Platform to provide On-Demand ‘Labour as a Service’ | eCommerce Startup Ideas

The proposed 1001 startup idea from YoStartups is to provide ‘On-Demand Labour as a Service,’ through an online platform for access to skilled or semi-skilled professionals in hospitality, retail and other industries.

Market Definition for 1001 Startup Ideas – Platform to provide On-Demand Labour as a Service

McKinsey Global Institute reports estimate that worldwide 30 to 45 percent of the working-age population is unemployed, inactive or only part-time. It also reported that in the next ten years, online talent providers could add $2.7 trillion to the global GDP. In A PwC Survey, 46% of recruiters expected that over 20% of their workforce would be made up of freelancers and temporary workers by 2020.

There are about 600 million shifts scheduled in New York, and Toronto put together only in hospitality and Retail, and more than 6 million shifts go unfilled due to lack of skilled talent not available or unwilling to work. All these factors strongly indicate that the market for online talent providers has the potential to become a full fledge scalable business if executed correctly.

 

Competitor Analysis for 1001 Startup Ideas – Platform to provide On-Demand Labour as a Service

Hyr’s on-demand labor marketplace connects traditional businesses – starting with restaurants, hotels, and retailers – with workers to fill hourly paid shifts. The workers get paid at the end of each shift and get to choose to work where and when they want, but the real take away is that they have created benefits for the workers listed on their platform in the form of rewards which can be encashed for a full days’ paid work.

TaskRabbit, a San Francisco based startup is an online and mobile marketplace that matches freelance labor with local demand, allowing consumers to find immediate help with everyday tasks, including cleaning, moving, delivery and handyman work.

 

Pain Point and Target Audience for 1001 Startup Ideas – Platform to provide On-Demand Labour as a Service

Retailers and hospitality businesses often experience spikes in the number of people they cater to on weekends; they are often not able to plan for this surge because they don’t have on-demand access to labor as a service. The shift managers are often forced to keep regular employees on call for weekends to cater to any unplanned surges. They usually have a small reserve of workers on bench/ or on-call for this.

The employees are often left in flux because they end up waiting on weekends or any other days when they are placed on-call shifts, this causes a lot of stress as they often wait for a call, which might never come.

They can’t ignore the on-call shifts, as not turning up for a shift can cost them their jobs, this often creates a work-life imbalance as workers are not able to organize their daily schedules.

 

Value Proposition for 1001 Startup Ideas – Platform to provide On-Demand Labour as a Service

Access to on-demand labor as a service; for hospitality and retail businesses can help resource managers or shift managers to post their requirements in advance for weekends and other events when they expect surges in footfalls. This kind of planning assures them timely access to the skilled and qualified workforce; it also reduces the costs associated with managing reserve workforce and core bench strength, improving bottom-line revenues for the business.

A study of Uber drivers by economists Alan Kruger of Princeton and Jonathan Hall revealed that 51% of Uber drivers work less than 15 hours a week, to generate supplemental income. Others report working until they reach their target income. 73% of them wanted to be their boss and have a schedule of their own rather than getting tied up with a 9-5 job with some benefits.

The workers know their schedule in advance, can plan and choose their gig based on their comfort and availability. They can choose their pricing per hour and can switch off when they are not available. An on-demand global labor marketplace often opens up more locations on the map for workers, also enabling workers to get gigs across the world even while traveling.

 

Business Model for 1001 Startup Ideas – Platform to provide On-Demand Labour as a Service

The startup can build an app and a corresponding web-based platform, the platform can be used by the business to post their gigs and the hourly rate. The app can be used by the workers to post their skills, hourly rates, and schedule availability; the app will also enable the startup to tag the current location of the available workforce.

The proposed start-up can offer this platform on a SaaS-based subscription model, where it can provide a limited number of job postings on a basic plan and businesses can pay more for more job postings. The startup can work with the workforce on the platform on a fixed percent revenue sharing model for every completed transaction.

 

Way to Market for 1001 Startup Ideas – Platform to provide On-Demand Labour as a Service

The proposed start-up can build its app using the Google Map API and start running a pilot program with some of the local hospitality and retail businesses. Ideal targets would be the bars, pubs, and supermarkets which often face a surge in demand for temp workers on weekends. The start-up will have to ensure that all their efforts, in the beginning, are to onboard enough workers on their platform for the test cases to be successful. The start-up will have to ensure that the supply and demand are evenly matched.

The start-up will have to ensure that regular feedback is taken both from customers and the workers to improve the product. The start-up will have to ensure that they comply with all the local labor laws. The start-up will also have to make sure that all the workers on their platform are screened for their mentioned skill set and background checks.

 

Key Milestones for 1001 Startup Ideas – Platform to provide On-Demand Labour as a Service

The development of the app and the onboarding of the first batch of workers will have to be completed in the first two months of inception. The start-up can start onboarding the businesses from the third month of operation and start collecting their feedback for quality and improvements in the service level offerings. Once the development of the basic product is complete after rigorous testing for any bugs, lags, etc.; the startup can launch the app for local businesses in the city of operation. The process of collecting feedback and improving the product has to be continuous as the company grows.

 

Investment Needed for Prototyping for 1001 Startup Ideas – Platform to provide On-Demand Labour as a Service

The start-up can raise upto $50k from local angel investors or start-up accelerators in the city of inception. All the funds raised will be used for the development of the app, onboarding of workers and businesses. No funds will be used for payments of salaries or rents.

 

Team Capability for 1001 Startup Ideas – Platform to provide On-Demand Labour as a Service

The proposed start-up will need a mobile app developer who has full-time experience in developing apps for both iOS and Android platforms using Google Maps Api. The other desired team member can be someone working with local food delivery apps on the customer acquisition side as they can help in onboarding local businesses faster.

 

Investors/Expert Take for 1001 Startup Ideas – Platform to provide On-Demand Labour as a Service

The rise of Uber, AirBnB, Lyft have created a healthy appetite for on-demand business solutions. They are more or less trying to create a level playing field between both the service provider and the receiver.

The freelance economy is on the rise due to globalization; it helps businesses resolve hiring issues while assisting workers to get control of their work schedules, location and realization per hour of work. The companies also could free up strategic resources and focus more on core business model rather than hiring.

The market for online talent places is getting crowded, but if the startup remains focused on its niche segment and can further value-add by integrating smart algorithms for predicting demand and supply for the market, it can unleash a huge opportunity.

 

Tarun Kumar

In case you are looking at scaling or launching  a venture on similar lines, you can apply for our virtual acceleration program Excelrate on our website, Yostartups.com, Yostartups’ Excelrate program will help you in streamlining and structuring your startup idea. We have limited scholarships and discount packs for deserving startups, depending on the strength of your application, you may qualify for a discount.

YoStartups is a Pre Accelerator and it empowers entrepreneurs to propel their business ideas into successful ventures. Yostartups’ core mission is to take the message of entrepreneurship to 1 billion people globally by 2020, as on date Yostartups reaches out to over 100 million people globally through its direct and indirect channels.

 

*Any information given in the article does not constitute any warranty of marketability or fitness for a particular business idea for any market or industry segment. It is the readers’ sole responsibility to further research and assess the market opportunity.
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