How to become a Green SME in a Circular Economy



how to become a green SME in a circular economy ninety-nine point eight percent of Europe's private companies are SMEs accounting for more than two-thirds of employment in the eu-27 well then as an SME what are you doing to become green how could you become a green SME in a circular economy moreover what is a circular economy a circular economy can be defined as a system in which production consumption and trade are designed to minimize the net extraction of key resources such as fossil fuels raw materials water land the environment and pollutants along with diminishing negative environmental and health impacts this video has been split into three parts firstly what can you do on your own what is in your control secondly what can you do with your business partners lastly what is the European Union doing for you you might have noticed that prices of raw materials are increasing for instance since 2000 metal prices have risen by one hundred and seventy percent rubber has risen by two hundred and sixty percent and many other materials are following suit it's always tricky to put an expiration date on certain resources like there will be no more silver extracted in 15 years yet what is certain is that companies will increasingly have trouble sourcing raw materials at affordable prices you'll need to think about improving processes improving design improving supply chains we are all familiar with the old saying what gets measured gets managed well the first thing to do on your way to resource efficiency is to map your processes what Natural Resources do you use how much do you need where could you improve material flow analysis can help you to visualize the material flows and losses of all your processes take the example of painting a car in an auto repair shop the left side shows the flow of paint before the analysis the red arrows show how much is wasted or lost in emissions out of 10 kilos of paint purchased only one kilo remains on the car the right side illustrates how much of this can be spared if you reduce losses within the paints preparation and application and if you limit overspray you will only need to buy 3.2 kilos of paint instead of 10 material flow analysis is a good way to reduce material energy and water consumption going beyond improving existing processes and redesigning products and systems can bring even greater benefits this is the principle of eco design which is illustrated in the following example a refrigerated truck company managed to reduce the weight of their trucks in semi trailers by 16 percent this brought about other positive changes such as less fuel consumption due to their lighter trucks as the German architect miss van der horse ed less is more better design is another step forward expanding the focus beyond materials eco design considers all the main environmental impacts of a product throughout its life such environmental impacts include co2 emissions soil and water pollution acidification and hazardous wastes based on life cycle analysis eco design also gives you some influence over what will become of your product once it has left the factory or shop eco design can make it easier to reuse or recycle your product at the end of its life for instance one particular company has designed a laptop that when it reaches the end of its life is at least 70% reusable or recyclable this particular laptop was designed with the support of the EU funded zero wind research project clearly redesigning your products and processes to use less material will benefit both the environment and your bottom line however improving your supply chain goes beyond simply reducing quantities better supply is also about identifying the weakest points within your supply chain take rare earth minerals as an example most SMEs as well as their immediate suppliers are completely unaware of to what degree they are dependent on critical raw materials some tools have been developed to help SMEs tackle the issue for instance an example in France can be found at the following address furthermore in a recent report of the European Commission 20 raw materials were identified as critical including cobalt gallium indium tungsten etc use one of these tools to check that your main inputs are not on the list and what if they are well better supply above all means that you should look for substitutes or other sources of supply such as from recycling instead of buying virgin plastic material you could buy recycled plastics instead of buying virgin paper you could buy recycled paper instead of using fossil fuel in your plant you could use renewable energy as for rare earth minerals there is ongoing research and development to find synthetic substitutes to natural elements anyways the changes that you can make will depend on your operations there is no one-size-fits-all solution as an SME you may find it helpful to rely on proven sources to improve your supply for instance if you buy products awarded with third-party verified eco-labels it ensures that you use the greenest products that fit your needs for example the EU eco label covers more than 30 product groups including detergents floor coverings lubricants paper products and more therefore when launching a procurement process to secure your supply you could include environmental criteria let's imagine that you are now fully resource-efficient SME you consume as few resources as possible you design environmental friendly and easy to recycle products all of this as we said is in your control however there are still many areas where you will need a little help from your business partners to make a change by definition you cannot make the change to a circular economy alone a circular economy is all about being open to new business opportunities and there are many ways for you to be part of a broader and cleaner industrial ecosystem you may wish to turn your neighbors into business partners this is industrial ecology turn products you sell into resources you recover this is reverse logistics turn your business model from for sale to for rent this is a functional economy Industrial ecology or industrial symbiosis aims to save energy and resources by transforming one company's waste into another's resource output becomes input in a different part of the ecosystem the most famous eco industrial park in the world is located in kallenberg denmark nowadays it includes nine private and public enterprises which are linked together with other 30 material exchanges for instance fly ash from the power station is sent to a local cement company which turns it into gypsum boards also water reuse schemes have been developed within collenberg together with many other cooperative solutions the eco industrial park of colin borg enabled many economic benefits in environmental savings for example over 240 thousand tons of co2 emissions are avoided each year which is equivalent to the emissions of over 32,000 European people this success is not unique to Denmark and could be reproduced near you have a look at other examples of industrial parks in Europe on the ECAP website at the address on the screen also some country specific initiatives have been set up to connect businesses and shape opportunities to learn about the national industrial symbiosis program in the UK follow this address or this additional address which provides guidance by the French Ministry of sustainable development other interesting information and examples can additionally be found at the EU cluster portal address just as life does not stop at your business's door your business does not stop once your product is sold you may prefer to not think about the future of your products you may think it's none of your business in fact you could be ignoring a profitable opportunity since the resources and the products you sell today can be recovered and recycled into resources for products you will sell tomorrow one option is to create a reverse logistics system on your own where you take back the products that you sell to your customers this may be easier to do if you are operating in a business-to-business operation if for example you provide company offices with homemade apple juice you could take back the empty bottles rather than letting your customer throw them away you could formalize this process through a contract or systems like deposits once you get the empty bottles back you just wash them and reintegrate them back into the supply chain this is a simple case but if your product is more complex or if your business is too small to set up a reverse logistics circuit on your own you can pool resources and have a shared organization that collects and recycles on your behalf the following example from France is a good one six main manufacturers of mobile homes have joined forces to collect dismantle and recycle old homes this reverse logistics system is financed through an environmental contribution of 100 euros for each new mobile home sold now whether you apply reverse logistics on your own or if you partner with similar manufacturers for certain waste flows you don't even have a choice indeed there is a principle in Europe known as extended producer responsibility or EPR according to which you're responsible for the products you place on the market at the end of their life this is the case for a growing number of products including packaging electric and electronic equipment batteries etc under these requirements you have to take back the products you sell yourself or you have to join an organization which takes care of waste collection and recycling last but not least be it mandatory or voluntary be it on your own or with others reverse logistics ensures that recovered resources feed loops that facilitate better supply as was seen in the first part of the video if you start including reverse logistics in your operation your old products don't simply become waste they become raw materials for a new product you are now at the heart of circular economy however revolutionary green you have been so far you may still be selling a product with a functional economy you can go one step further you don't sell your product you rent or lease it to your customers take a German company for instance which provides chlorinated solvents used for high precision metal surface cleaning as this industry sales started to decline in the mid 1980s the newly founded company got the idea to rent their solvent filled containers to their customers instead of selling them this resulted in the short-term closed-loop lending of solvent containers in which their customers were able to rent the containers to clean their metal pieces without worrying about waste disposal the shift to a service-oriented business model made the company a big success story as it achieved a growth in revenues and a decrease in solvents use if you sell your products and take them back as waste as we previously defined as reverse logistics you become responsible for them even after they have been sold to consumers if you rent your products you are going one step further by keeping them as your property this radically changes the way you design your products if you continue owning your products throughout its functional and end-of-life phases you will want them to last as long as possible and you will design them so they have as long a life as possible furthermore in some cases long term rentals and subscriptions can provide a steady stream of income making your monthly accounting more constant and easier to manage the aim of the circular economy is to minimize the net uptake of resources and their associated negative environmental impacts SMEs have a crucial role to play in achieving a circular economy and as you can see there's a lot of work to be done fortunately as the concept of circular economy is rapidly rising on political agendas you will not be alone in Europe just look at what the European Union is already doing for you in July 2014 the European Commission released a general plan targeting SMEs in a green economy the overall objective of the green action plan is to enable SME is to turn environmental challenges into business opportunities it sets out a list of EU actions supporting SMEs in a green economy ranging from green entrepreneurship to access to the markets for green SMEs all in all it provides a favorable environment for green business across the European Union you can learn more about the green action plan for SMEs on the European Commission's website by following the address on the screen you'll also get more information on how the European Commission is addressing the circular economy at this address a circular economy comes with financial incentives of its own as you have seen throughout the video there are many examples of environmental and economic savings resulting from material flow analysis eco design industrial ecology reverse logistics in the functional economy most initiatives can be quickly paid off however even if they should not be the first reason why you should get involved in a circular economy European funding programs do exist you can have a quick overview of funding opportunities within the EU on the ECAP website at the address on the screen there is also a recent video on the euro news business planet channel which is dedicated to EU financial support tools for SMEs that you can watch at this address beyond direct financing there are also plenty of support programs that can help you to achieve higher environmental performance some of them are sponsored by the enterprise Europe Network een a general support for SMEs which offers advice to internationalize your business and assistance to apply for funding opportunities it has close to 600 member organizations across the EU and Beyond including Chambers of Commerce and Industry technology centers universities and development agencies you will learn more on EE ends website at this address in contrast to today's larger linear take make use disposed economy a circular economy represents a great opportunity to transition into a business model that will be more robust and resilient in the years to come there are many initiatives that you can do on your own other initiatives where you can partner with other businesses and finally there are many initiatives where the EU will be glad to support you all what's left for you to do is to get started you




Comments
  1. Can you link the Script Text of the movie. Wie want to translate it into German for educational reasons. THX

  2. i think one of the best things that can help this transition is a service to guide and make aware the consumer to products and businesses that are most in alignment with circular economy in terms of all that they are doing today that they are capable of doing today in alignment with a circular economy, and their intentions to transition as fast as they can. i feel it has to do with transparency.

    so an indexing and filtering of all products and services so consumers can quickly and effortlessly be pointed to what they are looking for and what is of most environmentally and resource friendly. this way what is positive will receive more fuel (customer purchase) and expansion from focus and popularity and ideas and thoughts of a similar direction from the increased exposure and focus.

    another thing is to stop fuelling things that work against and slow down a circular economy and environment kindness.

    and this indexing and filtering service could calculate and quantify environmental and resource impact of products and businesses. with information options ranging from essential to enthusiast to expert.

    also i personally want manufacturing to be custom order-able at an affordable price. i also don't want patents or competition or withholding of information.

    and transportation of goods and services and proximity / accessibility to goods and services is currently a major barrier to fuelling (purchasing goods or service from) people that are most in alignment with circular economy and what is best for all, due to cost and time of shipping cargo and travel. so im guessing the hyperloop (new transport concept) would drastically be in alignment with the circular economy also electric cars.

    but maybe even better would be distributing the ability to do everything we need everywhere that makes economic sense and then just transport information and then the product could be made closer to where it is needed.

    i think starting at designing amazingly brilliant, wonderful and advanced cities in the context of the whole of the globe and population is the most efficient place to start. i think we should dream for some time of the most Utopian / free flowing and evolving systems and cities as if we all can work together and without limitations, so we know what were aiming for.

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