It’s April 2020, and we were a few months into the COVID-19 pandemic. We sought comfort in the wafting smell of Quarantine Baking as we rediscovered our kitchens… Milk and eggs disappeared from supermarket shelves as demand skyrocketed and supply chains buckled.
Meanwhile, those very same products were being dumped by the bucket load by restaurants and the farms that supplied them.
How did we get here? How did we find ourselves in this wasteful situation with two supply chains? The system is broken.
Part of the reason is that supermarkets and restaurants have entirely different supply chains. Over many years, they optimized their operations to produce and sell as much as possible. By design, any surplus would go to waste. With no room to adjust their operations, farmers couldn’t swap one marketplace for the other.
This is just one snapshot from one industry. Similar issues have plagued other supply chains all around the world. Whether it’s in the clothes, transport, or hospitality industries, it all looks the same. The pandemic has highlighted how vulnerable we are when relying on an overly linear, take-make-waste model of doing business.
Other trends are highlighting the same thing. Political change, new trade agreements, immigration policies, or climate change also highlight vulnerabilities in our linear model.
There are cracks throughout the system if you take the time to look for them. The pandemic just helped us see them more clearly.
While we all felt the pain as the global supply chain buckled, for some people, those problems inspired them to see opportunity.
Some organizations have started to color outside the (straight) lines of doing things. Breweries turned their taps from booze to hand sanitizer to help fight the virus. Laboratories developed ways to effectively decontaminate used face masks to avoid being thrown out after a single-use. Nearly all of us have learned to cut down on our travel and move our work online.
People’s ingenuity has shown there is another way. By stamping out waste and pollution. By being lean and resourceful. By challenging the old, linear way of thinking.
They may not always know it, but people doing this are embodying the principles of the circular economy. It’s more than a fancy term for recycling.
A circular approach means going from a “take-make-waste” use of the world’s resources to a “reduce-redesign-reuse”. It means keeping as much of the materials we use in the same system. It’s an approach that can help us reach net-zero and opens the door for innovation, job creation and economic development.
It makes good business sense too. Younger consumers are demanding more sustainable and ethical practices. They’re paying closer attention to companies’ green credentials and with whom they do business. An example from the fashion world: young shoppers are increasingly rejecting fast, wasteful fashion. Instead — another pandemic effect — they’re being more frugal. Last year in the US the used clothes market expanded 21 times faster than traditional clothes retail. It’s set to more than triple in value over the next ten years.
Investors are taking note too. Sustainable investing is set to reach record levels in the US. Investors are scrutinizing and making decisions based on companies’ behavior during the pandemic and whether they embody those circular principles.
But what do we actually mean by circular?
Nature can help us explain the circular economy. Cast your mind back to your Biology lessons at school.
Remember the carbon cycle?
A daffodil uses the energy of the sun, carbon dioxide, and water to make its own building blocks for growth. A slug munching on these daffodils gets all the building blocks (e.g., carbon, nitrogen, oxygen) it needs from the flower. Our slug and daffodil eventually die, decomposing…. the building blocks go into the soil, air and get used up by countless other living beings for their own growth.
Think of the circular economy in this way. It’s cyclical, self-sustaining, and regenerative. An ecosystem with loads of players that depend on each other. All acting within the limits of the natural world, and giving back to it.
Let’s take that analogy further and apply it to businesses:
We’ve compiled some circular economy examples in the next section as inspiration. We hope they help you to ask useful ‘how might we…’ questions .
Reduce waste and generate value from it?
Example: The City of Austin has created an Austin Materials Marketplace. It’s an online exchange platform that keeps materials and products out of landfill and in use. This reduces the cost of waste management for the city but also allows businesses to advertise or bid for surpluses. This either generates income or saves businesses money.
Keep materials and products in use?
Finnish jewelry company EKORU handcrafts jewelry out of old coins, spoons and other cutlery. They also promote the technique (and generate additional revenue) by hosting metalworking workshops. The company limits the need to source the coins and cutlery: customers usually provide them.
Regenerate the natural systems on which we rely?
French farm Bec-Hellouin has created a farm where wildlife can coexist with agriculture. They’ve adopted regenerative agricultural practices. This means staying as true as possible to natural processes. The result is increased quality of the area’s soil and biodiversity whilst producing a huge range of produce. Their inspiration includes Amazonian tribes and 19th-century Parisian market gardeners.
Let’s circle back to thinking about quarantine baking. We can see hints of the journey from linear to circular beginning to happen in the food industry.
Some restaurants now deal with surpluses from unexpected fluctuations in supply and demand by offering meal kits to cook at home. Others have dipped into the world of online cooking lessons, generating new revenue whilst being lean. Meanwhile, farmers are growing crops with fertilizer created from potato waste and CO2 captured from beer fermentation. They’re also using tech to track their own surpluses, redeploying them to food banks to reach the people who need it.
It all adds up to a more sustainable, self-contained, and resilient way of doing things.
These changes don’t happen overnight. They’re usually borne out of necessity. Sometimes they’re accidental… and they always require trial and error.
This incremental, iterative innovation is a truer reflection of how the world works. Trying new things, learning from others, and sharing outcomes will be necessary for all of us to find circular action.
Start today- go out and ask someone how they might generate value from an unexpected part of their work…or how they might reuse materials that would otherwise go to waste. Better yet, can you tackle these questions by working together?
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