The term “circular economy” refers to a system that uses resources efficiently by reusing materials and reducing the amount of waste produced. This concept has been gaining popularity in recent years, and many companies are now adopting this model.
Circular is in contrast to what right now could be considered a linear economy – we create products, use them, then dispose of them.
Every year, the world consumes some 100 billion tons of raw materials…only 8.6% is cycled back into the economy
Making a Circle of Economy
The circular economy is based on the idea that everything should be reused as much as possible. It’s not just limited to recycling; it also includes other ways of using resources more effectively. For example, instead of throwing out old computers, companies can sell them online and use the money to buy new ones. In this way we take the old linear model and we turn it into a circle of economy.
There are already incredibly interesting circular economy options out there in the world. Just this week I bought jeans and a sweater from Madewell Preloved. By purchasing used clothes, I saved money and kept those items out of the garbage dump (they’re too nice for the dump, I promise). Recently I’ve heard these models referred to as circle fashion and I can’t get enough of the concept!
Another example comes from Burger King, a brand that I wouldn’t normally associate with sustainability. However, they are experimenting with a plan to have customers return their food boxes to be recycled and reused.
What Is The Circular Economy?
The circular economy is based on three guiding principles –
- Eliminate waste and pollution – This begins with design. Most things we interact with in our day to day are designed to be disposed of at the end of their lifecycle. From shoes, to food packaging all the way to the rusted out buildings that cover Detroit, there was no plan for the goods that created these products from the get go, just send them to the dump when their initial use has run out.
- Circulate products and materials (at their highest value) – Re-using products or their component parts is not a new concept. From grade school we are taught to reduce, reuse and recycle. However, the circular economy aims to bring this approach into large scale production. Imagine what would happen if those rusted buildings in Detroit I mentioned, were pieced apart and the wealth of resources that went into building them could find new homes being used for shipping containers, new building projects, and any other number of reuse projects.
- Regenerate nature – The third principle of the circular economy was the least apparent to me, but the most interesting once I understood it. In our linear economy we are constantly extracting value from raw materials the Earth creates. From agriculture to mining, we are always pulling more from the planet. When we instead keep those raw materials in circulation, it leaves more space for nature to grow back where once there was industry.
Why Should You Care (And Other Benefits)
There are several benefits to shifting away from a linear economy, into this new circle of economy. These include:
- helping us reduce our environmental impact
- reducing the amount of energy needed to manufacture new materials
- creating jobs
- more efficient use of resources
- improving the quality of life for people who live in developing countries
All of these exist on the macro level. At the micro level, meaning our experiences and expenses as consumers, participating in the circular economy can mean saving money by purchasing used goods, having continuously fun new things to try- like when you use a shoe subscription, as well as a sense of wellbeing in knowing that your purchases are preventing further harm to the planet and funneling revenue into circular economy projects. Yeah baby, circle fashion!
How Can You Start Participating?
One of the easiest ways to start using the circular economy is by recycling. If you have any old plastic bottles lying around, you can take them to a local bottle bank. Or, you can bring them to a drop off location where they will be recycled into other products. Paper products can also be recycled at drop off locations. Many companies offer free curbside pickup services for recyclables.
If you’re reading this, however, I’d hazard a bet you’ve been practicing recycling for years. To step your game up a bit try looking for apps that are built to support reusing goods such as:
- Poshmark (my favorite option for circle fashion)
- FaceBook Marketplace
- eBay (an oldy but a goody)
My favorite way that I’m participating in the circular economy is with an ETF that invests in companies with a circular economy strategy. This fund is called WWOW – World Without Waste. Now something to note, I am minimally invested in this fund because it doesn’t actually perform in the way I’d like. If you’d like to invest in it, do your research and make sure it’s right for you.
What Does The Future Hold For The Circular Economy? Will It Continue To Grow Or Will It Go Away?
The circular economy has been growing steadily since its inception in the 1970s. However, it is still a relatively new approach to doing business. As more people become aware of the benefits of the circular economy, it is likely to continue to grow.
We know we can’t continue on the way we have been living. Our Earth can’t support a population of this size that is continuously extracting, manufacturing, consuming and dumping. No one knows exactly what the growth of the circular economy will look like, but personally I can’t wait to see it.