Impact Investing | January 5, 2023

Three ways product resale is making the circular economy sexy

Maura Dilley and Nicole Bassett

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Guest Author

Maura Dilley and Nicole Bassett

You and me baby, we’re nothing but animals trying to deny our preternatural reuse instincts by confining ourselves to linear economy rules. And it’s just not working! 

So, if your product company wanted to try something new in the, er, boardroom… something bendy but strangely natural… you might be eyeing up the Circular Economy. After all, what’s better than the fleeting satisfaction of one sale? The repeat pleasure of multiple sales! 

At Cascade Circular, we have a decade of experience developing circular supply chains for consumer product companies. We have identified a trifecta of strategic leverage points for turning companies on to the circular economy: circular product design, circular operations and circular data. 

The Circular Economy is broad so for this article, we focus on improving the product resale model – make better, use longer – because reselling instead of manufacturing makes money, not pollution. Resale is a circular business model companies can try out today, for example, one of our clients, The North Face

Our strategic leverage points for investing in resale are non-hierarchical and mutually reinforcing in practice. For your reading pleasure, we rank them in order of sexiness. 

Product design is the ooh-la-la of circular

Oh yes, right there. A circular product does so many things. Its safe material components are designed to be recycled then are built into products designed for emotional and physical durability which at the end of their many, many uses, are cost effectively disassembled and actually recycled into more reusable products. Again! Again! 

To get your circular product on, invest in materials innovation that designs out waste and pollution and regenerates ecosystems through their production. A few examples from apparel and textiles include: climate beneficial wool, closed loop dying, dissolvable thread, and fibers designed to be recycled into more fibers.

Circular operations, or, This top needs a bottom

Circular operations are so hot. Said nobody until they took off those nerd glasses and suddenly, you’re licking your lips for logistics.

Sending products in-and-out and in-and-out of inventory, cleaning them, replacing parts, quality checks, tantric customer engagement, merchandising and balancing budgets in all new places – resale is going to make operations sweat. 

Invest in the systems that will take operations to climax. We’re looking for enterprise software designed for returns and resale; software for managing extended customer relationships and; wait for it, accounting software that adjusts production costs across multiple sales, not blowing it all on the first time. 

Nobody’s doing it right without circular data for lubricant

With a dollop of data, it’s out with the friction and in with the fun. 

Products have the best pillow talk. If you warm them up a bit they can tell you what they are made of, how to treat them right, where they’ve been, where they want to go, which buttons to push, and when. Data can lubricate each step in the circular sales process, capturing, optimizing, and priming success for the next partner in the chain. 

Investors should be hound dogs for digital IDs. These babies enable brands to reduce communication pain points in their circular supply chain by sharing product guidance on how to repair, how to disassemble, material makeup for recycling and critical resale data like original MSRP and photography. 

A circular lens on financial data will help find a new center of balance when accounting for P&L in a circular supply chain.  

Circular feels a little like highschool right now, companies fumbling around in the dark, too bashful to admit it’s their first time and whispering rumors like “Did you know that circularity has three G spots?” (Well, that one is true, folks!)

You heard it from us: invest in products designed to circulate, operations that circulate products and data to caress all those thumping systems into beautiful harmony. 

Good circularity will make us happier people. Practice makes perfect, so don’t be shy, try – and try again.

Maura Dilley and Nicole Bassett are founders of Cascade Circular.