“Waste to Wealth” is a book by Peter Lacy and Jakob Rutqvist exploring the business case for a circular economy.
Specific to the ownership challenge, my main takeaways are:
- The power to make the shift from a linear model to a circular one lies on the demand side. Companies need to deep understand consumers.
- The book mentions 5 circular business models: Circular supply- chain, Recovery & recycling, Product life-extension, Sharing platform, Product as a service.
- Digital technologies are enablers to pooling products for co-use and co-ownership, however companies yet need to demonstrate how changing ownership for access translates into greater convenience, less clutter and financial benefits.
- Companies need to understand that in this format, consumers are not paying for the energy and resources to produce a product, but paying for the actual service this product can deliver. Hence, we actually might be looking into “redesign” products and services instead of just making products available in a different model.
- The elimination of wasted capacity through any forms of resource pooling has an economic growth potential of $0.6 trillion by 2030. The authors see this market as the one with strongest growth potential within the linear economy waste.
- “Product as a Service” business model offers a high potential to be blended with other circular business models, such as “recovery and recycling” and “sharing platforms”.
- Policy is also very important. Circular economy provides a way of long-term resource stewardship and short-term business benefits, but this cannot be materialised if policymakers does not ensure that what is best for our people an planet, is also the best for profit bottom line.