We start businesses so that we could sustain our needs for the present. Our families have a good home and enough resources to stay healthy and happy. But we build sustainable businesses to prepare for the future. It’s so that we can afford to send our kids to a prestigious college of their choice. It’s so that when we retire, we can do so without having to worry about working.
What we want is a sustainable business. We want a business that can easily adapt to the changing times. It’s driven by technology and able to compete with other modern companies. It uses automation and software to improve productivity. It improves customer service by using SaaS onboarding technology. It uses digital marketing strategies to establish a strong online presence so that, in turn, it has a broadened customer reach. It interacts with customers through engaging written and video content on websites and social media platforms.
But how can our businesses achieve this level of sustainability and success? Well, you can do it through the circular economy.
What Is Circular Economy
Circular economy is a concept that’s been in development in the last few decades. It’s inspired by people’s growing concern over the environment. We’ve been straining its resources through fossil fuel. Our factories have been letting out high levels of carbon emissions into the atmosphere. We’ve been cutting down trees and contaminating oceans. We’ve been producing waste that we don’t know how to get rid of properly.
Economists, then, started thinking about the idea of waste. They theorized that waste doesn’t have to be forever useless. They thought that if we don’t eliminate our tendency to generate waste, we can turn that waste into something profitable. Thus, they created the circular economy. Its businesses operate circularly rather than linearly.
They came up with solutions that help businesses with becoming more efficient with their use of resources. They found ways to save money and create a culture where the earth’s resources are not taken advantage of. They envisioned an economy where nothing goes to waste.
These all seem vague right now. But to help you envision a future in the circular economy, here are the five models that your business can follow. These models pave the way for your business’s successful and sustainable future.
Circular Supply Chain
This business model encourages you to use renewable, recyclable, or biodegradable resources. It minimizes (or even eliminate) your waste from the get-go. This way, you also get to reduce your costs for materials. A company that does this is AkzoNobel. It’s a company producing paint and coatings. They developed a technology where they use solar energy to create bio-based chemicals used in paint and other products.
Recovery and Recycling
It’s good that you already practice recycling in your daily life. But this sustainable practice is beyond using tumblers instead of disposable coffee cups. This business model creates businesses that recycle waste to create something new and usable. A company that does this is Walt Disney World Resort. The company recovers food waste from its restaurants and hotels and then brings them to a facility. This facility converts this waste into renewable biogas to power up the electricity.
We all have a junk drawer or cabinet at home. It’s filled with dead gadgets that were beloved before they became unusable. But through this business model, you can find a better use for that iPod or Blackberry that nobody uses anymore. Somewhat similar to Recovery and Recycling, companies can reclaim these old products. Then they would repair or upgrade them so that they can be used again.
You might not be familiar with the term. But you’ve definitely been a customer to businesses that have this model. It urges customers to rent, share, or even exchange goods and services. It’s popular in transportation through Uber and Lyft, and lodging through Airbnb. In this way, companies get to reduce their costs.
Product as a Service
Imagine if your fridge or cars are borrowed from companies. It seems odd, right? What are we paying them for if we don’t own these things? Through this business model, customers pay for the time they’re going to use the product. It’s just like renting a home. A company that does this is Michelin. Customers “rent” tires for their cars, paying for the company based on the miles driven.
To have a business that’s equipped for the future, you must know how to adapt to a circular economy. It brings to life our visions of the future–one that preserves the earth’s resources, keeps people safe and sound, and keeps businesses thriving.