The Circular Economy - April 2021 - Trajectory Partnership

Page created by Louis Wallace
 
CONTINUE READING
The Circular Economy - April 2021 - Trajectory Partnership
The Circular Economy

                       April 2021
The Circular Economy - April 2021 - Trajectory Partnership
Contents

Contents                                  About this report
                                          This report sets out to examine the current dynamics and future
Summary                              3
                                          prospects for the circular economy through looking at examples of
                                          brands adopting to circularity.
Implications                         4

Introduction                         5

Sector Study: The Fashion Industry   10

Charitable Lost Cause                14

Conclusion                           17

References                           18

                                                                                                              2
The Circular Economy - April 2021 - Trajectory Partnership
Summary

The climate crisis demands radical solutions and the transition to a
circular economy (based in reuse and recycling) represents a
revolution in how products of all types are made.             Many
governments are now creating legislative frameworks that will
enable – and enforce - the transition to a circular model. The
concept of ‘planned obsolescence’ is anathema in an era in
which we move towards the reuse and recycling of goods.
Consumers – increasingly alarmed at the reality of climate change
– broadly support policy makers in wanting to reduce waste and
live more sustainably.

The circular economy will energise extant secondhand and
reselling platforms while many brands are likely to have a new
relationship with consumers as the customer journey is extended
into resale, repair and refurbishment. Ultimately, the ambition of
moving to a circular economy by 2050 can only be achieved by
international cooperation and the ability of political and business
leaders to persuade consumers to buy more thoughtfully.

                                                                       3
The Circular Economy - April 2021 - Trajectory Partnership
Implications
Consumer                                          Business                                           Government
be welcomed.                                       welcomed.                                          welcomed.
• Consumers may have to adjust to some            • The ‘right to repair’ and the demise of          • COP 26 in November is likely to act as a
  products becoming more expensive as               planned obsolescence extends product               catalyst in generating further new measures
  manufacturing processes change.                   lifetimes which will impact future sales. This     to support the circular economy.
                                                    may be offset by an efficient resale / repair
                                                    business.
• Categories like ‘fast fashion’ begin to look                                                       • The circular economy requires global
  very last season. Consumption of many                                                                solutions and binding agreements to force
  products is accompanied by guilt.               • Greater regulation of manufacturing                change. Organisations like the EU and the
                                                    processes and a likely increase in red tape.       UN need to act as brokers to bring
                                                    In some cases, the manufacturing process           countries together.
• Consumers have many more options in               will change significantly.
  disposing of unwanted items as reselling
  platforms multiply. Giving to charities is no                                                      • Governments need to support new
  longer a default option.                        • Some brands will compete not just with rival       recycling initiatives - including doorstep
                                                    brands but with their own secondhand and           collection schemes - to capture and reuse
                                                    reconditioned products sold via third              electrical and electronic items.
• A gradual change in consumption habits as         parties.
  consumers become more thoughtful in
  what they buy. Ultimately, they may                                                                • There is the potential for new taxes to
  purchase fewer but better-quality items.        • Renting infrequently used or unsold luxury         discourage waste and encourage
                                                    items becomes a greater commercial                 recycling.
                                                    opportunity.
                                                                                                     • Geopolitics. Recycling more materials like
                                                                                                       rare earths and lithium reduces the West’s
                                                                                                       dependency on countries like the
                                                                                                       Democratic Republic of Congo and China.
                                                                                                                                                     4
The Circular Economy - April 2021 - Trajectory Partnership
Introduction
 “…the circular economy is in fact our guarantee for sustainable growth of
 our economies.”
       – European Commissioner Virginijus Sinkevicius, Brussels, March 2020.
 The circular economy is defined in different ways. According to Eurostat:
 “The purpose of a circular economy is to maintain the value of products,
 materials and resources for as long as possible by returning them into the
 product cycle after they have reached the end of their lifecycle, while
 minimising the generation of waste.”
 The Ellen McArthur Foundation defines it as; “…a systemic approach to
 economic development designed to benefit businesses, society and the
 environment. In contrast to the ‘take-make-waste’ linear model, a
 circular economy is regenerative by design and aims to gradually
 decouple growth from the consumption of finite resources.”
 In short, the circular economy is about recycling more and discarding
 less.
 A very traditional example of the circular economy is the use of spent
 grain from the brewing process as feed for cattle, pigs, sheep and
 chickens. The soggy mass of ground kernels created by brewing can
 account for over 80% of the byproduct.
 More generally, moving the global economy from a linear to a circular
 model requires a revolution in the way that we make and consume
 products. This revolution is essential if we are to achieve pressing carbon
 reduction goals and to live more sustainably. The move to a circular
 economy will impact almost all businesses.

                                                                               5
The Circular Economy - April 2021 - Trajectory Partnership
History
What goes round comes round: there is nothing new about the circular economy. The concept has been discussed since the 1970s. The concept was
codified by the German chemist Michael Braungart and the American architect William McDonough in their 2002 book, Cradle to Cradle: Remaking the
Way We Make Things. Their legacy lives on through a Cradle to Cradle certification scheme that is supported by Amazon, Walmart and The Home Depot in
the United States. Walgreen Boots Alliance also recognizes C2C certification, describing themselves as; “…working to enable consumers to make informed
choices by encouraging suppliers to obtain credible certifications(…such as Cradle to Cradle Certified) and to make it easy for consumers to find these
more sustainable products.”
As the concern about climate change and sustainability has grown in recent years, the circular economy has again come to the fore. Consumers are
modifying their own behaviour in response to the climate crisis and in many cases they are trying to cut down on waste (for both environmental and
financial reasons). At the same time governments are increasingly creating legislation to boost recycling. These forces will only become more intense in the
future.

How big is the circular economy?

In the EU, Eurostat have been measuring the size of the circular economy through the ‘circularity rate’ (the share of material recovered and fed back into
the economy). In 2019 the rate of circularity in the EU was 11.9% - an increase of 3.6 percentage points from 2004. The circularity rate is lower than most
recycling measures because it covers some types of materials that can’t be recycled. Eurostat gives the following examples of materials that are counted in
the circularity rate; “…food and fodder, and fossil fuels used for energy production or for material use – e.g. plastics, buildings, infrastructure and vehicles.”
The circularity rate can be increased in two ways – by recycling more and by using less raw materials and resources in the first place. For example,
renewables boost the circularity rate when they replace fossil fuels as sources of energy generation.

                                                                                                                                                                     6
The Circular Economy - April 2021 - Trajectory Partnership
The circularity rate varies widely across Europe – from 28% in the
Netherlands to 1.5% in Romania. The UK’s circularity rate was 17% in
2019.
In the summer of 2020, the not-for-profit group, Circle Economy,
estimated that the global economy was 8.6% circular.
The Netherlands has committed to having a fully circular economy
by 2050. While they currently lead Europe in this transition, Circle
Economy believes four key measures are required to lift their CR to
70%:
•   Construction. Stop demolishing buildings and ensure that
    building methods are centred on renovation and reuse of
    materials.
•   Agriculture. Prioritise waste reuse and local trading, such as
    stopping the import and export of animal products and using
    food waste to feed livestock.
•   Energy. Increase use of renewable energy and phase out fossil
    fuels.
•   Manufacturing. Double the current material use of the repair
    sector, as well as the amount of high-value recycling and the
    share of recycled materials in imports.
Clearly, these are measures that all countries will have to adopt.
Which brings us neatly to the right to repair.

                                                                       7
The Circular Economy - April 2021 - Trajectory Partnership
It’s right to repair                                                        e-Waste
In March 2021, the UK government announced new energy efficiency            Apple’s change of heart over hardware repairs may have been
legislation. Part of the legislation tackles ‘premature obsolescence’       driven - in part - by the increasing problem of eWaste. According to
through obliging manufacturers to make spare parts available to             the UN, the world produces as much as 50 million tonnes of
consumers – a legal right for repairs. The intention is to extend the       electronic and electrical waste a year. Only about 20% of this is
lifespan of products by up to a decade.            According to the         formally recycled. Meanwhile, as much as 7% of the world’s gold
government, the UK generates about 1.5 million tonnes of electrical         may currently be contained in e-waste. Other rare and valuable
waste each year. Commenting on the legislation, Business and Energy         materials such as platinum, cobalt and rare earth elements are
Secretary, Kwasi Kwarteng said: “Our plans to tighten product               being lost through e-waste. In an effort to arrest the growing
standards will ensure more of our electrical goods can be fixed rather      problem, the Nigerian government, the Global Environment Facility
than thrown on the scrap heap…”                                             and UN Environment have partnered to formalise the e-waste
In Australia the Productivity Commission – a branch of government – is      recycling business that operates in Nigeria, making it more efficient
also looking at a right to repair. Specifically, they have been asked to:   and improving conditions for the 100,000 people who work in the
“…look at arrangements for preventing premature or planned product          industry. Each year half a million tonnes of e-waste are processed in
obsolescence and the proliferation of e-waste through improved              the country.
access to repairs.”7 The Commission is due to report to the Australian      There is a geopolitical element in making better efforts to reclaim
Government in October 2021.                                                 rare materials from waste as the US National Intelligence Council
In February 2021, the European parliament voted in favour of                makes clear in its recent assessment of the world in 2040; “…a shift to
establishing a right to repair as part of a broader set of circular         renewable energy will increase competition over certain minerals,
economy initiatives. Policies may appear later this year.                   particularly cobalt and lithium for batteries and rare earths for
                                                                            magnets in electric motors and generators. As actors race to
As more countries enact measures on the right to repair, brands have        develop new renewable energy technology during the next two
started to respond.     In August 2019, Apple announced a new               decades, they will focus on countries that supply these minerals,
Independent Repair Provider Programme which means that it will;             such as the Democratic Republic of Congo and Bolivia.”
“…provide more independent repair businesses – large or small – with
the same genuine parts, tools, training, repair manuals and diagnostics
as its Apple Authorized Service Providers.” Previously, Apple’s position
was that independent menders lacked the skills and experience to
properly repair an iPhone. A growing (and global) right to repair
movement may have helped in changing their mind.
                                                                                                                                                      8
The Circular Economy - April 2021 - Trajectory Partnership
Recondition
Some manufacturers are aware that profligate waste is a looming ESG issue. There is a concern that consumers will blame manufacturers for encouraging
them to needlessly upgrade mobile phones, televisions, laptops and other consumer goods, thus creating an ever-accumulating mountain of e-waste. This is
one factor in the growing market for reconditioned and refurbished products. Around 200,000,000 used or reconditioned mobile phones were sold globally last
year and the market is growing at about 9% annually.
In the UK, Samsung offer Certified Refurbished phones with a one year warranty. Each phone receives 400 quality assurance tests and is sold with a new
charger and ear buds. The phone is wrapped in new packaging and to all intents and purposes the handset is new. 12
Amazon sell pre-owned laptops, phones, tablets, cameras, televisions and office equipment under the ‘Renewed’ banner – these are refurbished products that
come with a warranty. Consumers can buy with confidence while also saving substantial sums if they are willing to accept a machine that is a couple of years
old. An increasing number of consumers will derive satisfaction from saving a serviceable bit of kit from the Himalayan mountain of e-waste. A proposition that
combines sustainability with value for money is powerful and explains why newer operators are entering the market.
Back Market is a; “…marketplace that fights back against planned obsolescence” according to the company. Their American MD articulates the original
vision succinctly: “Back Market envisioned a platform dedicated to high-quality, refurbished electronics that would make restored devices mainstream.” They
sell refurbished electronics in a number of countries including France, Spain, Italy, Belgium and Austria; the UK, the US and Germany are markets that the
company is particularly focused on. Back Market’s ambition is to be a category leader in the circular economy – a ambition that was supported by a
successful funding round that raised $120 million in May 2020. Goldman Sachs was one of the investors. Back Market quote Edelman research that shows 64%
of consumers are ‘belief-driven buyers’ (i.e. those that seek out brands that support their own values). They also estimate the value of the refurbished devices
market at $80 billion. Their CEO, Thibaud Hug de Larauze, said of the investment; “…we can reinforce our leadership in this market and have a lasting positive
impact on consumers’ perceptions about refurbished devices.”13

Repositioning ‘secondhand’
Mr Hug de Larauze’s final point on consumer perceptions is an important one. Traditionally consumers have been wary of reconditioned products, fearing that
they would perform less well than new products or that they’d look old and scruffy. Back Market reassures consumers on hardware functionality through
comprehensive guarantees and warranties – a big part of the reason that they were the first third-party company that Apple included in their certified
refurbished programme. When it comes to the appearance of devices, Back Market offers consumers a choice – those seeking pristine, as-new devices pay a
little more while those who are willing to accept some visible signs of wear pay less.
Back Market seeks to reposition secondhand items as legitimate alternatives to buying new. Many other companies are doing the same. The uptake from
consumers is strong and growing. All of this suggests that people are thinking more positively of pre-owned items.
                                                                                                                                                              9
The Circular Economy - April 2021 - Trajectory Partnership
Sector Study: Fashion
The average consumer now buys 60% more items of clothing than they did in
2000. Two fifth of the clothes we buy are never worn and every year 21 billion
tons of textiles are heaved into landfills. Waste on this scale is unsustainable
and increasingly unfashionable. Expressions of distaste are multiplying. In July
2017, WRAP conducted quantitative research which found that 18% of
consumers believed that; “the impact of clothing on the environment is not
that severe.” When they asked the same question in May 2020 the proportion
was just 11%.
The slow fashion movement – as the name suggests – is opposed to disposable
fast fashion and encourages consumers to buy better quality items that last for
longer.
Slow fashion is one form of the increasing distaste consumers have for the
waste caused by fast fashion. ‘Sinnfluencers’ are a lot more worthy (and
possibly less exciting) than they sound – the term comes from the combination
of the German word ‘sinn’ (purpose and meaning) and ‘influencer’. Their
significance is considerable. Many consumers wish to live more sustainably but
are looking for guidance on how to do so. Some are now looking to
influencers or brands to help them make more sustainable choices. Lauren
Singer’s Instagram account trashisfortossers is followed by 380,000 people and
is forthright in its condemnation of unnecessary waste. Many brands are keen
to connect with Sinnfluncers as a way of projecting their credentials on
sustainability. In April 2021 Singer partnered with Diageo-owned Johnnie
Walker whisky on their Next Steps initiative which aims to make the brand more
sustainable by design. She also works with Bausch & Lomb on more sustainable
contact lenses and with Nordstrom on packaging.

                                                                                   10
In the UK Megan Hines’ Instagram account Look Fabulous For Less details her ongoing battle to live a stylish
yet sustainable life. Alarmed by a burgeoning wardrobe and the environmental consequences of buying
so many rarely-worn new clothes, she was motivated to create a spreadsheet which calculates the cost-
per-wear of each garment. The spreadsheet is not just about value for money but how often clothes are
worn in the first place (her target is to wear each item at least five times). She has disciplined herself into
consuming less and now has a wardrobe that is; “79% pre-loved.” She is an example of a consumer who
feels guilt in buying new clothes – a guilt that is assuaged if the items are pre-owned. Incidentally, if a
spreadsheet seems an onerous undertaking there is the Shopola cost-per-wear app for iPhone users.
In May 2020 WRAP conducted research into how consumers intended to dispose of clothes they had
cleared out during the first part of lockdown. 10% of those respondents who had cleared out their homes
planned to sell items online. That proportion may be lower than normal as a clear-out implies a larger
number of items for disposal than usual, meaning that a charity shop may be a more convenient solution
than selling multiple items online. There are a growing number of ways for consumers to sell unwanted
items:
• Vinted is; “a community for pre-loved fashion.” The Lithuanian-owned company has 37 million members
  and is active in twelve countries including the UK, Spain, France, Germany, Austria, Poland and the USA.
  Between 2013 and 2018 the company attracted $100 million of investment. Users download an app,
  take a picture of items they no longer want, set a price and upload their listing. Buyers can ask vendors
  questions and are covered both by a refund scheme and an optional buyer-protection scheme.
• Depop is a peer-to-peer social shopping app based in Manchester which aims to make; “…fashion more
  inclusive, diverse and less wasteful.” It claims to have 26 million users worldwide. The Depop community
  is youthful; 80% of active users in the UK are aged under 26. Depop started as a social network that
  allowed the readers of PIG magazine to buy the clothes featured in the magazine. They then pivoted to
  include a selling function and then created; “…a mobile space where you can see what your friends
  and the people you are inspired by are liking, buying and selling.”
• Sellpy is a Swedish based e-commerce site for secondhand clothes, electronics and homewares. It has
  steadily expanded across Scandinavia and in February 2021 it started operations in the Netherlands and
  Austria. Their CEO, Michael Arnor, explains the ethos of Sellpy; “We see a steady growth in demand for
  sustainable consumption, where secondhand is a great option. Every garment bought pre-owned saves
  resources for our planet. It’s therefore very exciting that we continue to grow and empower more
  customers in Europe to live circular.”18                                                                        11
The fashion industry’s response to the changing
consumer mood
As consumers becomes more sensitive to waste and seek to live more sustainably,
brands have had to respond.
The significance of Sellpy is that H&M have been investing in the company since
2015. The rationale for H&M is; “…the transition from a linear to a circular use of
textiles is an important goal in working towards a more sustainable fashion
industry. Investments in new business models in the areas of rental, repair and re-
commerce play a vital role in this respect.”19
Nanna Andersen is the head of H&M’s investment arm, CO:LAB H&M Group.
Commenting on their investment in Sellpy she said; “We truly believe in the
entrepreneurs and team behind Sellpy and their unique circular business model,
which perfectly aligns with our vision to become fully circular.”20
In 2019, Zara stated that their clothes would be made from 100% sustainable
fabrics by 2025. It started collecting used clothes in its shops some years ago and
has formed a partnership with charities (including the Red Cross) to redistribute
clothes. It is also working with the Massachusetts Institute of Technology on new
techniques in recycling textile fibres.21
Most clothes are sold on the high street but much of the glamour in fashion comes
from the shops found on Sloane Street. In December 2020, Gabriela Hearst was
announced as the Creative Director of LVMH-owned Chloe. Hearst has her own
eponymous luxury label which has sustainability as both core value and point of
difference. In her 2017 show she used clothes made from surplus fabric and her
goal is to use 100% repurposed materials by early 2022. She has brought that
ethos to her new role, saying on her arrival at Chloe that she wanted to support
LVMH’s goal; “…to create a business that is socially conscious and in balance with
our environment.” Chloe is currently seeking B Corporation certification for social
and environmental performance.
                                                                                      12
Other labels are encouraging consumers to repair or refurbish
 clothes. Patagonia’s Worn Wear scheme invites consumers to get
 their clothing repaired or to trade it in for a credit against new
 items. The company claims to have repaired over 400,000
 garments in North America since 2005. In addition, their
 “ReCrafted” range of clothes are made using material from old
 garments.
  Worn Wear state that; “One of the most responsible things we can
  do as a company is make high-quality stuff that lasts for years, so
  you don’t have to buy more of it.” Here is a successful brand
  skillfully positioning itself as aligned with a nascent anti-consumption
  sentiment (while still selling new garments). They are not alone. The
  grande dame of British fashion, Vivienne Westwood, famously
  commented; “My message is, ‘Buy less, choose well, make it last.’”
  That sentiment – of buying better quality items less often – is one
Source:
  that we  Trajectory
              are likelyAnalysis
                         to hear of YouGov/Cambridge
                                 more   often in the years Globalism
                                                           ahead. Project Data
 While the industry is changing from within, it has also been forced
 into change by new laws. In the five years to 2018, Burberry
 destroyed £90 million in unsold clothes accessories and perfumes to
 prevent them being sold cheaply or stolen. Such activity –
 widespread in fashion – will be banned this year under the EU
 Circular Economy Action Plan.

                                                                            13
Charitable lost cause?
The increasing commercial activity around reselling is something of a
double-edged sword for charities. On the one hand an increasing
desire to buy pre-owned items is helpful and may even serve to lift
values. On the other, many consumers will wonder if they should sell
unwanted items rather than give them away to their local charity
shop. musicMagpie buys CDs, DVDs, computer games, books, Lego
and tech (all charity shop staples) from consumers before reselling
them (often through eBay or Amazon) for a profit. musicMagpie
claim to have over six million customers. Their model is changing as
the demand for physical media declines – by 2018, half of their
business was selling reconditioned mobile phones.
Charity shops now operate in a more competitive environment and
the volume of items donated to them may decline. The Charity
Retail Association helps their members exploit the e-commerce
opportunity to reach more customers, especially the young. An
additional benefit of moving online is that unusual and more
valuable items are likely to be sold for a higher price through e-
commerce. In 2018 the Charity Retail Association surveyed members
representing 5,967 charity shops. When they asked what the
motivation was to sell online, 88% of respondents said that it was; “to
achieve a higher selling price online.” This desire to realise higher
revenues means that charities are heavy users of reselling
marketplaces such as eBay, AbeBooks and Depop.
Companies like Zipsale help resellers develop a presence in multiple
online marketplaces to increase sales and reach an international
audience. Zipsale also helps with inventory management, sales
analysis and translation.
                                                                          14
Other operators offer different takes on online models. In 2017 Thrift+ was
created to; “…build the best online shopping experience for secondhand
clothes while making it easy for individuals and brands to re-sell
unwanted items.” Part of their proposition is aimed at consumers who
want to make donations to charity. Thrift+ offers to take higher value
donations from consumers, sell them online and then share some of the
proceeds with a nominated charity. Consumers use a Thrift+ bag to
donate items which are typically resold for £60 with £20 going to charity.
Thrift+ claim that – as there are no shop rents or staff costs to pay – this
return is as good as (or better than) a direct donation to a charity shop.
The circular economy forces innovation from charities who have
responded both through a greater online presence and the
development of larger format superstores on retail parks. Despite the
higher staffing requirement these stores are more profitable than the
traditional high street shops.
The context in which charity shops operate is changing quickly partly
because a number of disparate players are working to reposition
secondhand as a more positive choice. Charity shops are still the front
line in recycling for the majority of consumers – an enviable position in a
circular economy. The biggest challenge for charities is to find enough
individuals with skills in online sales to capitalise on their high street
presence (72% of charities report that a shortage of paid staff and
volunteers in online selling roles is their biggest challenge in going digital).

                                                                               1615
Government intervention
The political commitment to developing a circular economy is growing and has implications for
almost all companies.
2021 is the planned adoption date for a number of EU initiatives including:
•   Legislative proposal for substantiating green claims made by companies
•   EU strategy for sustainable textiles
•   Review of EU rules on packaging and packaging waste
•   Update of EU rules in industrial emissions
Another measure is a; ‘legislative proposal to empower consumers in the green revolution.’ The
aims of this legislation include; ensuring that consumers get reliable information on products
(including lifespan and repair options) and setting a minimum requirement for sustainability logos
and labels.
In addition, in February 2021, the Global Alliance on Circular Economy and Resource Efficiency
(GACERE) was launched by the European Commission and the United Nations Environment
Programme. This organisation’s goal is to; “…provide a global impetus for initiatives related to the
circular economy transition.” Member countries include Japan, Canada, Norway and all members
of the EU.
In July 2020 the UK government issued a Circular Economy Package policy statement. This restated
the government’s commitment to the circular economy post-Brexit through a legislative framework
largely based around waste and recycling. The UK nations all have their own initiatives – for
example the Scottish Government’s strategy is set out in Making Things Last31 which was published
in 2016. Although light on targets, the document does specify that food waste must be cut by a
third by 2025. The strategy also states that; “We want secondhand goods to become a good
value, mainstream, option - helping reuse businesses and community organisations to thrive. We
will improve the capture of items for reuse; clarify the regulation of reuse activities; and build on the
Resolve standard for reuse organisations to improve consumer confidence.” This language is very
similar to that of commercial organisations such as Back Market and indicates that there will be
support from government for companies involved in recycling, refurbishing and reconditioning,
something that will encourage new players into the market and grow the circular economy.                    16
Conclusion
The move to a circular economy is revolutionary and essential.
When the European Commission set out the European Green Deal in 2019 it
did so because it believed the transformation to a circular economy was
happening too slowly. The acceleration is now noticeable and is backed by
an increasing regulatory framework. However, to succeed there needs to
be international cooperation - domestic initiatives taken by individual
countries count for little in global value chains. Without uniform international
regulations inefficiencies will be created; for example the importation of
secondhand goods into some countries can hinder their transition towards
lower carbon and more circular economies.
While the transition to the circular economy will impact all commercial
organisations it is true that some sectors will be more impacted than others:
textiles, construction, electronics and plastics are areas of particular focus for
European Circular Economy Action Plan. These are resource-intensive
sectors that consume huge amounts of raw materials and have acute
problems with waste.
Joe Biden’s administration has set out bold plans for the environment. While
there is little detailed policy yet on the circular economy, we can expect
new measures. COP 26 at the end of the year will likely lead to new
initiatives to support circularity.
In general, policy makers have support from an increasingly anxious public.
The act of consumption is becoming increasingly freighted with guilt.
Purchasing reconditioned or secondhand items can mitigate that guilt. The
allure of showroom-fresh new consumer goods will never go away but their
appeal can be strengthened if they are made from materials which have
been (imperceptibly) recycled.
                                                                                     17
The distaste for waste suggests that consumers will adopt a
cost-per-wear mentality, getting greater use from items that
they own. They are likely to be more thoughtful in buying new
things. That mentality means it will be more common for
owners to repair items or even to sell them back to the
manufacturer (as clothing firm Patagonia do).
A circular economy is also likely to boost the market for renting
rather than owning products; designer clothes and
accessories can be rented through Selfridges,33 while jewellery
can be hired through Bentley & Skinner. Car sharing schemes
like that operated by Geeley-owned Lynk & Co 34 also make
sense in a circular economy.
From the perspective of brands, the circular economy means
revolutionary change in how products are made, consumed,
repaired and resold. For many companies this means that the
customer journey extends far beyond the original sale of the
product. There are opportunities to deepen the customer
relationship with more touchpoints on an extended customer
journey as products are bought, maintained and resold.
This Trajection considers the actions of a raft of brands in
adapting to a circular economy. While some of these
examples may seem exceptional now they will become
increasingly common as consumers demand more sustainable
lifestyles and as policymakers insist on circularity.

                                                                    18
Subscribers get access to all our trends analysis, presentations, reports
and articles, including our monthly barometer of UK consumer sentiment,
                            the Optimism index.

                   More information can be found here:
       https://trajectorypartnership.com/subscribe-to-trajectory/

               You can contact us at the following places:

                 Online: www.trajectorypartnership.com

                     info@trajectorypartnership.com

                        Twitter: @TrajectoryTweet

                                                                             21
You can also read