Circular Economy

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BONN: DHL has published ‘Delivering on Circularity’, a white paper explaining how the application of circular economy principles in the fashion and electronic sectors can help reduce their use of water and waste generation.

According to the company around 20 percent of finished garments are never used, smartphones are often exchanged after just two or three years and both sectors combined contribute more than six percent of global greenhouse gas (GHG) emissions.

The industries also use more land than the area of Germany and Switzerland; require water equal to 40 percent of US citizens' consumption; and generate enough waste to equal 50 percent of the European total.

With 80 percent of emissions from an average fashion or consumer electronics item accrued during production, DHL's white paper has identified three core enablers and 10 building blocks that allow for a successful transition from supply chains to supply loops.

They range from innovative materials and design to on-demand production, smart product returns, reusable packaging, new use concepts, and asset collection and recycling.

The company says consumers need incentives to encourage circular behaviour and supply chains must be redesigned: “The shift toward circular consumer behaviour is a critical driver of a successful transition to circularity,” says Carsten Lützenkirchen, DHL senior vice president Customer Solutions & Innovation. “Novel circular business models not only diversify product and service portfolios but have a positive effect on customer engagement. It is a classical win-win situation in which sustainability drives growth and innovation.”

DHL suggests that if all fashion and electronic industry stakeholders accelerate a mutually reinforcing loop, circularity can become a reality with logistics a “natural backbone”.

Circularity changes the way materials and products move – from a straight line to a regenerative circle – and efficiently managing the flow of goods is what logistics is all about, adds company CCO Katja Busch: “Simply put, circularity is about the 5Rs: Reduce, Repair, Resell, Refurbish and Recycle. The transition toward a circular economy is built on the redesign of supply chains.”
 
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