Employing a circular supply chain isn’t just good for the environment, it actually makes perfect business sense, writes Peter Windischoffer, co-founder and CEO of Refurbed.
Since the industrial revolution, we have been relying on natural resources to raise our standard of living. However, those natural resource, especially fossil fuels, have resulted in climate change, hence we need to find new ways of living to create a more sustainable environment.
At COP21, Karmenu Vella (the European Union Commissioner for Environment, Maritime Affairs and Fisheries), stressed the need to switch to a more circular economy. He declared that the EU had set aside €650m to fund innovative ways to change consumers’ usage of raw materials, reduce electronic and food waste, develop new recycling techniques, come up with new construction materials (and new ways of using old ones), and create new energy sources out of waste.
“Any business can enact the circular economy by taking small steps and thinking more consciously about its tech”
Employing a circular supply chain would aid processes, such as product design, procurement and waste management in becoming more efficient and productive. Circular supply chains are a core component of the refurbishment industry, enacted by companies such as refurbed.
Born again tech
The refurbishment industry is built on the premise of giving a device a second life – according to EUREFAS, the European Refurbishment Association, the European refurbishment market is currently worth €5.2bn and is expected to reach $67bn globally by the end of this year. Refurbishment is the process of reviving old or damaged products and the industry itself comprises businesses that specialise in refurbishment and repair.
Engaging in the refurbishment industry can help businesses close the loop, lengthening product life cycles. Products or devices developed within the industry reuse the raw materials of old products to produce refurbished high-quality products.
The benefits of the refurbishment industry for businesses are plentiful; it generates vast employment whilst the very premise promotes sustainable development and the circular economy by enhancing old or damaged goods. The additional, more obvious benefit, is that it helps reduce a business’s carbon emissions and environmental footprint.
The digital refurbishment industry in particular has limited the amount of e-waste that is created from the dumping of old devices while allowing businesses and consumers to stay up to date with the latest technology at vastly reduced costs – hence, it’s critical that the supply of devices keeps pace with demand in order to sustain the industry’s growth.
However, the growing refurbishment market has been considered as a threat by major players within the personal devices and electronics industry who have begun to create barriers to prevent its development. A major driver of the refurbishment industry is the right-to-repair movement. The movement’s focus is to increase the lifespan of a device to last at least 10 years, which ultimately will reduce e-waste. However, the tactics that many large corporations use to prevent the development of the refurbishment industry are a violation of this right.
Businesses have a unique opportunity to play a key role in combating these inhibiting strategies. Now more than ever, it is vital that companies begin to look at their practices and incorporate circularity into their everyday operations.
Refurbed sees three ways businesses can start:
- Recycle more and better,
- Rent goods, and
- Lengthen the longevity of products
When businesses begin to enact the circular economy they should do so in a way that aligns with their business’s capabilities and resources. An easy way that businesses can take small steps to begin to engage in the circular economy is by choosing to buy refurbished devices for any new employees entering the company. These devices are often designed with longevity in mind.
Companies must also make sure that obsolete devices are either put to good use or properly disposed of. Businesses can sell their used electronics to many refurbishers that offer buy-back programs. This enables the business to recycle more efficiently and to profit from outdated and underused equipment while supplying goods to meet demand.
It’s easy to see why more and more manufacturing companies are talking about what’s often called the circular economy – in which businesses create supply chains that recover or recycle the resources used to create their products. Shrinking their environmental footprint, trimming operational waste, and using expensive resources more efficiently are certainly appealing to CEOs. Creating a circular business model is challenging, and taking the wrong approach can be expensive.
Any business can enact the circular economy by taking small steps and thinking more consciously about its tech. At the Paris Climate Summit on 12 December 2015, 196 countries signed an agreement to create a better future. This won’t happen without innovative solutions from businesses and consumers. The sooner we build a circular economy, the better it will be for all of us.