The sharing economy has changed everything, and these 10 companies are at risk

The rise of the sharing economy has fundamentally changed the business landscape, and some companies are going to have to adapt to survive.

Business Insider last week compiled a list of the biggest winners in the booming sharing economy, based on a report published by Credit Suisse report Friday.

The 10 companies listed below are those that could lose out.

Carried by shifting consumer preferences for lower cost and eco-friendly alternatives, the sharing economy is likely to grow from $US15 billion in 2013 to $US335 billion by 2025, according to PWC.

And it’s here to stay, according to the Credit Suisse note. Almost seven in ten adults in developed and emerging markets say they are willing to participate in the sharing economy, according to an AC Nielsen survey of 30,000 people cited in the note.

Even traditional companies such as Hyatt, Target, and Walgreens, are treating sharing companies as serious competition — or opportunities.

The likes of BMW, IKEA and Tesla have also jumped on board the sharing economy by establishing collaborations with existing sharing sector companies.

Volkswagen

Newspress

Rating: UNDERPERFORM

Market Cap: $US89.7 billion

About: Volkswagen sales are likely to drop if the sharing economy expands.

That's being driven by a change in consumer preferences. Car sharing services are seen as a cheaper and more eco-friendly alternative to private car ownership. Credit Suisse noted that using Zipcar rather than the VW-Golf adds up to roughly $US555 in monthly savings.

The German car maker is in the news at the moment for allegedly using hidden software to cheat clean-air standards during testing.

Direct Line Group

Direct Line

Rating: NEUTRAL

Market Cap: $US7.67 billion

About: Direct Line is an insurance group based in the UK that sells home, pet, travel, life insurance and more through subsidiaries around the world.

The company is likely to be negatively impacted by the sharing economy as private car ownership falls in favour or car sharing services.

By extension, Direct Line, which offers local insurance services in several countries, will become less popular, since their business hinges on private car ownership.

Admiral

ADMIRAL

Rating: NEUTRAL

Market Cap: $US7.61 billion

About: An insurance company based in the UK, Admiral is expected to face disruption from the expanding sharing economy.

Insurance services like Admiral, which provide local coverage rather than international, are likely be fall behind as expanding car sharing companies seek global coverage for their fleets.

Hyatt Hotels

TripAdvisor

Rating: UNDERPERFORM

Market Cap: $US7.42 billion

About: Airbnb could have 59 million annual bookings by 2020, according to Credit Suisse estimates. That is likely to hurt traditional hotels, such as Hyatt.

Hyatt is responding by establishing agreements with sharing companies, and investing some $US40 million in a British luxury home-share company called Onefinestay.

The hotel giant started a pilot program with Onefinestay in July, allowing renters who arrive at check-in early to store their bags and freshen up at the Hyatt Regency London - The Churchill.

'It will be interesting to see if further investments from hotel operators are forthcoming as a method of embracing the segment's growth potential,' Credit Suisse said.

Berendsen

Berendsen

Rating: NEUTRAL

Market Cap: $US2.66 billion

About: UK-based Berendsen provides laundering services and rental linens to hotels and hospitals, and is likely to see a dip in demand from hotels if the sharing economy grows as cheaper and more social home-sharing options such as AirBnB continue to gain popularity.

Royal Mail

RoyalMailStamps via YouTube

Rating: UNDERPERFORM

Market Cap: $US7.2 billion

About: A UK based packaging and delivery service, the Royal Mail is likely to see more pressure in the aftermath of Amazon's expansion in to the delivery business and pre-owned sales area.

'We estimate that the Amazon entry has capped Royal Mail's addressable market growth rate to 1-2% from c4%, a trend which RMG expects to last two years,' Credit Suisse said.

'In the medium term, the likes of UberRUSH, whilst still clearly in the early stages of development, highlight where further entry could stem from if parcels margins start to improve in the UK. This is effectively capping how profitable the sector is likely to ever be.'

Michael Page

Rating: UNDERPERFORM

Market Cap: $US2.45 billion

About: UK-based recruiting platform Michael Page connects select employers with potential recruits through a middleman.

The recruitment sector of the sharing economy -- which now includes LinkedIn and other freelance websites that allow direct staffing without a third person -- allows users to cut out that middleman, potentially hurting the likes of Michael Page.

'While currently acting as another route to market for the agencies, and therefore more of a help than a hindrance, the (recruitment sharing) services will take incremental permanent volumes (via direct sourcing) from the agencies and potentially put pressure on margins given their growing pricing power for licences,' Credit Suisse says.

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