A push toward embracing the circular economy has helped propel companies toward making more sustainable choices that help protect the environment and even their own bottom line.  

While we have relied on a “take, make and dispose” model since the dawn of the industrial revolution, that method of doing business is no longer sustainable and faces major challenges. Resource depletion has become a legitimate concern, as has the soaring prices of our natural resources.  


The circular economy is an economic model that is important for American and global businesses moving forward.  


But what is the circular economy, and what does it mean for your company? To explain the circular flow of economy, it’s important to begin with how it works.


The Definition Of A Circular Economy


Explain The Circular Flow Of EconomyThe circular economy focuses on eliminating waste and the unnecessary use of resources. Its goal is to use as few resources as possible by keeping materials in circulation and getting the greatest value from them. It is a restorative or regenerative model that redefines growth. 


Although the circular economy can be applied to many different industries in many different ways, no matter what industry it is applied to, the concept is circular in design and works to design waste and pollution out of a system while keeping products and materials in use. 


Rather than rely on a take-make-dispose option, companies that incorporate a circular economy into their management instead operate under a make-use-return approach. This not only keeps materials in use indefinitely, it also eases the burden on our natural resources. 


The Ellen MacArthur Foundation has been instrumental in promoting the idea of a circular economy. The foundation, which works with businesses and policymakers, estimates that if companies focused on building circular supply chains, more than $1 trillion a year could be generated globally by 2025, along with 100,000 new jobs in the next few years. 


Why is this important? The United Nations projects that by 2025, 1.8 billion people will be living in countries or regions with absolute water scarcity. At the end of 2010, there was just enough natural gas in proven reserves to meet 58.6 years of global production. And the Global Phosphorus Research Initiative predicts we could run out of phosphorus in 50 to 100 years unless new reserves of the element are found.


How The Circular Flow Applies To Your Company


Often how the circular flow of economy applies to your company is dependent on the sustainability goals you have set. There are many ways companies have applied circular concepts to their business models. Here are a few examples:


  • Explain The Circular Flow Of EconomySubaru hasn’t sent any waste from its two manufacturing plants in Japan to landfills in almost 15 years. The benefits of zero waste extend here to the United States as well. The company’s U.S. plant in Indiana estimates that while its zero landfill program costs about $7.5 million, the company receives roughly $11.5 million in benefits, making this a financial and environmental success. 

  • Procter & Gamble is working toward the goal of ensuring 100% of its packaging will be recyclable or reusable by 2030. It has also reduced virgin petroleum plastic in packaging by 50%. Some products, like Old Spice and Secret, are among the first to feature all-paper tube packaging that is made from 90% recycled paper.

  • Google has diverted all of its waste from landfills at six of its data centers. These centers have also worked to improve server management and to further extend the life of items so fewer waste ends up in landfills.

    • Walmart began salvaging and reusing parts in an effort to reduce the need to order replacement parts. Catalogued parts are sent to a central warehouse and then used to repair other in-store refrigerators around the country. 


Once you have a better idea of ways you can apply circular economy concepts to your company, you can develop a sustainability plan that outlines how your company plans to achieve these goals.  


Keep in mind that developing a sustainability plan that includes measurable goals is essential to demonstrating success. If you incorporate milestones that demonstrate success, you are much more likely to achieve your goals. 


To create a sustainability plan that reflects how your company will incorporate a circular flow of economy, ask yourself questions like:


      • What is your mission?

      • How is your business structured or organized?

      • Do you have the right staff in place to accomplish your goals?

      • Do you have sufficient financial resources in place?

      • What obstacles do you anticipate you will need to overcome? 


You can read more about how to develop a sustainability plan in our article, What Is A Sustainability Plan?


At The Forefront Of The Circular Economy Push


One of the areas that the circular economy concept has had the largest impact in is waste management. If your company is part of the industrial sector and regularly generates solvent waste, incorporating circular economy concepts in this area of your operations is worth taking a closer look.  


As a generator of solvent waste, you’ve likely heard of fuel blending, which is a common method used that takes spent materials and converts them into a fuel source for a different manufacturing process. Fuel blending is a form of open loop recycling because it delays the disposal of materials by manufacturing goods and spent materials into new raw materials.  


To incorporate more circular economy concepts into their waste management practices, more companies are instead turning to closed loop recycling. This keeps materials at their highest utility and value by indefinitely recycling the material without degradation of properties. 


Here’s how closed loop recycling looks in practice. At Temarry Recycling, the company’s Treatment, Storage and Disposal Facility (TSDF) just across the U.S.-Mexico border embraces the concept of zero waste. Using a closed-loop process, Temarry takes an existing physical product (industrial solvents) and recycles them with useful waste byproducts. This make-use-return approach looks like this:

Explain The Circular Flow Of Economy

        • A waste to energy process converts high BTU organic solids to steam to be used as energy on site. The use of solvent distillation then takes the steam from waste to energy and uses it to power the recovery stills.

        • Through distillation, spent solvents are re-manufactured and sold back into industry for their original solvent properties.

        • Temarry’s facility also extracts usable water from industrial hazardous wastes that include acids, bases, coolants, oily water and latex paint. 

        • Treated water is used onsite for industrial needs, including the waste to energy equipment and cooling tower.


Benefits Of The Circular Economy


In addition to preserving natural resources and keeping materials in use indefinitely, taking advantage of circular economy concepts like closed loop recycling offers these four additional benefits: 


            1. Reduced costs - Some worry that implementing sustainable practices that contribute to a circular economy will eat into profits. In reality, sustainable business practices create efficient operations and by conserving resources and enhancing productivity, costs are reduced.

            2. Lower carbon footprint - For companies located on the West Coast, sending their solvent waste to Temarry Recycling’s Treatment, Storage and Disposal Facility just across the United States-Mexico border versus cement kiln facilities in the Midwest reduces the amount of diesel fuel required for transportation. Transportation alone across the United States can produce more than 1,500 kg of carbon dioxide. This reduces not only a company’s carbon footprint, but transportation costs as well. 

            3. Reduced cradle to grave liability - An EPA-authorized exporter of hazardous waste, Temarry terminates the original generator’s cradle to grave liability when the waste is exported into Mexico. As the importer of the hazardous waste in Mexico, Temarry becomes the generator in a new cradle to grave liability chain of custody.

            4. Improved image - Today, consumers are more educated and care about the influence of their purchasing power. A Natural Marketing Institute survey found that nearly 60% of consumers are more likely to purchase goods and services from a company that incorporates sustainable practices. 


By investing in technologies that promote a circular flow of economy, companies create a bright and competitive future for themselves. This is a viable and smart choice for increasing your company’s level of sustainability while preserving the environment and the earth’s natural resources for centuries to come. 


Are you Recycling or Fuel Blending


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