Circular Procurement Partnerships

Trend Definition 

What is the essence of this trend? What is its impact? 

• Essence: Circular Procurement Partnerships embody collaborative efforts between multiple companies along the supply chain to implement circular economy strategies 
• Impact: These partnerships drive circular practices, transforming traditional procurement into a strategic function, ensuring sustainability and circularity across the entire supply chain and fostering knowledge exchange between businesses

Trend Drivers 

Why is this trend emerging now? What’s changing? 

• Sustainability Imperative: Businesses respond to a heightened sustainability focus, recognising the necessity of eco-friendly practices in their activities and processes 
• Regulatory Pressures: Upcoming regulations require businesses to reduce their carbon footprint and embody a certain share of recycled content in their manufacturing operations 
• Innovation in Technology: Technological advancements, for example, in manufacturing technology or connectivity, enable businesses to work together closely along the entire supply chain

Use Cases 

How to apply this trend? 

• Packaging Transformation: Establish a circular network 
  Example: Terracycle's Loop alliance, featuring industry leaders like Coca-Cola, fosters circular practices by collecting packaging, cleaning, and returning it to manufacturing companies to refill, enabling procurement teams across the entire supply chain to benefit from circular packaging 
• Automotive Network: Collaboration of players from every step of the supply chain 
  Example: Catena-X is an automotive network that fosters circularity through information exchange. This enables procurement teams, for instance, to receive information on the battery they procure

Procurement Relevance & Response Strategies 

How should Procurement adapt its Processes, Organisation, and Strategy?

• Supplier Collaboration Programs: Procurement teams should initiate programs with suppliers on circular initiatives, like material take-back schemes or joint development of recyclable products 
• Supplier Audits for Circularity: Conduct regular audits of suppliers to ensure compliance with circular economy principles and practices