What is circular procurement?
In simple terms, circular procurement is the strategic purchasing of products or services that align with the principles of a circular economy which include designing out waste, increased productivity gained from materials through keeping them at their highest value for as long as possible, and regenerating natural systems.
Five preeminent circular business models provide suggestions for ‘how’ to be more productive with resources and reduce whole of life impact, including: using circular instead of virgin inputs, sharing platforms, product-as-a-service models, extending the use of products, and extracting value from products at their end-of-use phase.
Some of these business models involve non-traditional ways of producing and consuming products or services. To enable these ‘circular goods or services’ to gain traction in the market, circular procurement involves a recalibration of procurement processes, policies, and tools to assess and recognise the benefits of circular products and services over the whole lifecycle. This is an evolution from traditional procurement which focuses on upfront costs and benefits.
Some examples of products that are designed for minimal impact and value creation across the whole lifecycle include:
- Products with longer lifespans through improved durability or flexibility so that they can be repurposed to meet changing user requirements.
- Products that are easier to refurbish, repair or remanufacture at their end-of-life, including management through a product stewardship scheme.
- Products that use low embodied carbon and safe (non-toxic) materials, such as recycled or rapidly renewable materials, locally sourced materials, and products that are manufactured using renewable energy sources.
- Products consumed through product-as-a-service, leasing, or sharing models that reduce the overall quantity of material required to meet a functional need across multiple consumers.