Circular economy: what it is and how to apply it to your business

Did you know that up to 700,000 jobs could be created in the European Union by 2030 thanks to the circular economy?

And that the potential for cost savings on materials for fast-moving consumer goods worldwide is estimated at $700 billion?

This economic model is not just a trend, but a true transformation in the way companies operate.

Do you want to know how to implement a circular economy in your business and enjoy all the benefits of this sustainable practice?

Read on to find out.

Main Points

• The circular economy seeks to minimize waste and maximize the use of resources.
• THE implementation of circular economy can reduce costs and create new business opportunities.
• Keeping materials, products and components in continuous use cycles is the central objective.
• Recycling and upcycling are fundamental practices for the circular economy.
• By 2030, the circular economy could create 700,000 new jobs in the EU.

What is a circular economy?

The circular economy changes how we manage resources.

It seeks to reduce waste and use more materials.

In 2010, 65 billion tons of raw materials entered the economic system.

By 2020, that number is expected to reach 82 billion.

This circular economy aims to create more sustainable systems.

She wants to keep products and materials in use for longer. This helps reduce waste and promote reuse.

Practices such as waste prevention and reuse have a big impact.

They can bring huge benefits to the economy. For example, they could save EU companies €600 billion.

Furthermore, the circular economy can create 170,000 jobs. This shows the strong link with sustainability.

Managing resources efficiently is crucial for the circular economy.

It can reduce greenhouse gas emissions by 2 to 4%.

Furthermore, collecting 95% from mobile phones in the EU could save over a billion euros.

The annual waste production in the European Union is 2.1 billion tonnes.

In 2022, each European citizen consumed 14.9 tonnes of raw materials.

The circular economy aims to make the EU climate neutral by 2050.

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Differences between circular and linear economy

THE comparison between economic models of linear and circular economy shows big differences.

The linear economy uses natural resources, produces on a large scale and discards without thinking about the future.

This degrades the environment and depletes resources.

The circular economy, on the other hand, seeks to use resources efficiently.

It encourages sustainability and recycling. This not only protects the environment but also creates new job opportunities.

In the linear economy, many products have a short lifespan and generate a lot of waste.

The circular economy aims at “Cradle to Cradle”, where everything can be reused.

Companies like Lárifer and Nespresso are successful examples of using recyclable materials.

Another important point is the recycling vs. disposal.

The circular economy promotes recycling, reducing gas emissions and protecting biodiversity.

This brings benefits to the environment, the economy and society.

Circular economy in the business context

THE circular economy in companies is essential for anyone who wants to be sustainable and efficient.

By 2024, many industries such as fashion, technology and manufacturing are using new technologies.

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This helps extend the lifespan of products and reduce the impact on the environment.

This model replaces traditional production with a system that values reuse and recycling.

Technologies such as IoT allow monitoring operations in real time.

This helps to identify, for example, equipment that consumes a lot of energy.

The use of blockchain It also guarantees transparency and traceability in products and materials.

Business management systems like Sage X3 improve inventory management.

This helps to avoid waste.

Effective omnichannel operations also improve the consumer shopping experience, aligning sustainability with social responsibility.

Adopt the circular economy in companies brings many benefits. Companies that do this gain customer loyalty.

This is because they align their operations with the values of conscious consumers.

Environmental responsibility and operational efficiency are essential for long-term success.

In different parts of the world, plans for the circular economy are being implemented.

In Europe, the European Commission and the European Green Deal have established guidelines.

In Portugal, the National Action Plan includes actions at different levels, adapted to regional needs.

Innovation in sustainability is a necessity for business growth.

Adopting sustainable practices brings significant benefits. This shows the importance of the circular economy in all business sectors.

How to apply the circular economy to your business

Adopting circular economy strategies is essential to transform businesses and reduce waste.

The National Confederation of Industries (CNI) shows that 881% of Brazilian businesspeople see the circular economy as crucial for industry.

Law No. 12,305/10, the National Solid Waste Policy (PNRS), motivated many companies to adopt sustainable practices.

They began recycling and transforming effluents and waste into nutrient-rich organic fertilizers.

An example of positive change is reverse logistics. It is mandatory for tire, battery and electronics industries.

This shows everyone's responsibility for the product life cycle.

Using renewable energy, such as wind or solar, also helps a lot.

Reduces costs and contributes to the circular economy, reducing greenhouse gases.

The Circular Economy has the potential to generate a global economy of up to US$4.5 trillion by 2030, according to Accenture’s “Circular Economy Handbook” report.

Brazil is the fourth largest producer of plastic waste in the world, losing 11.3 million tons of plastic waste every year.

Only 145 thousand tons are recycled, which represents 1.28% of the total.

With improved circular economy practices, the country could earn R$14 billion annually from reusing waste.

Companies like Ambipar are focused on sustainable innovations.

They create feed from crustacean remains and soaps made from collagen capsules.

Investing in the circular economy is an economic opportunity.

Studies show that sustainable brands grow 50% faster.

They account for more than 60% of total company growth, according to Unilever.

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Conclusion

The circular economy is essential in a world with 2 billion more people in the next 30 years, according to the UN.

This growth demands a new model, different from the linear one that harms biodiversity and depletes resources.

The circular model brings benefits such as fewer gas emissions, less food waste and up to 30% in energy savings.

Organizations like the Ellen MacArthur Foundation are promoting the circular economy.

In the fashion and food sectors, which generate 92% of environmental impact, adopting circular practices could create 200 million jobs by 2030.

This shows the importance of environmental innovation for the competitiveness of companies.

Adopting the circular economy also improves customer relationships.

Research shows that 72,413,000 companies have seen an increase in consumer loyalty.

In addition, 47.3% improved operational efficiency and 75.9% reduced costs.

The advantages are clear, positively impacting the environment and society.

Written by Andre Neri Updated on January 16, 2025