Twist & Turn. Your Circular Business Model needs a Push

Decades ago, when the Circular Economy concept was on the discussion table, attention was gathered.

Many were skeptical.

Many said it is impossible.

Many decided to wait and see.

The growing global phenomenon around Circular Economy proved that It is not impossible. In fact, transferring to Circular Economy is the way to ensure a prosperous economy in line with societal sustainable development goals and the Earth's limits. Many countries released their National Circular Economy Roadmap. For example, Finland has done it since 2016, while others are working hard to create their pathway.

So what does this mean?

It means that businesses can wait no more. They need to act now and hurry up.

Now, it is no longer the Why but rather the How.

Let's recall some of the worth-noting points before any further detail on How.

Circular Economy's Principles

• Eliminating waste and pollution: by design, we stop waste before it is even created.

• Circulating products and materials.

• Regenerative nature

Circular Economy's Building Block

• Circular design: product design & process design

• New, innovative business models to replace the existing ones and seize new opportunities.

• Reverse cycle: return of materials to nature or back into the industrial production system.

• Enablers and favorable system conditions: new and revised market mechanisms can encourage the widespread reuse of material and higher resource productivity.

Loops

• Closed loop: refer to products or materials retained or recovered for use again by the same company, like water treatment and use again in the company.

• Open loop, same sector: refer to products or materials retained or recovered for use again by different companies but in the same industry.

• Open loop, cross-sector: refer to products or materials retained or recovered for use again by companies in cross-sector

How to make a twist on your business model?

• The model for circularity should be "collaborative consumption," " servitization," and "product service system" instead of selling in the traditional way.

• Share: share of access or share of ownership. In some cases, when the sharing people do not know each other, it could be considered an "access economy"

• Exchange: at the end of the first use cycle, ownership of the product is transferred between entities.

• Rent or lease: rent assent for a fee

• Service, performance, or results: extend the rental model by including the concept of "buying performance" or rent it out to ensure that its materials are returned for reuse.

Worth-noting points:

• Eventually, we need to shift our minds from product to solution. This applies to both companies and customers.

• Moving to solution-based models might require long-term effort and a greater level of cross-sector collaboration and customer engagement.

Reference

1. The Circular Economy handbook, Jessica Long, Peter Lacy, and Wesley Spindler, 2019

2. Stockholm resilience center, https://www.stockholmresilience.org/research/planetary-boundaries/the-nine-planetary-boundaries

3. A global roadmap for an inclusive circular economy, https://circulareconomy.earth/publications/a-global-roadmap-for-an-inclusive-circular-economy