Awaiting for a Circular Economy: From Scrap Heap to Supply Chain Trailblazer

For a number of reasons, circular supply chains will take the place of linear supply chains in the upcoming years. The key to constructing this economy is to keep items, equipment, and infrastructure in use for extended periods of time, increasing the value of these vital resources. The circular supply chain is a business concept that promotes product manufacturers and dealers to repurpose abandoned materials.??

The traditional "make and throw away" mindset is a financial trap that costs businesses money as they deal with unpredictable demand and escalating raw material costs. Instead of creating single-use products, businesses are fixing abandoned components or dismantling objects to restore them to their fundamental material form.

??Reduces Environmental Impact

There is a transition from raw materials through the production process through distribution to the consumer and eventually to waste in a circular supply chain, with today's emphasis on sustainability and recovery of discarded resources. By using the reverse logistics method, materials and goods that were intended for the trash may be given new life.

??More Options for Saving Money and Streamlining Growth

At first glance, the circular supply chain seems to be only a way for companies to reduce their environmental impact, but it is much more than that. By recycling parts and materials, businesses may get the most value out of the raw materials they purchase. When something has reached the end of its useful life, it can still be used in a profitable way at a lower cost than having a new one made.

??Build Consumer Loyalty

Consumers have begun to favour firms with better ethical profiles — those that have strong environmental and social corporate strategies — as environmental concerns have grown. Green influence is the newest craze, and customers want to know how their products were made and what impact they have on the environment.

How to Implement a Circular Supply Chain?

Companies must consider 4 primary criteria when developing a traceability strategy that supports circularity.

??Identify Market Dynamics

Supply networks must be flexible and dynamic in order to adapt swiftly to changing demand. In the procurement process, strategic sourcing is critical. It's critical to have a predictable sourcing strategy in terms of manufacturing, shipping, warehousing, and distribution. Relying on the traditional linear supply chain is no longer going to help us leap ahead. The supply chain market needs a circular supply chain that keeps in loop sustainability along with cost reduction & agility in production.?

??Define Business Goals

The supply chain's major goal is to meet demand, increase customer value, enhance responsiveness, promote financial success, and create a strong network. Today's customers are more and more concerned about sourcing. So, it's high time for companies to shift their goals towards ethical sourcing. Reducing waste and turning the supply chain operations into a circular economy should be the priority of supply chain leaders in the post covid era.

??Prioritise Data and Pick the Right Tech Stack

Companies are fast identifying information flow limitations with homegrown technologies. Visibility into supply chain operations is typically hindered by incompatible systems and software. Driving a data-driven supply chain is very crucial to augmenting traceability in the supply chain.

With the right supply chain technology, your business can improve supply chain visibility, gain better control over inventories, save operational expenses, and ultimately outperform the competition. Every business has to concentrate on ERP integration as its first move going forward.

??Partner with a 3PL service Provider

Partnering with a reputed 3PL provider is going to help you in the long run to achieve success and customer satisfaction. The supply chain is a network. Building a strategic partnership that helps you attain last-mile transparency is inevitable.?

Many government institutions have started implementing rules and regulations governing recycling and trash disposal, pressuring firms to implement the circular supply chain. Finding ways to recycle products, components, and materials rather than having them end up in landfills after their first usage has become a strategic commercial priority. It has become a vital requirement for customers, consumers, and regulators, as well as a strategic differentiation to embrace a circular model to contribute to the national supply chain sustainability.?