Sustainability is one of the leading concerns for businesses across all industries today. Companies can take many small, separate steps to become more sustainable, but meaningful change requires broader, more comprehensive action. Many climate experts have promoted the idea of a circular economy as an ideal solution.
A circular economy aims to eliminate waste, abandoning the linear progression of materials to products to a cycle. Instead of reaching an end of their life or usefulness, products transfer back into raw materials to start the cycle anew. Some businesses have already implemented circular economies, but the practice must grow for the industrial world to fight climate change effectively.
Here are five ways that businesses can help implement and expand the circular economy:
- Technology-Driven Insights
One of the most significant obstacles the circular economy faces is a lack of visibility. If organizations don’t know where their waste comes from, they can’t eliminate it. Similarly, if a manufacturer sources from a wasteful supplier, they can’t truly claim a circular economy. Insights from technology can help.
Internet of things (IoT) networks and data analytics engines can give companies more visibility over their operations. They can then see where waste arises and how they could adjust their operations to eliminate it. Requiring similar insights from all partners will help them ensure they don’t rely on third parties that don’t have similarly cyclical economies.
- Additive Manufacturing
Recycling is a major component of the circular economy, but it’s insufficient on its own. The U.S. recycled nearly 70 million tons of solid waste in 2018, but it was far from green. To reach a circular economy, industrial systems must produce less waste in the first place, and additive manufacturing provides a way.
Since techniques like machining generate waste by design, the industry must move away from them to create a circular economy. Additive manufacturing, also called 3D printing, adds material instead of cutting it away. Relying on these techniques instead of traditional methods reduces waste in production by only using what resources manufacturers need.
- Securing the Supply Chain
Many circular economy initiatives focus on sourcing and production, but the stages in between matter too. An inefficient or insecure supply chain can hinder the efficacy of other strategies. For example, improper transport of chilled foods can lead to microbial contamination, wasting these goods even if the rest of the cycle isn’t wasteful.
Supply chain security must improve to reduce these accidents and keep circular economies waste-free. IoT tracking devices can help ensure shipments travel safely, and dynamic routing systems can alter delivery schedules in an unexpected event, like a refrigerated container breaking. In that case, a sensor can alert shipping companies to the damaged item, ensuring the container is sent back in a reasonable time frame and can be replaced without major interruptions to the supply chain.
- As-a-Service Business Models
Many business models today are incompatible with the circular economy because they’re wasteful by design. As-a-service models fit better into a circular economy because they use resources more efficiently. In these models, customers reduce waste by using only what they need. Producers reduce waste via the benefit of lower output requirements since one product can serve multiple customers.
In commercial markets, as-a-service business models reduce the resources and equipment facilities need on-site. They can then move to smaller spaces with a smaller ecological footprint. In agriculture, some companies have taken advantage of software to adjust the amount of fertilizer and water used for crops.
- Promoting Economic Benefits
Business today is intermingled, with virtually every company relying on multiple third-party dependencies. As such, the circular economy must see widespread adoption for it to be truly effective. Organizations can promote further adoption by promoting its economic benefits.
Research suggests that the circular economy could create a $4.5 trillion economic opportunity by reducing waste and creating jobs. Communicating these benefits to stakeholders, partner companies and other industry leaders will promote the circular economy. As a result, adoption of this practice will grow, unlocking its full potential.
A Circular Economy Is Possible
Moving to a circular economy will likely cause significant disruption upfront. While it seems like a challenging process, a circular economy is possible, and the industrial world should start pursuing it today. These five strategies can help it grow, pushing companies towards a more sustainable future.
About the author
Jane Marsh covers topics in green technology and manufacturing. She also works as the Editor-in-Chief of Environment.co.