HomeBUSINESSCircular Economy: Consumer Sees Companies As Being Forced To Act

Circular Economy: Consumer Sees Companies As Being Forced To Act

Circular Economy: According to a new study by Capgemini, almost half of consumers are convinced that companies have not yet implemented, enough measures for a circular economy.

  • A new study by Capgemini: seven out of ten consumers in Germany want to change their consumption behavior to be more environmentally conscious.
  • Almost half of the consumers believe that companies are not implementing enough measures to enable a circular economy.
  • In particular, the inadequate labeling of products (60 percent) and high repair costs (55 percent) prevent consumers from buying sustainably.

Growing environmental awareness and concerns about waste and depleted resources mean that more and more consumers are turning to sustainable consumption. More than seven out of ten consumers  would like to change their consumption behavior accordingly. This emerges from the new study “Circular economy for a sustainable future: How organizations can empower consumers and transition to a circular economy” by Capgemini Research Institute. To this end, consumers are increasingly turning to companies that rely on the circular economy principle. However, almost half believe that companies are not doing enough to recycle, reuse and reduce waste.

Circular Economy: High Demand For Sustainable Products

For the study, the Capgemini Research Institute surveyed more than 8,000 consumers in 14 countries worldwide, including 757 people in Germany. It shows that consumers want to consume more sustainably, for example, by reducing their overall consumption (54 percent), buying longer-lasting products (72 percent), or having products repaired and serviced to extend their lifespan (70 percent). Sixty-seven percent expect companies to advertise their products responsibly and not encourage excessive consumption.

Earlier research by Capgemini shows that companies have so far failed to establish the circular economy model, which closes material cycles as much as possible. The study “Sustainability in Consumer Product and Retail” from 2020 shows that only 18 percent of executives from the consumer goods and retail sectors have invested in circular economy initiatives. And in the study “The Automotive Industry in the Era of Sustainability,” 52 percent of the automotive companies stated that the most frequently used sustainability initiative was promoting a circular economy.

Circular Economy: Focus On Food And Plastic Waste

At the same time, more and more consumers are turning to companies that have developed a sustainable business model. This is especially true in areas that consumers are already highly aware of, such as food and plastic waste. In the past twelve months, 44 percent of consumers have increased their spending with food and beverage manufacturers who focus on recycling, reuse, and avoiding waste. Forty percent of consumers have done this in the personal and household care products sector.

Overall, however, 49 percent believe that companies need to take further measures in recycling, reuse and waste reduction. A lack of willingness to act can also develop into a reputation problem for companies: More than half (51 percent) of consumers currently have no confidence in the sustainability promises made by companies.

Remove Obstacles: The Focus Is Currently On The Reuse Phase

Consumers feel constrained in making more sustainable consumption choices in terms of convenience, access, and cost. Three out of five (60 percent) reason that product labels do not contain sufficient information, for example, about the origin, recyclability, or recycled content. For 55 percent, high costs for the repair of products represent a hurdle. And more than half (53 percent) state that they do not want to compromise on convenience.

To extend the life of products, there are already regulatory efforts such as the EU initiative “Right to Repair.” In addition, companies should take further measures to make their product portfolio more sustainable and enable environmentally conscious consumption. At the moment, consumers are mainly focusing on the post-use phase in their behavior. For example, 58 percent of consumers state that they separate food waste – in Germany, as much as 69 percent.

However, only 48 percent of the  respondents buy food with as little packaging material as possible. This could indicate a limited selection of sustainable products that are available to consumers. While responsible disposal is key to the circular economy, more efforts are needed to ensure that waste does not arise in the first place.

A Circular Economy Supports Sustainable Growth

“The circular economy is the key to sustainable growth. Consumers are already doing their part with their behavior, but they can only choose from a small number of offers. Therefore, it is up to industrial companies to develop products with a more sustainable life cycle,”.

“To do this, they have to initiate a profound change in three areas: the minimization of the CO2 impact of their existing products and services, a product design that takes the principle of the circular economy into account from the start, and the establishment of a sustainable business strategy for the entire company. Companies that successfully implement this transformation will be among the market leaders of tomorrow and can secure the loyalty of their customers. On the way to more sustainability, the circular economy is an investment in the way we want to do business in the future. “

Establish A Business Model Based On The Circular Economy

In contrast to the linear economic model “take-make-waste,” the circular economy is regenerative. The model aims to decouple growth from the consumption of finite resources gradually. For consumers, this means buying durable products that are recyclable or made from recycled materials. In addition, to keep them in use for a long time through effective maintenance and repair. And to dispose of the products at the end of their service life, so that little or no waste is generated.

To meet consumer expectations, companies should develop products and business models that are designed to avoid waste. In addition, they should reduce their raw material consumption and plan for the return and recycling of products and packaging. Capgemini has identified vital actions companies can take to implement successful circular economy initiatives:

  • Product development according to the principles of circular design
  • A radical rethinking of business models
  • Rethink value chains to close the loop
  • Enable sustainable practices for consumers
  • Create organizational prerequisites that support the transition to the circular economy model
  • Use new technologies to promote a circular economy strategy
  • Collaboration to Accelerate Progress


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