Business Models in the Context of a Circular Economy

This chapter delves into the conceptual underpinnings and practical applications of circular business models, which aim to create economic value through sustainable and regenerative processes. Beginning with a comprehensive analysis of the basics of business models in the context of a circular economy, firstly a definition of the circular economy is set, to establish a coherent understanding of the term and its relevance to business practices. Subsequently, the chapter explores various R-strategies, which focus on reducing, reusing, and recycling resources, and demonstrates how these strategies can be integrated into circular business models to bend the value chain. A detailed examination of the business model canvas as a tool for designing and analyzing business models is provided, highlighting its utility in the development of circular ventures. The chapter then shifts its focus to the principles of circular business models and business model innovation. It dissects the components of circular value creation, proposition, delivery, and capture and identifies key circular business model patterns. This section also delves into the mechanisms of circular business model innovation, offering insights into the Circular Economy Business Model (CEBM) Archetypes, the Circularity Deck, and the Circular Business Model Strategy Framework as potent tools for innovating business models in a transition to circularity. The chapter concludes with a methodical approach to implementing circular business models in real-world scenarios, equipping practitioners with actionable strategies for fostering circularity and hereby sustainability and resilience in their organizations.