The Global Circular Economy: The Impact of “Reduce, Re-use, Recycle” on Consumer Markets

Strategy Briefing

About This Report

Dec 2016

At current rates, we are using resources at more than 1.5 times the rate nature can replace them. Scarcity of resources, volatility of pricing and environmental damage are driving a shift to a circular economy which minimises wastage and aims to re-use or recycle all end products. Embracing this concept can help manufacturers not only control costs but also create points of differentiation, and appeal to a consumer base that cares about buying sustainable goods.

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The Global Circular Economy: The Impact of “Reduce, Re-use, Recycle” on Consumer Markets

From A linear to circular Economy

As the world consumes more resources than it can produce, there is an impetus to push away from a linear economy based on a make/use/dispose model, and towards a circular economy based on a reduce/re-use/recycle model that focuses on minimising waste and recycling or re-using all end products.

The need to control costs

For manufacturers, there are significant benefits to this approach beyond saving the planet. Resource volatility leads to an unpredictable raw materials flow, volatile costs and changes in regulation. Reducing dependence on these raw materials helps manufacturers control their costs and operations.

Circular strategies as key differentiator

However, reducing risk is not the only reason to pursue a more sustainable approach. Looking at a circular strategy allows for the generation of innovative ideas that serve as strong differentiating points and marketing tools.

Consumers keen to support sustainability

Furthermore, sustainability is important to a large number of consumers worldwide who are keen to embrace companies and brands which uphold such values.

Fashion at the vanguard

Fashion is a key area, due to the very rapid turnover of items, and due to the interest in re-use and repair as a fashion statement.

Electricals shift to lease or repair models

Appliances and electronics are also key due to heavy use of insecure resources and short lifecycles, with leasing schemes and repair/resale coming to the fore.

Tackling food and drink waste

Food waste and food packaging waste are also key areas, with many companies in Europe particularly active in working to reduce food waste.

introduction

The New Consumerism
Scope

Key findings

Key findings

WHAT IS THE CIRCULAR ECONOMY?

From a linear economy to a circular economy
Rising waste levels across Europe
Case study: Scotland works to align business and environment
What is driving the move to a circular economy?
Protecting resources protects the bottom line
Gaining business advantage through circular innovation
Leveraging consumer trends: particularly millennials

CONSUMER ATTITUDES

Green issues are important to consumers
Recyclability is the most credible of eco claims
Brazil, Turkey, Italy show greatest trust in “recyclable” labels
Consumer push to upcycling, creating and repairing

KEY INDUSTRIES: FASHION

The problem with fashion
Consumers rank sustainability as number one eco choice in clothes
Patagonia: Leading the trek
Mud Jeans: Circular denim

KEY INDUSTRIES: APPLIANCES AND ELECTRONICS

Electronics and appliances: The problem with washing machines
Green product features “very important” for appliances
Solving the laundry problem: Lease schemes
Electronics closes the loop
Electronics: The circular gaming economy

KEY INDUSTRIES: FOOD AND DRINK

Food and drink: The rising profile of food waste
Sustainability only number three for processed food
Food waste: Going full Cirkle
Coca-Cola tackles plastic drinks packaging

CONCLUSIONS AND RECOMMENDATIONS

Approaching a circular economy: Lessons learnt

Methodology and definitions

Data parameters

Internet vs Store-based Shopping

Further Insight