Top Five Circular Economy Trends for Business
[Editor's Note: UPS will be speaking at our 2017 Sustainability and Circular Economy Summit on June 26-28 in Washington, D.C. Chief Sustainability Officer, Tamara Barker, will be speaking on Disruptive Enabling Technologies, and Director of Global Sustainability, Patrick Browne, will be speaking on advances in reverse logistics and transformative partnerships. Visit the event page for more information on speakers, discussion topics, and more.]
Waste is a resource. That simple sentence is the driving force behind one of the fastest growing economic trends in recent history—the circular economy. But how can businesses take full advantage of the circular economy to benefit their business and the environment? In 2016, UPS and GreenBiz Group teamed up to survey sustainability leaders and business decision-makers, and identify trends that can make the shift to a circular business model more feasible for companies.
The results from the 2016 UPS/GreenBiz Circular Economy Research Study reflected the following trends about the circular economy:
Demand is Rising—The demand for a shift to the circular economy is increasing among businesses. Nearly nine out of 10 sustainability executives surveyed believe that circular economy will be important to their business two years from now, nearly double from two years ago. Half of the companies surveyed are already implementing circular economy practices into product or service offerings.
The Need for a Business Case—The need for a strong business case is the top barrier for companies looking to adopt circular economy practices. At the same time, the effects of adopting circular economy practices also yield high business returns, making the need for a strong business case an opportunity as much as it is a barrier.
Cost and Convenience—Top implementation incentives for business customers and consumers are cost and convenience. According to the research, “generating market demand through incentives focused on cost and convenience will help bring the circular economy to market and scale.”
New Operating Models—Rethinking how products are designed and made, as well as developing innovative ways to reuse waste during the manufacturing process, is critical to the acceptance of the circular economy. Companies focus on product design, materials, and logistics to adopt a sustainable circular business model.
The Importance of “First Mile” Logistics—Packaging and shipping convenience of recoverable waste is a top acceptance factor, making “first mile” logistics crucial for broad marketplace adoption instead of the “last mile.” For example, developing smart packaging and convenient take-back processes can help create cost-efficient reuse and recyclability systems.
Insights from UPS and GreenBiz Group’s survey signal a great opportunity for the circular economy. Knowing these trends will help the business community make better-informed decisions, and help guide a more successful evolution and broad marketplace acceptance of this new business model.