– targets larger companies in much the same way that the development of shopping centres often starts by luring major anchor stores around which other smaller retailers spring up . By helping large companies devise CE strategies , sizable material waste flows are diverted from landfill , energy footprints decline and opportunities for support businesses emerge . For example , a large logistics company might identify , as a CE initiative , the recycling of used tyres from its truck fleet . The company would likely resist reprocessing the tyres itself but would be willing to ally with a local SME to provide such as service . In this way , a tyre reprocessing opportunity emerges , the logistics company offsets disposal costs by selling worn tyres to this company , and new jobs are created . Consequently , stage 4 – SME CE Strategy Design – targets small and medium enterprises ( SMEs ) that can provide support for larger scale initiatives , such as the tyre example above . The program introduced at this stage aims to help entrepreneurs and SMEs identify , refine , finance and implement business plans to support network circularity . Participating companies will develop business plans in areas such as logistics services , materials marketplaces , social ventures , digital services , leasing and rental services , repair services , customized resource reprocessing , design and even financial support services .
Finally , at stage 5 – CE Network Optimization – the focus turns to supporting progressive innovation by engaging with tertiary institutions and other capacity building organizations to play roles in optimizing resource utilization throughout the CE network . Unlike stages 2-4 , this stage focuses less on capacity building and more on the physical creation of innovation hubs , maker spaces , materials reprocessing precincts , CE consultancies and even CE retail precincts to ensure that CE networks dynamically evolve and improve .
To date , Hume has completed the first stage . The approach taken with economic opportunity analysis reflects a departure from traditional economic modelling . Accordingly , it warrants describing how this was undertaken , because many municipalities that are exploring CE development strategies might benefit from adopting elements of this unique approach to economic opportunity modelling .
PARTICIPATIVE ECONOMIC OPPORTUNITY MODELLING INCORPORATING SCENARIO ANALYSIS Estimating what can be achieved under a CE development strategy is complicated because the estimate must include projections related to : i ) more effective management of waste resources , ii ) growth in the advanced materials reprocessing sector , iii ) business adoption of CE principles , which inevitably foster both cost savings and new product / service innovation and iv ) new businesses entrants . All four are interconnected ; and as such , modelling requires a systematic analysis of how these elements will co-evolve under varying conditions . KPMG ’ s economic modellers addressed this challenge by employing scenario analysis to guide development of a computable general equilibrium model .
One of the weaknesses of scenario analysis is that predictive accuracy depends extensively on assumptions that modellers make . KPMG ’ s scenario development strategy attenuated this risk by ensuring the projections were made with input from expert panels of municipal policymakers and private stakeholders ( from the waste management and manufacturing sectors ). Co-designing outcome projections with policymakers and business leaders ensured that assumptions were grounded in industry perspectives on what is viable .
The process began through deliberations with policymakers in the CE working group , eventually enabling the formulation of a basic CE vision for Hume , with key activity areas delineated ( Figure 2 ). In addition to recycling and materials repurposing , the conceptualization process highlights a materials marketplace as being central to supporting effective material flows . The process also identifies innovation spaces , events hubs and CE training programs , such as Circular Advantage , as being central to preparing entrepreneurs and
Arguably it is the desire to ensure social , cultural , economic and environmental balance that has engendered support for CE strategy . In Hume ’ s conceptualization of the CE , the main objective is resource optimization .
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