicle and pick up and drop off customers. You might spend hours a day driving and have to compete for fares from other Uber drivers, Lyft drivers and traditional cab companies. By contrast, Turo allows you to rent out your vehicle to other drivers. Buy as many cars as you want and let other drivers pick up customers, while you collect the fee.
When it comes to staying ahead of the competition, technology is your friend. Know how to employ technology and software to shrink the amount of time you spend on a particular activity and save money. Find an app or software program that saves you time. If you own a small business or are self-employed, use an accounting software program like QuickBooks to quickly, easily calculate payroll, taxes and employee deductions. It’s also cheaper than hiring an accountant.
Another smart way to make use of your resources is to offer online educational courses or workshops. Knowledge and education are never going out of style, by contrast, educational courses are more sought after than ever. If you have a skill or experience you’d like to share, create a course. Technology makes it easier than ever, and it’s a great way to leverage your resources rather than time. Instead of teaching an eight-week classroom course, create content on Evergreen, where you provide the content, someone else prerecords the webinar and it creates revenue for you without ever setting foot in a physical classroom. Evergreen even advertises the webinars on sites such as Google and Facebook.
YouTube tutorials are another popular educational tool. I’ve lost track of the number of time I’ve searched sites such as YouTube to find how to videos. In addition, when it comes to education, find a topic that will stay relevant for a long period of time. Topics such as “How to soothe a crying baby” or “How to get grape juice stains out of your clothes” will have a much longer shelf life than “The Top Ten Fashion Trends for 2018.”
Finally, when it comes to building your gig economy business, you need to find the right people to work with you. Employees whose vision and goals align with your own make the best team members. Weed out employees who treat what they do as a 9 to 5 job. Instead, find people with the same passion for your business as you have. For example, if you’re in the tax lien business, promote the employee who does research on their own and then comes to you with their findings. You’ll not only gain a loyal team member; his or her hard work and dedication will benefit both of you.
Smart entrepreneurs can use resources, strategies, technology and human capital to survive and thrive in the new 21st century gig economy. By leveraging your resources rather than time, and making sound strategic investments, you can stay ahead of the competition and continue to succeed in an ever changing and competitive economic environment in 2019 and beyond.
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