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How Companies Can Benefit from the Circular Economy

The circular economy represents a viable alternative to this detrimental “linear” model. Rather than going from “cradle to grave,” this new development pathway promotes ‘cradle to cradle‘. 

In this type of economy, company growth is no longer reliant on the use of scarce resources.

Instead, it is achieved through the use of disruptive technology and business models that are based on longevity, renewability, reuse, repair, upgrade, refurbishment, capacity sharing, and dematerialization.

Circular economy thus requires companies to step away from focusing only on driving more volume and cutting costs through greater efficiency in operations and supply chains. Instead, companies should focus on rethinking products and services from the bottom up to “future proof” their operations, all the way to customer propositions. Don’t wait, let’s go circular !

We can extremely reduce our energy consumption by producing fewer resources and mining. This can be done by reusing materials, and by prolonging the life of products.

After the climate agreement in Paris, one thing has become clear: we need to reduce CO₂ emissions. To achieve this, we should save energy and reduce the extraction of raw materials. For instance by reusing products and extent the service life.

If we dig and consume fewer resources, we will achieve enormous energy savings. Moreover, the value of the raw materials will maintain. This trend is part of the emerging circular economy.

Exhausted earth

In the Netherlands, there is a huge movement towards a circular economy.

Consumers organizations are experimenting with new business models

  • In business environments (B2B)
  • from business to consumer (B2C)
  • and consumer to consumer (C2C)
  • and even consumers who serve the enterprise market (C2B)

Why? Communities are convinced of the need for a circular economy because of the increasing scarcity of raw materials. The world is consuming so much resources and energy that our planet is exhausted. The word needs to transform from linear to circular.

Thomas Rau, founder of Turntoo and RAU Architects launched an initiative for the Universal Declaration of Material Rights as a contribution to codify circular economy principles on a global level. Please watch the video below.

More exciting examples of circular business models

  • Peerby: Rent stuff from people in your neighborhood, is a great initiative to prevent people from buying and trowing stuff away to early
  • Or shareyourmeal where people cook and share meals.
This new initiatives, fit perfect into the circular economy. In 2016, the new question is ‘How much electronics did you reused the last year?’ And … ‘How much energy you did you save?’ In the circular economy, it’s not only about extending the lifecycle of products. It’s more.

7 principles of the new economy

  • Maximize value preservation by first examen product reuse possibilities. Then focus on reuse of spare parts and finally the recycling of raw materials
  • Designing and manufacturing products in a way that they can are easily be disassembled
  • Avoid emitting toxic stuff during the production process
  • Try to reuse components in a new product. Not only for technical products. Reused organic streams perfectly fit for road signs
  • The raw materials of “consumables” are biodegradable and will return to nature at the end of the live cycle. Technical raw materials should be re-used
  • From possessing to using. Producers retain ownership of the raw materials and products. Customers pay for the use. Or the manufacturer purchase the product again at the end of the service life.
  • A circular economy is only possible by working together in a multiple value chain. Collaboration saves money, ecological and social values.

9 R advantages for entrepreneurs

The value chain can be simplified by the 9 R’s: Refuse, Reduce, ReUse, Repair, Refurbish, Remanufacture, Re-purpose, Recycle en Recover.

The circular economy offers many opportunities for entrepreneurs: more collaboration, innovation, less resource consumption and less waste. Start now. The move to a circular economy, challenges are changing in your processes and a different focus.

SlideShare about the financial impact of circular business models.

Related

 

Have you seen this

Circular economy: cheaper resources, more jobs (dossier)

Inspiring green, circular architecture (dossier)

Industries: models for decision makers (dossier)

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