Circular Business Models

Circular inputs focus on using sustainable, reusable, or renewable materials in production. Rather than relying on limited new raw materials, companies use recyclable, recycled, renewable, or biodegradable materials. This promotes a closed-loop economy, where materials are reused without losing their value. Using circular inputs reduces companies' dependence on scarce primary raw materials and greenhouse gas emissions. Customers benefit from sustainably produced products with a low environmental impact.

When products cannot be reused, remanufactured, or dismantled, recycling provides one final opportunity to make use of them at the end of their life cycle. The goal of resource recovery is to extract valuable materials from end-of-life products or production waste and return them to the value chain. Rather than disposing of raw materials, they are reused through recycling, upcycling, or special take-back programs. In industrial symbiosis, unused materials are not revalued through recycling; rather, the waste product of one process can be used as is as an input for a new product. Companies obtain waste from the byproducts of their production processes and pass it on to cooperating companies, which use it in their own processes.

The goal of extending the life cycle is to increase the value of products through maintenance, repair, renewal, or recycling. Rather than disposing of products after a single use, companies are focusing on durable designs, modular product construction, and direct product reuse, among other strategies. These measures reduce the need for new raw materials, cut down on waste, and decrease greenhouse gas emissions. Companies benefit from new sources of income while customers receive durable, sustainable products.

Product service systems (PSS) are characterized by the fact that the company retains ownership of a physical product and offers it for rent or lease on a service basis. The company is responsible for maintaining and refurbishing the products, which are regularly serviced and repaired. At the end of their life cycle, the products are reused or recycled. This approach extends product life, makes more efficient use of resources, and minimizes waste. Companies benefit from more stable sources of income, and customers gain flexible access to high-quality products.

Collaboration platforms aim to facilitate the intensive or frequent use of goods owned by individuals or companies by enabling shared access or ownership. The goal is to extend the life of rarely used products by sharing them more frequently. These platforms facilitate transactions involving the temporary transfer of ownership between companies and consumers. Using collaboration platforms can reduce the need for new products to be manufactured, thereby reducing material and energy consumption. Companies benefit from lower costs and new revenue models, and customers gain access to high-quality products that are often expensive.