Have you ever complained about products that don’t last as long as they should? Or worried about garbage generated by product packaging? Well, the business model of making goods meant to become obsolete to promote future sales may be on the way out. And some companies now reuse their own or others’ leftover materials in novel ways.
While the global trash heap has been growing, a new idea — and practice — has taken hold: running waste-free businesses, where used products and packaging are plowed back into the production of new ones. It’s called the circular economy.
Why circular?
The Industrial Revolution created a linear model of quick, efficient product manufacture — increasingly with built-in deterioration dates — without regard to environmental consequences. Historically, manufacturers have taken often-unsustainable resources, made stuff and disposed of what’s left in ways that harm the environment.
But in a circular economy, manufacturers use sustainable resources to make long-lasting products that may be refurbished, reused or recycled to manufacture new products in-house or sold to other manufacturers to repurpose. Waste products become sources of renewable energy. It is circular because businesses “close the loop” — they conserve resources from start to finish.
Why disruptive?
Participating in the circular economy is “disruptive,” because it means doing business in new ways.
For manufacturers, it means embracing environmental standards that might have been dismissed earlier unless forced upon a company by government regulation.
For the service sector, it means inventing new companies that reduce waste. For example, companies may make and then lease refrigerators or washing machines directly to individuals, and maintain and replace the equipment as part of the agreement. (This already happens in the peer-to-peer “sharing economy,” where ZipCars and Getaround offer short-term car rentals and Spinlister lets people rent bikes to their neighbors.)
Businesses can find help as they retool. Cradle to Cradle Products Innovation Institute trains manufacturers to monetize environmental practices and materials. The institute certifies hand soap, cosmetics, household cleaning supplies, fabrics and building construction materials as environmentally sound.
Going beyond recycling
Lighting manufacturer Phillips is consciously transitioning to a circular model. Its pilot program includes pay-for-use — instead of purchased — MRI machines for hospitals. The company also maintains, refurbishes and reuses its own products.
Energizer makes new batteries from old for its EcoAdvanced line. “By creating the market for the recycled materials, it decreases the need to mine new materials … a big contributor to greenhouse gas,” said Scott Cassel, of Cradle to Cradle Products Innovation Institute.
Furniture maker Ikea, food industry leader Coca-Cola, and tech giants Google, Cisco Systems, Hewlett-Packard and Dell are among companies going circular. Governments in Belgium, Denmark, Scotland and Taiwan, among others, are showing interest too.
Clothing manufacturers H&M and Speedo use recycled fabrics in their garments. Fabric maker Aquafil partnered with Speedo to create a superior “upcycled” synthetic fabric for reuse from the swimwear company’s own remnants.
And for fashionistas who want to wear a different outfit every day, there are even firms, such as Runway Rentals, that will rent haute couture … and keep it circulating.
