Circular Procurement Research Articles

The critical role of procurement in the emergence of circular business models: Insights from multiple cases of Vietnamese manufacturers

AbstractWhile recent literature acknowledges the role of procurement in circular business models (CBM), a comprehensive exploration of its potential contribution remains scarce. This study delves into the under‐explored role of procurement in advancing CBMs within organizations. Employing a multiple case research design focused on four Vietnamese manufacturers, the research unveils procurement's distinctive contributions to CBM implementation. Emphasis is placed on supporting recyclability, reusability, waste reduction, and ethical standards aligned with competitive strategies. The study introduces a circular procurement framework, demonstrating its potential to drive CBM adoption. Theoretical contributions involve applying CE and CBM theories to procurement, identifying its role in CBM organization, uncovering barriers, and linking them to organizational context and financial considerations. In terms of practical implications, the research provides managerial guidance, emphasizing the pivotal link between procurement and CBM success, offering actionable insights for effectively navigating challenges, and fostering a culture of sustainable circularity within manufacturing businesses.

Investigating circular procurement management and sustainability performance: The interactive moderating effects of digital traceability and collaboration

Whether and how manufacturing firms can enhance their overall sustainability performance through the implementation of circular procurement management is still unclear and under-researched. Drawing on the socio-technical systems theory, this study develops a theoretical model and explores the potential impacts of circular procurement management on manufacturing firms’ sustainability performance (i.e., economic, environmental, and social performance) while examining the moderating role of digital traceability and collaboration. Based on survey data from 250 Chinese circular economy manufacturing firms, this study uses hierarchical regression to analyze the impact mechanism and boundary of circular procurement management on sustainability performance. The empirical results show that (1) Circular procurement management in manufacturing firms can significantly improve economic, environmental, and social performance; (2) Digital traceability positively moderates the effect of circular procurement management on both environmental and social performance; (3) Collaboration positively moderates the effect of circular procurement management on both economic and environmental performance; and (4) The impact of circular procurement management on environmental performance is positively and interactively moderated by digital traceability and collaboration.

Unveiling the circular procurement Nexus: A hierarchical examination of barriers, interrelationships, and strategic insights

The integration of circularity into various functions, including procurement, is essential and is embraced by organizations for sustainable and profitable operations. Existing studies have explored circular procurement (CP) and its influencing factors. However, existing literature calls for a deeper examination of these factors to provide a smooth implementation guide for practitioners and to foster a comprehensive understanding of cause-and-effect relationships for future research by scholars. As a result, this study aims to investigate the interrelationship between CP barriers. Firstly, this study explores barriers through a thorough review of relevant literature with input from academic and industrial experts. Utilizing a classical triple-level framework, the work identifies and categorizes 21 barriers. Secondly, the study employs interpretive structural modeling (ISM) to examine the contextual relationships among the barriers. Thirdly, these barriers are classified into different categories using the MICMAC technique, based on their driving and dependence power. The research findings develop a hierarchical model of barriers, offering insights into which barriers are the most crucial and need immediate attention and how different barriers could influence each other. The study's unique contributions lie in its identification of hierarchical relationships between barriers and its categorization (independent, linkage, and dependent), contributing to tailored strategies for effective CP implementation.

Introducing the circular assessment of suppliers (CAoS) tool: A Kraljic matrix-based tool to facilitate circular procurement in private organizations

The emerging paradigm of the circular economy necessitates instruments capable of monitoring advancements in a timely and reliable fashion, thereby fostering superior decision-making and instantaneous feedback within corporations. Although numerous tools offer comprehensive evaluations of a company's circular endeavors, certain strategic facets associated with the circular economy are often overlooked. For example, there is a notable scarcity of frameworks or tools designed to assist private businesses in choosing suppliers in alignment with circular economy principles. This manuscript aims to introduce the Circular Assessment of Suppliers (CAoS) tool, a straightforward instrument that private organizations may utilize to gauge their suppliers' adherence to circular principles. The tool's genesis is rooted in the Kraljic Matrix, an approach employed to categorize a company's suppliers by subdividing them based on the intricacy of the supply market. Its development was concluded after conducting a review of the literature concerning circular supply chains and then choosing the appropriate criteria with expert guidance. This manuscript also unveils industrial implementations of this tool, as evidenced by two case studies. By integrating such a tool, a company can dynamically evaluate all suppliers, thus augmenting the circularity of procurement decisions. This tool could also function as a means to engage suppliers in dialogues about mutual circular priorities within the value chain.

Dynamics in the evolution of circular sourcing strategies: Evidence from German frontrunners sourcing for recycled plastics

Firms’ circular sourcing strategies are essential for the transition to a circular economy as they enhance circularity both within individual firms and across industries. A key barrier to the implementation of such strategies is that many approaches still offer a static perspective on resource use without addressing its evolutionary characteristics and dynamic interdependencies over time. Based on the assumption that companies’ strategic procurement decisions on recyclate markets show temporal patterns depending on the development of these markets (“marketness”), the dynamics in the complex cause-and-effect structures of circular procurement strategies are analysed longitudinally with the help of causal loop diagrams. Employing a comparative case-study design with the example of German frontrunners sourcing recycled plastics, the paper addresses three recyclate markets at various stages of development, ranging from the emerging market of recovered plastic litter, through the developing market of plastic recyclate from mixed post-consumer packaging waste, towards the well-established market of recycled deposit bottles. The results reveal ideal-typical longitudinal patterns of company leaders’ strong commitment to sustainability, facilitated by flexible organisational structures, significant investment in product development, sound supplier relationship management and brand building to sway consumer preferences towards circular products, indicating that market-shaping activities are key in long-term shifts towards circular market transitions. By understanding the dynamics of circular sourcing and their relationship with the development stage of recyclate markets, the study sheds light on potential governance measures to scale-up plastic recyclate markets for a circular plastics economy. It concludes that overall dynamics point to a steady development of firms’ circular sourcing strategies and a rapid growth in recyclate application, involving complex challenges of resource circularity that call for carefully targeted regulatory policies.

Antecedents and performance outcomes of circular procurement: An empirical study in China

Traditional procurement approaches and their prescribed business-as-usual practices are no longer sufficient in the face of society’s grand environmental and resource challenges. In response, this research presents circular procurement, which is grounded in the circular economy (CE) philosophy, as a business-not-as-usual approach to firm and supply chain level purchasing decisions. Drawing on institutional theory and the practice-based view of strategy, a conceptual model is developed that maps the antecedents as well as performance outcomes of circular procurement practices in terms of the environmental and economic (i.e., cost and financial) dimensions of performance. Survey data from 255 Chinese manufacturers is then analyzed alongside qualitative data from two post-survey case studies to achieve better interpretation of survey results. The findings indicate that coercive pressures and integrated management systems (IMS) are key antecedents of circular procurement practices among Chinese manufacturers. Furthermore, circular procurement practices show a significant and positive effect on environmental, cost, and financial performance. Interestingly, the association between environmental performance and circular procurement is relatively weak in comparison to economic performance. This research provides empirical evidence of the performance outcomes of circular procurement and contributes to the literature by advancing our understanding of its theoretical foundations. It further provides important practical and policy guidelines that can help to enhance the development of circular procurement.

Circular economy a push and pull mechanism - Recycling starts before purchasing

Public procurement is a mechanism through which the public sector can benefit from the latest technological processes and assistance from the private sector, while retaining its position as the main decision-maker in setting and implementing investment policies. This paper aims to make a quantitative analysis in an attempt to identify, to what extend, the contracting authorities in Romania, given the increased demand for the purchase of IT equipment caused by the emergence of the COVID-19 pandemic, as well as the recommendations of the European Commission in this field, have used, in their tender documents, evaluation criteria/factors specific to circular purchasing. In addition, the analysis aims to establish how the recycling and circularity process can be determined from the early stage of the tender documents, when establishing the evaluation factors that will directly impact the contract winner. Using principal component analysis and the Cronbach coefficient alpha combined with “the Varimax” method, the nature and the weight of the evaluation factors have been identified in a circular procurement process, considering the best value for money. The final findings represent a mix of criteria for IT circular procurement to be used to push the suppliers to clean/green production and to pull the market to a circular economy sales and consumption paradigm.

How to increase the uptake of circular public procurement? Lessons learned from local authorities in Sweden

PurposeCircular procurement is assumed to foster innovation and influence demand for and supply of goods through criteria setting and dialogue with suppliers. However, even in countries placed at the forefront of sustainability practices such as Sweden, examples of procurement that can truly be considered to be circular are rare. This paper aims to examine circular public procurement practices in a selection of Swedish municipalities and regions through the lens of the Advocacy Coalition Framework. The authors propose a categorisation of municipalities by circular procurement uptake and identify factors that support the acceleration of the circular transition in Sweden.Design/methodology/approachUsing the key informant approach, the authors conducted semi-structured interviews with employees of seven municipalities, one region and one external procurement agency, as well as seven suppliers of various sizes. The authors also analysed procurement documents received from municipalities. Participating organisations represented a variety of Swedish local government structures and local conditions.FindingsThe authors proposed a categorisation of circular procurement uptake. Notably, beginners differ from leaders in circular procurement, most importantly by the level of flexibility policy brokers have within their organisations and by policy brokers’ ability to accommodate changes that materialise between existing organisational structures and set routines.Social implicationsThe fragmented uptake of circular procurement poses a challenge for local businesses interested in implementing circular business models. It also both highlights and exacerbates inequalities in access to resources between sparsely populated, rural municipalities and more urbanised areas.Originality/valueDespite existing national government guidelines for the circular economy transition in Sweden, circular procurement is not fully realised at the local level. In this paper, the authors examine the Swedish experience with circular procurement and propose several steps to improve the uptake of circular procurement by the public authorities. The authors' findings concerning the role of policy brokers may well be generalised to similar socio-cultural contexts.

Transitioning from green to circular procurement in developing countries: a conceptual framework for Ghana’s construction sector

ABSTRACT Circular procurement (CP) systems are fast evolving and recently, regarded as a ‘golden-ring’ to be leveraged in promoting the circular economy. However, it appears that the construction sector of developing countries is yet to make any significant adaptions and improvements to its existing procurement practice. In this paper, we examine the state of procurement practice in such countries for opportunities to develop and implement CP. Using case analysis from the Ghanaian context, evidence on the status quo of existing green procurement system is sought to ascertain gaps and similarities between practice, policy and targets needed for CP implementation. Qualitative methods comprising the use of secondary data and interviews with stakeholders from three public tendered projects were adopted, and results analysed to develop a conceptual framework for CP. The findings of the study reveal that government policy, circular strategy, circular sourcing and platforms are essential components that need to be developed for CP implementation. Hence, the developed framework proposes an integration of these aspects through the four-lenses of people, process, policy and technology. The output of this research provides a collective roadmap for policymakers, practitioners and academicians towards the attainment of more circular consumption patterns in emerging construction markets.

A New Framework for Circular Refurbishment of Buildings to Operationalize Circular Economy Policies

The current policies aimed at promoting the decarbonization of existing buildings under the principles of the circular economy are in need of practical measures tailored to local conditions to increase their effectiveness. The lack of standard practices for assessing buildings’ refurbishment strategies toward energy efficiency and CE principles reflects this reality. To tackle this issue, a new framework for refurbishing circular buildings, is proposed in this paper, based on circular procurement and incorporating a lifecycle perspective. This framework articulates a dialogue between local authorities and private stakeholders through a set of steps that encompass building mapping, selective disassembly, (re)design, and (re)build practices, providing opportunities to implement policy-based incentives. The application of the framework within the Portuguese context demonstrates the potential to identify critical moments within the refurbishment process that can materialize in a new set of CE policy actions to be implemented at the building level. These policies are aligned with local construction permitting procedures and take advantage of the resources and incentives offered by the local administration, such as tax incentives.

DESIGNING A COLLABORATIVE MODEL FOR THE RAW MATERIAL PROCUREMENT PROCESS TO ELEVATE THE FURNITURE INDUSTRY COMPETITIVENESS

The furniture industry is a non-oil and gas sector that can be developed aggressively due to the abundant natural resources provided by Indonesia's forests. However, there are several issues in the wooden furniture industry, starting on the upstream supply chain, especially in the raw material procurement process. The increasing product cost because of high procurement costs could make this industry hard to compete or grow. Thus, this study proposes an improvement of raw material procurement by developing a collaborative model to minimize the total circular procurement cost in the wooden furniture industry supply chain. Adopting the collaborative model is expected to reduce the raw material procurement costs of all parties involved in the supply chain by shortening the supply chain. In addition, this study built a dynamic system model with an implementation circular supply chain concept, which focuses on regenerating the wood raw material toward zero waste. The finding is that a collaborative model could reduce the total circular procurement cost by 25% to 35% compared to the base model. A recommendation for building the terminal comes from the collaborative model. The result of this study provides a solution to elevate the furniture industry's competitiveness through cost reduction.

DESIGNING A COLLABORATIVE MODEL FOR THE RAW MATERIAL PROCUREMENT PROCESS TO ELEVATE THE FURNITURE INDUSTRY COMPETITIVENESS

The furniture industry is a non-oil and gas sector that can be developed aggressively due to the abundant natural resources provided by Indonesia's forests. However, there are several issues in the wooden furniture industry, starting on the upstream supply chain, especially in the raw material procurement process. The increasing product cost because of high procurement costs could make this industry hard to compete or grow. Thus, this study proposes an improvement of raw material procurement by developing a collaborative model to minimize the total circular procurement cost in the wooden furniture industry supply chain. Adopting the collaborative model is expected to reduce the raw material procurement costs of all parties involved in the supply chain by shortening the supply chain. In addition, this study built a dynamic system model with an implementation circular supply chain concept, which focuses on regenerating the wood raw material toward zero waste. The finding is that a collaborative model could reduce the total circular procurement cost by 25% to 35% compared to the base model. A recommendation for building the terminal comes from the collaborative model. The result of this study provides a solution to elevate the furniture industry's competitiveness through cost reduction.

The Nexus of Industry 4.0 and Circular Procurement: A Systematic Literature Review and Research Agenda

In the wake of Industry 4.0, circular supply chain management has undergone radical transformations. Organizations have been able to boost their efficiency thanks to incorporating Industry 4.0 technologies such as big data analytics, the internet of things (IoT), blockchain, cloud computing, artificial intelligence, etc., into various supply chain functions. Since circular procurement (CP) is an essential part of circular supply chain management, it can provide fresh chances for organizations to become more efficient and sustainable. With the support of Industry 4.0 technologies, CP can provide extra opportunities for accelerating the shift to the circular economy. Although research into the intersection of procurement and Industry 4.0 continues to advance, no review study has examined the implications of Industry 4.0 in CP. Therefore, this research aims to address this knowledge gap by systematically reviewing the existing literature about the applications of Industry 4.0 technologies in CP. A total of 89 journal articles were selected from Scopus and Web of Science databases to identify the themes discussed and set an agenda for future research. A conceptual framework is also developed to evaluate the antecedents, enablers, and performance outcomes of Industry-4.0-enabled CP. Finally, the review concludes by highlighting the theoretical and practical implications.

Circular procurement: A systematic literature review

In recent years, there has been a phenomenal growth in procurement research towards a circular economy (CE). However, to date, there is a lack of systematic synthesis of this body of knowledge hindering theoretical development. This work aims to investigate the current state of circular procurement (CP) in both the public and private sectors through a systematic literature review . To this end, this paper reviews the relevant studies published between 1998 and 2021 and identifies three themes: antecedents, practices, and performance (outcomes). New subcategories for the themes are also presented. Based on the structured analysis, we propose a conceptual theoretical model of CP and future research directions.

A systematic review on barriers and enablers toward circular procurement management

In the last couple of years, circular supply chain management considered the most significant tool for the circular economy. It supports converting production and consumption patterns from linear to sustainable. Several studies have covered the implementation of circularity in different settings, but no concrete investigation exists that in-depth and explicitly explores the procurement perspective toward the circular economy. Previous studies also highlighted the need to focus on procurement or supply management perspective because it consumed an ample amount of budget in the public and private sector. To fill this gap, this study provides a state-of-the-art analysis to adopt circularity in procurement operations. This comprehensive analysis had done by reviewing the 100 peer-reviewed research papers related to the implementation of circular economy and sustainable procurement. This study not just covered the top-down view of literature but advances the literature by finding 55 barriers and enablers under different clusters. From the output, it is evident that efforts need to be taken from 360-degree stakeholders. However, sourcing strategy and procurement operations need to be revamped. This review unpacks the factors at the micro, meso , and macro-level that help academicians to create a framework for empirical investigation. Similarly, it helps practitioners, policymakers, and decision makers to achieve sustainable development goal (SDG) number 12 by incorporating circularity in procurement.

Measuring the Effect of Circular Public Procurement on Government’s Environmental Impact

Governments contribute to the transition toward a circular economy (CE) by using criteria in their procurement processes that trigger the supply of circular products and services, namely circular public procurement (CPP). CPP practices are emerging in Europe. However, the effect of CPP is not yet monitored and hence remains unclear. What is the efficacy of CPP in reducing the impacts of goods and services? Analyzing CPP efficacy is an important next step in exploring how to improve its application. This paper presents the results of an effect evaluation of CPP in the Netherlands, using a sample-based mixed-method approach in combination with life cycle assessment for analyzing CPP-induced reduced impacts on global warming and material use. Two thirds of the procurement tenders in which circular procurement criteria were applied in 2017 and 2018 did not result in reduced environmental impacts or reduced material use. One third, however, showed that, as well as how CPP can contribute to the transition toward a CE. The identified remaining challenges are (1) to apply criteria that are ambitious enough to challenge the market and (2) to keep attention on the circularity ambitions up during the implementation phase of the procurement process. Effect indicators are proposed to complement the current monitoring practices of CPP implementation.

Green and circular procurement in public organizations – from single use to reuse and prolonged lifetime in the City of Malmö

The procurement in public organisations has traditionally been performed in a linear way. Using circular solutions could help public organisations to save resources and tackle climate change. The Swedish City of Malmö strives to include circular solutions and become a circular municipality. The goal of the study was to explore activities for increased reuse and visualise how circular material flows can reduce environmental impacts. The goal was also to develop a method for mapping material flows that can be used in the City of Malmö and other public organisations. The studied activities included in this study are the reuse of furniture and replacement of single use plastic with reuse alternatives, as well as prolonged lifetime of IT products and textiles. Life cycle analysis (LCA) based methods were used to estimate the reduction in environmental impact from the studied activities. The perception of circular activities within the City of Malmö was analysed with a survey. The results showed that the purchasing agreements with increased lifetime for clothing and IT products, lead to reduced environmental impacts. The results also showed that most employees are interested in using a digital sharing platform. Additionally, the results pointed out the need for a circular manager.

The role of public procurement to foster social equity and justice: critical reflections on the circular procurement concept

ABSTRACT This paper presents the case of public procurement, which is seen as a powerful instrument to foster social equity and justice. It builds on theories that acknowledge social equity and justice as core values of public administration that should be among the guiding principles of the circular economy transition. The paper refers to public procurement as a core activity of public organisations, which basic operational guidelines are social equity and justice. The research introduces strategic approaches to procurement to understand how public procurement can foster social equity and justice in procurement practice. The focus is on socially responsible public procurement (SRPP) and the recently emerged concept of circular public procurement (CPP). The paper will make a critical reflection on CPP through the lenses of social equity and justice. It is concluded that current definitions of CPP do not reflect on issues of social equity. The paper argues that CPP can learn from SRPP and foster social equity and justice in procurement practice. It offers a consensual definition for CPP and acknowledges the need for a meta-definition for the different strategic procurement concepts. The purpose of this paper is twofold. First, it contributes to academic research on public procurement and circular economy; second, it provides inputs for interdisciplinary research on circular procurement. The originality and value of the paper are that it is the first attempt to reflect on CPP through the lenses of social equity and justice. The paper provides implications and recommendations for academics, policy makers and procurement practitioners.

Retracted: Industry 4.0 and circular economy practices: A new era business strategies for environmental sustainability

AbstractAmid rising environmental concerns, Industry 4.0 and blockchain technology (BCT) are transforming circular economy (CE) practices and prevailing business models. Recognize the same; this study examines the role of blockchain technology in circular CE practices and their impact on eco‐environmental performance, which influences organizational performance. The study collects data from 404 enterprises located in Chinese and Pakistani territories, involved in cross‐border supply chain operations. Both countries' sample has great relevance due to the China Pakistan Economic Corridor (CPEC), which possesses several positive fallouts in terms of technology spillovers across firms. Using the partial least squares structural equation modeling (PLS‐SEM) modeling framework, this study provides three key findings. First, BCT significantly improves the circular economy practices (circular procurement, circular design, recycling, and remanufacturing). Second, CE practices help improve firms' environmental performance and stimulate their financial performance. Third, higher eco‐environmental performance significantly boosts organizational performance. This study sets out the foundations for participating countries/firms that simultaneously achieve financial and sustainable goals by integrating blockchain technology in circular economy practices.

Digital technology and circular economy practices: An strategy to improve organizational performance

AbstractAmid rising environmental concerns, advanced technology, including Blockchain technology (BCT) are transforming circular economy (CE) practices and prevailing business models. Recognize the same, the current study examines the role of BCT in CE practices; and their impact on organizational performance. The study collects data from 239 enterprises that are located in Malaysian territories. By employing PLS‐SEM modeling framework, the study provides two key findings. First, BCT significantly improves the CE practices (circular procurement, circular design, recycling, and remanufacturing). Second, CE practices help to increase organizational performance. This study set‐out the foundations for participating countries/firms, that help to simultaneously achieve financial and sustainable goals through the integration of BCT in their business for betterment.