The Business Benefits of Circular
Photo by Unsplash @LaceyWilliams
Though circular business models are still in their infancy, they have tremendous potential for increasing efficiency and profitability while accelerating the transition to low-carbon products and services.
Some of the growing range of business benefits include:
Revenue Growth and Brand Enhancement:
Expand Sustainable Product Lines: Recent Nielsen research clearly demonstrates sustainable products (from sustainable purpose driven companies) are significantly outperforming conventional products, with younger consumers at the forefront
New Customer Growth by capturing secondary and alternative markets through repair and remanufacturing channels
Enhanced Brand Loyalty by delighting customers with enhanced products and packaging designed for long term re-use
Brand Engagement through Product as a Service models: Enabled by digital disruption and the sharing (reuse) economy, research continues to show that younger generations value experiences and relationships over product ownership. In addition, corporations are now exploring procurement of technology and other infrastructure (e.g. office furniture) leveraging product use over ownership.
Cost Savings
Lower cost of production through the more productive capture of recycled materials, more efficient use of inputs, and finding value from use of byproducts
Reduce costs of waste management through design for reuse or elimination of unnecessary packaging
Regulatory Cost Avoidance
Reduce carbon price exposure by reducing carbon footprint of products through extended use cycles and/or use of recycled materials
Minimize end-of-life product costs (extended producer responsibility), anticipated to increase due to increased pressure on municipalities for landfill and recycling cost reduction
Supply Risk Management
Companies decreasing their use of raw materials will thrive in a resource-constrained future
Minimize global supply chain disruptions from international trade disputes by sourcing locally recovered materials