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The Circular Economy – How to turn waste into gold

by REUZEit Team | Jul 20, 2020 | Circular Economy


We all create a lot of trash. Each of us can throw out pounds of it a day, adding up to hundreds of millions of tons a year in the United States. Some of it gets reused, some of it recycled, but most of it ends up in landfills. The worst part is that much of that waste still holds value. Or, it would if it wasn’t buried under other garbage. And even more of it could have value if manufacturers engineered products with reuse and recycling in mind.

What if things weren’t designed to be thrown away? What if the products we use every day were created to have value even after we are done with them? What if our trash was considered a resource? That is the idea behind the circular economy.

Our cycle of production and consumption has gradually moved from manufacture, use, and dispose to reduce, reuse, recycle. However, this was only a first step towards the more sustainable use of scarce resources. The next step is a circular economy.

A circular economy is an alternative to our current disposable economy, where not only do products lose value as they are used, we are willing to pay additional costs to rid ourselves of them. Instead, the idea of this new paradigm is to use resources so that they don’t lose value as they travel through the supply chain. This is more than recycling. Recycling is the first step, but it doesn’t take into account the next use of the product. Instead, this is a much more radical shift where products are designed with consideration of what they will become after use.

A circular economy is more similar to the way nature uses resources. Nature has no landfill. Everything is continually used and reused with no waste. In a circular economy, the goal is the same. Production levels are reduced to a bare minimum. Once products are used, they are reused as much as possible. They are used again in their current form or broken into component parts for reuse. Once component parts are at the end of their useful life are returned to nature in a way that causes no environmental damage.

How Waste Becomes Gold

This may sound good to those interested in protecting natural resources, but is it good for business when the main goal is profit? Yes, in fact, a circular economy can lead to significant cost savings for businesses, leading to increased revenue. In a circular economy, reusing resources becomes much more cost-effective than creating them from scratch. Because of this, production prices are decreased. Cost savings can be passed along to consumers or retained as increased profits.

How the Circular Economy Works

Since there are no current examples of a fully realized circular economy in practice, it is crucial to consider the principles that would be required for the concept to become a reality.


Reuse products that still have remaining life is preferred over simply discarding them. There may be additional economic gains to be realized from items that still have use. This may require some changes in infrastructure to make this possible. Loop, a new platform focused on zero waste, is already experimenting with reusable packaging for everyday items like detergent, mouthwash, and even ice cream.


Return broken and non-functional products to use through intentional repair programs. There are already local and national initiatives encouraging consumers to take steps to repair broken items instead of merely replacing them. This will take input from manufacturers who often make replacement more cost-effective.


More purposeful attempts to make use of component materials usually turned into waste. This will continue to require research and innovation to find new ways to reuse these materials and also make better use of materials that are more easily recycled.


The first three principles will depend upon intentional changes in design. Changes in product development make reuse, repair, and recycling more straightforward and more economically feasible. For instance, changes in design and material can create products that last longer for more reuse opportunities. They can also make repairs not only possible but more cost-effective than replacement. Finally, material choices have a definite impact on the chances of component pieces being recycled.

Energy Production

In a circular economy where every piece is considered at every stage of the supply chain, it is possible to harness energy from component parts than cannot be reused, repaired, or recycled. Some of this material may be able to be harnessed to create clean, renewable energy.

Products as Service    

When consumers purchase a product, it is often to serve a particular purpose. When it is no longer needed for that purpose, it is usually discarded. Some companies are looking to fill those needs without the need for a purchase. IKEA, known well for inexpensive furniture, is experimenting with a product-as-a-service (PaaS) model where customers will have the option of “renting” their furniture and returning it when it no longer fills their purpose. IKEA can then use its infrastructure to ensure that the item is reused, repaired, or recycled.

Overall Energy Savings

Much of the focus of the circular economy is on the resources that make up the supply chain that goes into the products we use. However, a circular economy also has the potential to provide massive energy savings, reducing our overall reliance on fossil fuels and other non-renewable sources of energy.

Less waste throughout the supply chain through reuse, repair, and recycling will, by definition, reduce the amount of needed production. Since production is one of the most energy-intensive phases of the product life cycle, savings here will have a significant impact on overall energy use.

Connected Supply Chains

To get the most out of a circular economy, we will need to make use of the significant advances that have been made in communications and internet technology. The economical and efficient use of component parts in all stages of the supply chain will rely on improved communications between manufacturers, consumers, recyclers, repair service, product-as-a-service providers, and raw material producers. In a connected global marketplace, the opportunities to turn waste into gold grow exponentially.


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