There is a new trend in business which could not only transform the way we think about economy but also offers great potential for the development of exciting ideas and start-ups. 😉 🚀

This trend – or rather new school of thought – is called circular economy and arose in line with the sustainability movement. What makes circular economy so interesting and what distinguishes it from mainstream sustainability is that it is not based on waivers and restrictions of our behavior. Instead it acknowledges that humans want to consume and tries to make the process of consumption sustainable. As this sounds quite complicated let’s start simply and take a look at how our economy is currently constructed.

Status quo: linear economy

In our current economy, we take materials from the Earth (=resources), make products from them, and eventually throw the used and broken products away as waste – the process is linear. While this not only is harmful for the environment it also has economical disadvantages, as products nearly always depreciate until their value reaches zero, thus, eventually causing “losses” for the consumer.

Circular economy If you want to get a deep understanding of the topic we recommend you to check out the Ellen MacArthur Foundation and watch some of their videos concerning circular economy. For the purpose of this article we will just provide a very simplistic description of the concept.

The circular economy is based on three principles:

1. Eliminate waste and pollution
2. Circulate products and materials (at their highest value)
3. Regenerate nature

It does so by establishing material loops which keep materials in use and thus stop the production of waste in the first place. Hereby, it can be differentiated between two seperated material cycles, the biosphere and the technosphere.

To put it simple the biosphere focuses on producing products from biodegradable materials which can be completely recycled after their usage. Some companies use this approach and maufacture fully recycable clothes (→ checkt out the C2C-campaign by C&A: https://www.c-and-a.com/de/de/corporate/company/nachhaltigkeit/c2c/).

But not all products can be produced using biodegradable materials. Those products will thus become part of the technosphere. For products in the technosphere the goal is to extend the life-span as long as possible and prevent any waste from being produced. This means to improve longevity and durability in the first place, but also includes easier access to repair or reusage of individual parts. Also up- and recycling options need to be considered here.

Thinking about circular alternatives to existing products has the potential to transform global economics and is one lever to contribute to sustainability. Therefore, it comes also with a high entrepreneurial and is a future-oriented field to start a business in.

Maybe, you can check out the Circular R’s (https://www.circulareconomyasia.org/circular-rs/) yourself and think about opportunities to develop a business around them!