Circular economy: An economic upturn for companies!
Defined as a socio-economic management model aiming at producing durable goods and services while reducing waste and dampening the correlated decline in resources, a circular economy is a refounded response to the urgency of transitioning to greener means of consumption.
If both the concept and definition may appear constraining to companies, a circular economy is no short of promising, in reality! What is it and how can it effectively benefit companies?
A circular economy: better cost management and increased competitiveness
In the linear economy model prevailing today, the necessary resources are extracted, goods are manufactured, sold to be consumed afterward, and finally discarded. This state of things not only causes raw material to diminish and waste to pile up, inevitably participating in the fast degradation of the environment, but also adds to the crushing pressure that industries most concerned by the issue fear.
When opting for a circular economy model, enterprises can, with today’s ever-increasing shortage of resources, corresponding inflation in supply costs, and extra waste-management expenses, have greater control over the management of costs. But how so?
How can a circular economy model benefit companies?
The number one goal of a circular economy model is to reshape today’s damaging and exponentially expensive production pattern to avoid throwing away invaluable resources whenever possible by reusing them for as long as feasible. To reach that objective, production cycles are to be rethought to fit three distinctive points:
1. Eliminating as much potential waste upon manufacturing;
2. Reusing production materials;
3. Actively safeguarding the natural system.
By choosing this particular production model, companies not only mitigate the costs incurred in manufacturing goods and services but moreover largely contribute to lowering their impact on the ecosystem. A win-win strategy, as, with production and management costs shrinking, enterprises become more competitive and better sustain themselves in the long run.
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Now a concerted global strategy, this green economy transition has seen a considerable rise in all sorts of governmental and non-governmental financial support initiatives, such as TonToTon‘s plastic credits system.
Gaining access to new markets with a circular economy model
One of the supporting pillars of a circular economy model is extended cooperation between different production sectors. This restructuring of inter-production business relations solidifies professional networking.
Therefore, for companies to turn to a circular economy model is synonymous with developing new markets. As such, innovation is a recipe for catering to new customers. Building new business relations with like-minded contributors is, too, a great way to secure long-lasting benefits.
A circular economy production model: staying ahead of competitors
By setting up a strategy that is determined to embrace this renewed business model, companies are already miles ahead of competitors that have not or are only now thinking of transitioning from a linear to a circular economy model. Enterprises that first set the stage for precursing innovation, bound to attract increasing numbers of competitors with similar interests, will have already secured their position in the market.
Moreover, with ever-changing environmental norms, enterprises that have already foreseen said changes and seized the opportunity to plan are well shielded from the many uncertainties that plague emerging technologies and transitioning economies.
A circular economy model calls for constant innovation
Regardless of the service offered, for a company to confirm its leadership position, efforts directed at taking into account, within an eco-design framework, the lifecycle of its line of products and the sustainability of the services marketed must be made.
Solidifying such a business model within circular economy dynamics forces enterprises to redouble their efforts to enhance their services and offer better-quality products to consumers. Promoting reusability and waste management, with the end goal being to aim for quality rather than quantity, is a key component of a viable transition.
A circular economy model boosts job creation
Perhaps the largest pillar carrying the circular economy model is recycling, as the core idea at the heart of this economic system is waste reduction. As opposed to the long-prevailing management method, which, more often than not, meant shipping away excess waste to be buried away, recycling not only requires substantially more manpower but it moreover enables countries to treat waste within their own borders.
Therefore, companies that follow suit and adopt a circular economy model when handling their production partake, while creating local jobs, in reducing their overall carbon footprint.
A circular economy model ensures a better brand reputation
You will have understood that, beyond simply allowing companies to save money on production costs, a circular economy business model largely contributes to:
. Stimulating the job market nationally;
. Propelling companies to secure more stable earnings;
. Reducing the hyper-exploitation of natural resources;
. Dampening environmental harm.
Moreover, companies can hope for an even more valuable benefit: the improvement of their brand image. Once acquired, the reputation of a business not only generates increasing trust from its target customer base but solidly paves the way for more responsible ways of consuming.
