As the need for agility and resiliency increases, sup- ply chains are searching for ways to evolve, be- come more efficient and more able to endure unex- pected challenges. Whether caused by the ongoinggrowth of e-commerce, adjustments in shopping habits, or achange in product preferences, supply chains are always in fluxand they need to be able to flex to accommodate those evolutions.Supply chains can fulfill that mission, and overcome their obstacles, by adopting a circular economy model.
Built to endure everyday challenges, as well as the massive dis-
ruptions that have been occurring throughout the world, a circular
economy model encourages continuous reuse of materials to min-
imize waste. It drives demand for natural resource consumption,
attracting interest from a wide variety of companies spanning vir-
tually every industry on the planet.
Despite the potential, some may wonder if the circular economyis a near-term development or simply a dream of the distant future.But it is actually here right now. It involves a total shift in the waysupply chains think about their business, evolving from traditional supply chains, which extract raw materials, process them intoproducts, and ship them to retailers or consumers. This linear process typically means that, when the supplies reach their end of life,they are discarded like any other item deemed to have lost all value. The circular economy is changing this in a big way, eliminatingwaste by reusing and recycling whenever possible.
A STRONG BUSINESS CASE
FOR GETTING STARTED
The reason for starting a circular economy may be altruistic
but make no mistake: There is a strong business case for adopt-
ing a more circular strategy. E-waste adds up to approximately 50
million metric tons of garbage every year. Put another way, that
amounts to $62.5 billion in material value—and only 20% is being
formally recycled. According to the American Association for the
Advancement of Science, the circular economy stands to reduce
plastic pollution while slowing down the impact of climate change.
These are important considerations. One report from Accenturefound that 82% of U.S. shoppers are open to using brands withenvironmentally-friendly values and a strong purpose. AnotherAccenture report revealed that 83% want companies to designproducts that are meant to be reused or recycled, and more thanhalf want packaging to be eco-friendly—and they might even paymore for it.
Sales analysis confirms this to be true, with NYU Stern Centerfor Sustainable Business finding that sustainably-marketed products accounted for 55% of the growth within consumer packagedgoods between 2015 and 2019. Sustainability also empowers businesses and their supply chains to be more transparent, and that inturn improves responsibility by increasing agility, resiliencyand cost-effectiveness.
However, the circular economy is not just about theway products are packaged or how they are perceived
GLOBAL SUPPLY CHAINS
Start Planning Now for the
The world’s largest brands are adoptinga circular economy model. Learn whyyou should, too.
By Adam Bimson
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