Within European cities, entrepreneurs engage in private and public collaborative initiatives that work towards reducing local solid waste streams (Futurium, 2019). Furniture and interior design products account for nearly 50% of these waste streams, making them a key priority on the EU agenda to prevent climate change (Vanacore et al, 2021). New legislation to extend producer responsibility and reduce waste incineration is developing on a national level (PBL, 2021) and collaborative initiatives for urban upcycling are emerging (Ministerie I&W, 2023; Futurium, 2019). Business models to support upcycling are evolving, but their configuration and effectiveness is little understood.
Background
Upcycling entails the creative transformation and regeneration of waste material, components or discarded products to equal or higher quality or functionality (Sung et al., 2015; Lüdeke-Freund et al., 2018). Circular business models include “repair and maintenance” (RM), “reuse and redistribution” (RD), “refurbishment and remanufacturing” (RR), and “cascading and repurposing” (CR) and “recycling” models, provided that the resulting material is of higher quality (Lüdeke-Freund et al., 2018).
To identify how circular collaborative initiatives emerge, Prendeville et al. (2021) distinguished between institution-driven (top-down) and social driven (bottom-up) innovation. Bocken and Ritala (2021) proposed six circular business model innovation strategies (Table 1). Open-narrowing strategies (ON) focus on collaboratively developing new technologies and processes. Closed-narrowing collaborations (CN) do the same but internally. In open-slowing strategies (OS) product life times are collaboratively extended, while closed-slowing partnerships (CS) do this internally e.g., through long lasting design and repair. Open-closing strategies (OC) close the loop collaboratively, while closed-closing strategies (CC) do this internally e.g. through take-back plans. Circular innovation strategies (CIS) and circular economy business models (CEBMs) rely heavily on partnerships, and often entail networking across sectors.
Despite growing interest for upcycling collaborations little is known about the importance and motives of partners to engage in CEBMs for urban upcycling. Therefore, this study aims to identify, first, which partnerships occur in CEBM for upcycling of municipal solid waste streams and, second, how these partnerships contribute to the development of CEBMs for urban upcycling.
Method
This study uses a multiple case study method (Yin, 1994) with a sample of twelve cases (Table 1) which was created from a longlist of 150 randomly collected urban upcycling initiatives. The sample was based on maximum variety in relation to CEBM and innovation approach and on availability of data and/or willingness of upcycling entrepreneurs to participate in this study.
Table 1: Selection of upcycling collaborative initiatives based on business model aspects and innovation approach
Case
Description
CEBM type
Bottom-up vs. Top—down approach
CIS
A. ONZE-fabriek
Social guild
CR, RM
Bottom-up
OS
B. Buurman
Second hand DIY store
RR, RM
OS
C. The Substitute
Circular community platform
RR
OS
D. PlanQ
Repurpose projects
CR
OC
E. Tolhuijs
Repurpose projects
CR
OC
F. COOLOO
Furniture refurbishment
RR
OS
G. IKEA Circular Hub
Furniture thrift shop
RR
CC, CS
H. Leolux-Gelderland
Inhouse repair service
RM
CS
I. Bijenkorf- Reliving
On/offline furniture thrift platform
RR
OS
J. Fiction Factory
Production waste repurpose
CR
CN
K. Upcycle Centre Almere
Urban Resource Centre
CR
Top-down
CS
L. Arbeids trainings centrum TIB - Waardering
Social upcycling community
RR, RM
OC
Research data was collected by means of interviews of approximately 60 minutes with key stakeholders of the initiatives. For triangulation purposes additional data was collected from public sources.
Results
We identified four stakeholder types in collaborative initiatives for urban upcycling and their contribution to the upcycling business model by focusing on three main CEBM aspects: value proposition, value creation and delivery, and value capture (Table 2).
This study aimed to address research gaps with regard to partnerships that occur in CEBM for upcycling of municipal solid waste streams and the contribution of these partnerships to the development of CEBMs for urban upcycling. First, we found various types of partnerships in urban upcycling: (1) partnerships with public stakeholders which involve all stakeholder types (2) a wide variety of bottom-up private partnerships, often involving collaborations between local entrepreneurs and larger corporations.
As for the business models, value propositions are largely based on providing services, such as creative-technical capabilities (COOLOO), knowledge (The Substitute, Buurman), creative design skills (Tolhuijs, PlanQ), community or platform access (Buurman, Reliving) or repair skills (Leolux-Gelderland). As for value creation, partnerships focus on availability of material, human and technological resources and innovation capabilities. Although value delivery aspects, such as media coverage and logistics, are frequently mentioned as critical, fewer strategic partnerships occur around these downstream communication and distribution activities. Finally, we found that a wide variety of financial revenue models occur in urban upcycling collaborations.
This study contributes to knowledge on building partnerships for circular economies by focusing on partnerships in CEBMs from the perspective of niche-initiatives. The conclusions of this study are intended to help entrepreneurs to engage partners for accelerating upcycling business models. Moreover, these findings may support policy makers in creating new incentives for stimulating urban upcycling practices.
This study is part of the research project Urban Upcycling (RAAK.PRO04.029) that is co-financed through the Regieorgaan SIA (RAAK-PRO) subsidy scheme of the Taskforce for Applied Research of the Netherlands Organization for Scientific Research (NWO).
References
Bocken, N., & Ritala, P. (2021). Six ways to build circular business models. Journal of Business Strategy.
Lüdeke-Freund, F., Carroux, S., Joyce, A., Massa, L., & Breuer, H. (2018). The sustainable business model pattern taxonomy—45 patterns to support sustainability-oriented business model innovation. Sustainable Production and Consumption, 15, 145-162.
Prendeville, S., Cherim, E., & Bocken, N. (2018). Circular cities: Mapping six cities in transition. Environmental innovation and societal transitions, 26, 171-194.
Sung, K., & Sung, K. (2015). A review on upcycling: Current body of literature, knowledge gaps and a way forward.
Vanacore, E., Rex, E., Talalasova, E., Stewart, C., & Wickman, T. (2021). Circular Economy & the Furniture industry: The state-of-the-art in the EU & Sweden.
Yin, R. K. (1994). Designing single-and multiple-case studies. Improving educational management: Through research and consultancy, 135-155.
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