Almost half of the world’s top 100 companies utilize the so-called circular economy to counter the wastefulness of the traditional linear model, according to new research by PwC. In this concept, one companyʼs waste may prove to be anotherʼs raw material.
“Global megatrends, such as energy deficiency, technological breakthroughs, and the appearance of new generations, create an environment in which products ending up in the trash are considered wasteful,” says Ádám Osztovits, leading partner of PwC Hungary’s advisory branch, in a press release sent to the Budapest Business Journal. “Companies that recognize the untapped potential of products and materials can enter new markets, lower costs, and increase the number of their consumers,” he adds.
The circular economy’s core concept is recycling, turning today’s products into the raw materials of the future. However, it is more than a simple recycling process, as it transcends industries and value chains to redefine product planning, production, and even consumption, opening new markets for companies.
The tools of the circular economy in practice depend on who is responsible for them in the value chain. Most of the tools are not new, but they become more powerful if all members of the value chain use them together, says PwC. Sustainable design means that a product’s lifespan and usability is taken into consideration already at the planning phase, minimizing its environmental footprint. Maintenance and repairs are focal points of the concept, as they may extend a product’s lifespan.
“The circular economy is more than recycling, as its tools arch over industries,” notes PwC Hungary advisor Júlia Perger. “If something is the waste of one industry, it may still be the raw material of another, and therefore valuable, as cooperation resulting in both a decrease in costs and an increase in efficiency and brand power may happen even between different industries,” she adds.