Companies and society create preconditions for consumption in circular economy
The product and service design and business models of companies determine the type of goods and services produced. National and, for example, EU-level policies steer production and consumption by means of regulations, financial incentives, voluntary agreements and information guidance.
Consumers, citizens, and public sector suppliers, also have the opportunity to influence the volume and quality of consumption, i.e. what is procured from the options available on the market.
Slow down, reduce, increase value, renew - four principles in circular economy
Business opportunities to circular economy are related to sharing and rental services, repair and maintenance, and enabling reuse.
The first principle is to slow down the cycles. This means that needs are met by using existing products and materials as long as possible. Hence, the need to extract new natural resources is reduced. For consumers this means postponing new purchases and taking care of goods. For producers this means design for longevity, repairability and maintenance services.
The second principle is to reduce the material flows. In production, this could mean product design aiming to reduce the amount of material needed for the product. Service-based business models can also reduce the need for materials. In addition to product and service design, the total amount of consumption is significant, i.e. the consumer's role is to curb unnecessary consumption.
Thirdly, the aim of the circular economy is to maintain and increase the value of goods and materials in circulation. It is a priority to reuse intact products and, secondarily, to reuse and recycle their parts and materials. The reuse of products is supported by peer-to-peer sales (or exchanges) and the reuse services offered by commercial operators, such as antique shops, flea markets and parties selling factory-maintained mobile phones. The aim is to utilise used products, introducing unused goods and materials into the cycle, and utilising products with recycled materials.
The fourth principle focuses on renewal, i.e. improving the state of the environment. An example of this is improving the soil's fertility and carbon stock by means of regenerative cultivation methods. Regeneration takes place especially in production, but consumer awareness of the problems that require regeneration as well as the solutions supports their development and implementation. What is crucial, of course, is the introduction of products that are less polluting to the environment. Households and public consumers play an important role in this.