Philips, Patagonia and Unilever shows us value in the circular economy

Make no mistake about it. The circular economy is a global growing concept receiving nods. It encourages businesses to look at themselves, find a way to create zero environmental impact, and reduce taking resources from the environment. And many companies have already shown us that it is possible to make the switch permanent from a linear economy.

We will introduce three quick examples of the biggest brand in the world. These brands are a few of the biggest names contributing to a circular economy and promoting ethical consumption.

Philips: business models in a circular economy

Koninklijke Philips N.V. is a role model for businesses in terms of displaying commitment towards contributing to a circular economy. We are not just talking about making a switch to LED lights. We are talking about a whole revamp of their business model to pursue a circular business.

Instead of selling bulbs to customers, its Philips Circular Lighting model installs lighting for customers while also providing maintenance service. This service, Signify, sees the shift from selling hardware like light bulbs to providing a lighting service, also known as Product as a Service (PaaS). Customers pay for what they use, while Philips is in charge of manufacturing hardware, providing lighting, and, especially, repairing to extend product life.

Furthermore, the lighting hardware itself can be reused (and even upgraded) when a contract ends. Philips can also determine when to retire damaged products and then recycle the materials properly. This minimizes the negative impact on the environment, even closing the loop by returning the materials to the manufacturing processes. It’s also beneficial to customers as they may not know how to discard e-waste properly.

Patagonia: product life extension in a circular economy

Patagonia is one of the first movers in creating a sustainable company. The clarity of its purpose is one of the reasons for its popularity among the youths. The company is not only putting money where its mouth is, but it is also putting in passion. You can see it in their innovative products like their sustainable beer, Long Root Wit, or activism activities like supporting youths in climate education.

A powerful theme from Patagonia’s services is “repair.” Fashion is one of the biggest polluters on the planet, and Patagonia is tired of it. Behind their push as a sustainable fashion brand, Patagonia is challenging consumerism by extending the lives of their products. They even put out ads with the catchline, “Don’t buy this jacket” (“this” referring to their Patagonia jacket,) reminding all about responsible consumption.

Through their Worn Wear service, not only does Patagonia encourage its customers to bring in their damaged Patgonia clothes for repair, but it also offers customers a trade-in option. The old clothes are then cleaned for second-hand sales or even upcycled to make new clothes. Patagonia even conducted a Worn Wear College Tour in Japan, where they went around Japan university campuses to repair students’ clothes for free.

Patagonia is clear: we can buy less, still meet clothing demand, and ultimately be kind to the environment.

Unilever: helping customers join the circular economy

Unilever is committed to being part of the circular economy. Many products under its catalog use plastics, so it drives them to use recycled plastics for their containers, or even reduce and eliminate plastics. They are also focusing on developing technology to create plastics that can be recycled hundreds of times.

But businesses are only one part of the equation. Unilever appeals to the customers to be part of the solution too. To do so, Unilever makes it attractive and hassle-free for customers. For example, in Chile, South America, a three-wheel electric vehicle goes around selling refills by weight for their detergents. A similar sell-by-weight system is available in Philippines’ shopping malls, where Unilever also has staff to provide hair care with their shampoo products.

Unilever also focuses on design so that customers will find it easy to sort and recycle their products. They work with governments and government agencies to develop infrastructures in garbage collection and recycling of waste.

What does it come from, what happens after

Taking care of “what happens after something is used” is an important mindset, be it an organization playing a part in a circular economy, or an individual leading an ethical consumption lifestyle. We see this mindset excellently executed in these three companies. More innovative business models and technology will undoubtedly develop as the world calls for more ethical products and services.