Colin Kennedy, Sector Manager for Manufacturing at Zero Waste Scotland explores the opportunities for manufacturing businesses on the path to a circular economy.
Scotland is at the cutting edge of developing a more circular economy – designing products and services to keep materials in use for as long as possible – and harnessing the innovation of our manufacturers could realise huge economic and environmental benefits. By adopting circular business models, including asset management, take-back, repair and remanufacture, manufacturers can mitigate their risk and boost their bottom line.
However, a challenge I see when talking to manufacturing businesses in Scotland who are considering a move towards circular business models is their level of perceived risk – of time, investment and reputation. Risk of systemic change in their business processes; changes in the use of materials, how they procure, and fundamentally the way in which their product is made. This makes sense, why change the status quo? If it isn’t broken, don’t fix it. But the model is broken. In the face of resource scarcity, the current linear economic model has a fundamental flaw, in fact, it was never sustainable in the first place – resources are finite, they’ve always been finite, and as our raw materials become scarcer – competition increases and costs rocket.
So, if we acknowledge that action needs to happen now, and that risk is evident in any business decision, “circular manufacturing” should be viewed as an option to alleviate business risk (and soon to become necessity) which brings with it competitive advantage, new revenue streams and increased business resilience. It is certainly a way to “make smarter in Scotland”.
- Design for longevity– changing how products are made (longer-lasting, easier to disassemble and repair, using modular design and regenerative materials) and how they are consumed (leasing or hiring, ‘sharing economy’ models, e.g. tool libraries, replacing a product with a service e.g. music and video streaming service
- Re-use, servicing and repair– extending the lifetime of products by maintaining and repairing them, keeping them in their original use for as long as possible
- Leasing and hiring – retaining ownership of products for long term income flows
- Recycling – separating products into component parts and materials, and enabling those to be reutilised in new products, displacing the use of virgin raw materials
- Remanufacture – continuing the lifetime of products at the end of their ‘first life’ by restoring them to a ‘good as new’ state for their next
Circular approaches are recognised as bringing multi-million pound benefits and providing substantial prospects for job creation and sustainable economic development opportunities. Globally, Accenture values the circular economy opportunity as $4.5 trillion. Our research in partnership with the Ellen MacArthur Foundation and Scottish Enterprise indicates it’s a trillion-dollar opportunity globally, and action across manufacturing sub-sectors (such as machinery and electronics) could generate up to £1.5 billion in cost savings for Scotland alone.
The Scottish Government have set out their strategy for realising this opportunity for manufacturing in Scotland in three key policy documents: Making Things Last, Scotland’s circular economy strategy; Scotland’s Economic Strategy; and, A Manufacturing Future for Scotland – a programme for Government commitment.
At Zero Waste Scotland, we’re implementing these strategies by helping businesses across Scotland to realise opportunities, not only in the manufacturing sector but across the board.
We work with businesses to identify and implement business models that use collaboration and innovation to drive success and growth. Our £18m investment fund and business support service are helping small to medium sized businesses in Scotland pioneer circular ways of doing business. Visit our stand at the Making Smarter in Scotland SMAS conference and attend our workshop to hear more from WHRL Solutions and EGG Lighting, just two of the Scottish based manufacturers we are working with.
We are working with the high-value manufacturing sectors such as aerospace, automotive, electronics, engineering and the medical device industries to truly disrupt the current ‘take, make, dispose’ linear economic model with revolutionary new processes. The recent flagship series of circular manufacturing lectures welcomed business leaders from the world of manufacturing such as HP Inc, Deustche Post DHL and Circular Devices who are already benefiting from embracing circular approaches to manufacturing in their business and shared best practice with over 450 registered delegates across five lectures.
Manufacturing businesses looking to make smarter choices to de-risk their business, should look no further than the circular economy opportunity as a means to “make things last.” With free expert support available from Zero Waste Scotland to mitigate risk in making change – moving the goalposts, challenging the status quo, stimulating new markets and driving new ideas – the time to act is now.
The £18 million Circular Economy Investment Fund, administered by Zero Waste Scotland, offers investment for SMEs based in Scotland and supports work that will deliver circular economy growth. It’s backed by funds from the Scottish Government and the European Regional Development Fund (ERDF).