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Reuse and refurbishment of products present a substantial business potential in the near and medium-term future. These approaches are not new, but a newly dedicated focus will both benefit the planet and offer new economic opportunities. Current circularity activities in the building industry are primarily focused on the maintenance, repair, and sales of spare parts. These practices are often viewed as necessary bothers or legal obligations rather than strategic business decisions. This is about to change. In this blog, Mirko Sauvan, Sustainability Manager at Swegon explains how.
The economic system has, more or less up until today, been optimised for a linear approach of make, use and waste, but it is currently shifting towards a more circular model as environmental considerations start to affect companies' financial performance to a greater extent. To reuse and refurbish existing products is a promising approach for many companies, especially for high-quality and complex products, but existing practices are often at pilot level, and they are therefore usually not yet suitable for large-scale implementation. The reason for this can include legislative uncertainties, practical obstacles, limited customer demand as well as technical and economic complexities.
Circularity initiatives in the UK
With the European Union supporting circular business models through initiatives such as European Green Deal and Circular Economy Action Plan, the UK is setting its sights on a sustainable future through with the Maximising Resources, Minimising Waste government plan. This plan, coupled with the UK's establishment of the world's first UN-backed centre for circular economy research, demonstrates a strong commitment to advancing circular economy principles.
These initiatives have come amidst a shifting market landscape, with increased competition in the circular product market and a growing availability of "second life" and longer-lasting products. As companies adapt, there is a growing emphasis on incorporating "design for disassembly" and other circular design strategies into product development, ensuring their long-term viability in a circular economy framework.
Interest and demand is growing quickly
A growing number of environmentally conscious consumers are actively seeking solutions to minimise their environmental impact, they are willing to increase their consumption of resold products and rental services instead of buying new. By incorporating reuse and/or refurbishment concepts into market offers and operations, customers can easier evaluate and moderate their environmental footprint. It is inescapable to, at least, touch upon how businesses may be affected by this new customer demand. A side from the likely major changes to the traditional way of making business, new customers are potentially attracted, and the brand can potentially gain further value in the eyes of various stakeholders.
However, companies and customers face challenges in finding one another in the transition towards circular offers and consumption. Limited knowledge and a lack of mutual understanding between corporate businesses and customers, of how difficult it is for companies to leave the linear way of doing business behind, create a chicken-and-egg dilemma which requires information and communication.
RE:3 – a circularity concept
With the above known, our traditional offer of indoor climate solutions has been complemented with the RE:3 concept. It consists of three key principles of circularity with the aim to reduce the embodied carbon for heating, ventilation and air conditioning (HVAC) in buildings. The three principles are RE:duce, RE:use and RE:vitalise where RE:duce is focused to decrease the carbon footprint by the means of alternative materials. Even design adaptations to minimise the need for carbon intensive materials goes under RE:duce. RE:use involves a business model for take-back and resell of modernised products, while RE:vitalise gathers onsite updates for product life extension.
RE:duce should not in any way be described as an easy path to reduce the level of embodied carbon in buildings. However, the supply of low carbon materials is growing and fairly hands-on methods can be utilised to evaluate different alternatives’ effects on functionality, footprint etc. RE:vitalise has perhaps the high potential of reducing embodied carbon within the RE:3 concept as it, in our case of HVAC, allows for our indoor climate related products to stay in their current position and be updated and modernised for a continuous service life. Since the additional lifespan of operation can be 10 to more years, it must be considered a highly promising method of circularity.
RE:use on the other hand is a more complex part of the concept. To develop the business models related to create a reverse product flow and ensure sales of modernised units on a large-scale that meet the requirements of long-term existence of the business, involves numerous considerations. To join the Circularity Development Program led by a team from Combient Pure was not one of those tricky considerations. The carefully designed development sprints and peer-to-peer learnings brought back great learnings and ideas for the formation of our RE:use method.
All in all, the RE:3 concept is a response to clear market signals and prepares us for a circularity transformation and for upcoming legislations. It supports our customers in their pursuit to tackle environmental challenges related to embodied carbon emissions and it allows them to improve their commercial offers and brands with sustainability values. At the end of the day, for many people to feel good inside.
