Market Endurance : A cost-accounting based metric for measuring value retention for the Circular Economy

• The number and diversity of product-level circularity metrics have expanded rapidly in recent years, however, there remains a lack of tools that objectively assess products’ ability to retain their value over time. This paper proposes a simple arithmetic metric—called the Market Endurance (ME) metric—that partially fills this gap by relying on economic value data that can be easily scaled and accessed, that internalizes exogenous influences on product value, and that could be applied by managers with access to commonplace cost data. The metric is applied to a case study that compares eight different product-based utilities including four different furniture products, sold in two different business models. The case study confirms that the ME-metric rewards long lifespans and high-endurance features like repairability, upgradeability, and adaptability. The ME-metric also rewards business models that encourage customers to retain the same product over longer periods of time and utilities that deliver higher value to the end-customer. The metric can be used for cross-product and cross-sector comparisons and can thereby be a catalyst for circular innovation and transition. © 2021 The Authors

Ämnesord

SAMHÄLLSVETENSKAP  -- Ekonomi och näringsliv -- Företagsekonomi (hsv//swe)

SOCIAL SCIENCES  -- Economics and Business -- Business Administration (hsv//eng)

Nyckelord

Circular business model

Circular economy

Endurance

Metric

Slowing loops

Value retention

Publikations- och innehållstyp

ref (ämneskategori)

art (ämneskategori)