Could circular economy principles help your business?

No doubt you have heard of the circular economy, but what does a circular economy mean?

It is defined by the Ellen MacArthur Foundation as an economy ‘based on the principles of designing out waste and pollution, keeping products and materials in use, and regenerating natural systems’.

This is much more than eliminating single use plastic, avoiding ‘fast’ fashion resulting in clothes going to landfill and reducing your carbon footprint, circular principles bring new thinking to business models and customer behaviour.

The industrial revolution, the discovery of fossil fuels for power, chemical fertilisers to increase crop yields and advancing technology have enabled people to have high levels of material comfort and the population to grow. Raw materials seemed infinite so were not valued. Resources taken from the ground to make products are used and when no longer wanted are thrown away. ‘Take-make-waste’ is a linear economy model and until the mid 20^th century was considered sustainable. Due to population growth the pressure on the natural world is no longer seen as sustainable and there is growing public, and therefore consumer, awareness of climate change, natural diversity loss and waste going to landfill so governments and businesses are reacting.

Circular economy principles to design out waste and pollution from processes, keep products and materials in use, and regenerate natural systems are being applied in diverse industries with positive results for marketing and profits. 

The jewellery industry buys and recycles precious metals and stones and has effective waste reduction processes because of the materials’ value. Processes are established to supply reliable information for purchasers on the origin of raw materials to avoid supporting bad mining practices which cause pollution or social problems. Customers see purchases as long-term investments which can be remodelled or ‘returned’ by selling as second hand or scrap.

Other industries whose raw materials have been less valued are following this lead, for example:

• Products marketed as being made in part or whole from recycled fabrics, plastics or ceramic are growing in popularity especially at the higher price points and commanding higher prices.
• Reuse of plastic bottles is made more effective by designing all bottles in a range to be the same shape so that they can be cleaned and relabelled for refilling, which is more efficient than recycling as they remain in use. They are collected in reverse vending machines which give refunds or tokens.
• Farming practices for food and textiles are going beyond organic to avoid monocultures and regenerate natural soil systems, water courses and habitats.
• BTAA member Shona Easton designs small items using the offcuts from leather and fabric handbags saving waste and generating sales.
• Fast fashion retailers reduce waste with smaller product runs to avoid excess stock being sent to landfill or sold at a discount, so increasing profit.
• Designing products to be modular so that parts which fail or can be upgraded are easily swapped is a circular concept being adopted in a variety of industries. One brand of headphones have designed their products to be modular and customers rent rather than buy them. Upgrades or repairs are achieved by returning them for replacement and parts can be refurbished and reused or exchanged for upgraded versions. The motor industry is refurbishing used engine parts which are then indistinguishable from new ones.
• Alternatives to petroleum-based plastic derived from abundant biomaterials, including unavoidable food waste, are becoming more widely available, particularly for packaging.
• The government plans to bring in ‘right to repair’ legislation this summer to keep domestic electrical goods in use longer. This principle is likely to be applied to other products in future.

The Ellen MacArthur Foundation is an international charity working to research, publicise and support the circular economy. You can see more examples on the website https://www.ellenmacarthurfoundation.org/circular-economy/what-is-the-circular-economy