Circular business models like repair, reuse, resale, refill, and rental help households (and businesses) save money while reducing waste during a cost of living crisis.
Cost of living crisis
Energy, food and housing costs in the UK are rising, causing a cost of living crisis. That financial pressure is leading to changing customer behaviour. Consumers are spending less or not spending at all. But it is not all bad news. The circular economy provides practical and cost saving solutions and it benefits the environment.
What are circular business models?
The circular economy differs from the traditional ‘take-make-dispose’ model – that is so wasteful – by reusing and repurposing as much as possible, keeping products and materials in the cycle for longer. The advantages to circular business models are they can bring cost savings, reduce waste and use resources efficiently.
Circular models are gaining traction as households seek ways to stretch their budgets and be more environmentally friendly. There is growing distrust of disposable, low-quality goods but consumers need ways to buy better quality goods at a fair price. The circular business model can fill this gap.
Businesses are adapting to the demand from consumers for affordability, longevity and lower climate impact.
Repair
Repairing items can extend and continue their life. Local repair shops who offer furniture restoration, clothing alterations and electronic repair or refurbishment for resale are booming. Repairing can be lower cost than replacing with a new item. Items that have been refurbished, particularly those with a guarantee are attractive to consumers as they are typically lower cost than new. The right to repair movement is pushing manufacturers to ensure that spares and accessories are available for longer so that electronic goods can be refurbished rather than thrown away. Sunny Jar Eco Hub in Tower Hamlets teaches the local community how to repair their own clothing and Love Heartwood repairs precious children’s wooden toys.
Reuse and resale
The charity shop model has long been popular in the UK. Buying second hand goods is lower cost and less resource intensive than buying new goods. Charity shops, community swap groups and Freecycle platforms prevent our unwanted items from ending up in landfill when they are still perfectly good for use. Community of Creatives add a creative touch to second hand army jackets and denim jackets and the Rediscovery Centre in Ireland recycles and sells bicycles, clothing, furniture and paint. MPB sells second hand camera equipment at much lower cost than new.
Blue Patch facilitates the reuse of donated materials from brands – like the Royal Ballet & Opera – which our community make use of. We will be launching Materials to Makers soon for more of this kind of exchange.
Refill
Zero waste and refill shops are becoming more common. This business model allows consumers to refill bottles or buy only the amount they are likely to use. This eliminates food waste and plastic waste caused by buying kitchen and bathroom products in a new plastic bottle every time they are purchased. It also saves on fuel and transport where a local refill shop is available but this model doesn’t only have to be local. Online subscriptions are growing in popularity for refills for laundry detergent, dishwashing, cleaning and bathroom products. Jarr Market, our local refill shop, sells food and cleaning products.
Rental
Renting tools, appliances, baby equipment, occasion wear or even motor cars can be ideal for items that are infrequently used. It reduces the upfront costs and means you don’t have to store items that are rarely used. Renting is also ideal for items that will only be used in the short term for example, babies grow up quickly. Chloe Haywood London, who upcycles cashmere sweaters for resale, has rented outfits for special events (her wedding & film premieres).
Businesses can tap into the circular economy model and find new ways to serve their customer base during a cost of living crisis that reduce waste, lower the use of resources and keep products and material in circulation for longer. It can bring in new revenue streams through subscriptions, training, repair services and resale. More importantly, it aligns with environmental, social & governance ethics and sustainability goals.