Since the inception of the industrial revolution, the human race has always been a fan of the linear model of manufacture and consumption. Unrefined components have been converted into products that are thereafter sold, utilized, and changed into junk that has been commonly unknowingly disposed of and overseen circular economy.
In the linear economy model, products are made by using raw natural resources. The raw natural resources are chemically processed, converted into products, and discarded. On the other hand, a circular economy model includes repairing, sharing, renting, and reusing existing materials and items as far as might be feasible. Circular economy model targets handling worldwide difficulties like environmental change, biodiversity misfortune, waste, and contamination.
This implies that a circular economy performs the following things:
- Wipeout waste
- Limiting the excessive use of natural resources
- Promoting the use of renewable energy
- Removing the utilization of synthetic substances
Now we have the basic idea of how things work in the linear and circular model of consumption and production. Let’s move ahead and talk about the advantages that a circular economy offers.
Advantages of Circular Economy
The circular economy model is by purpose a model of regrowth. It intends to enhance resource performance and battle the instability that environmental change may bring to organizations. It provides a wide range of economic, social, and environmental benefits.
- Reduced Toxic Emissions
Circular Economy aims to conserve our natural resources by limiting their excessive use and bringing a good global climatic change. With recycling practices, the circular economy is capable of decreasing greenhouse gas emissions, use of raw components, and mitigating the side effects brought by the linear model. The circular economy model works well in reducing toxic emissions for the following reasons:
- With reusing, fewer materials and production procedures are required for creating products with good functionality.
- Priority is always to use energy effective practices, non-harmful materials, recycling, and production procedures.
- It utilizes sustainable power which is less polluting as compared to fossil fuels.
- The remains are viewed as important and they are retained however much as could be expected to be reused simultaneously.
- Ample Job Opportunities
The circular economy model creates millions of jobs by adopting repairing, recycling, reusing, and remanufacturing practices. Apprehending and reusing such significant and uncommon earth metals aids in making the economy more robust to resist the global supply chain disturbances and guarantees the world has the materials to make the sustainable power framework it needs.
The creation of ample jobs is implied by the fact that in order to develop a circular economy model, numerous new industry types should arise. This indicates that there will be a lot of new positions accessible. However, an immense overall concern is that numerous natural practices might eradicate a few jobs, similar to coal mining or different positions that are related to nonrenewable assets.
The positive approach to this is, that these positions won’t just be supplanted with different opportunities but even much more jobs might arise.
- Restricting The Extreme Use of Non-Renewable Resources
For many years, metaphorical experts and scientists have been enlightening us with the adverse global climatic changes. Time and again they have stressed on taking serious measures to protect the earth. One such critical alert has been the exorbitant use of finite resources.
Today, we keep on burning-through nonrenewable assets like oil and metal minerals as if we have an interminable stock (in reality we don’t have an unlimited supply). However, with the circular economy model, we can conserve our natural resources. Practices like reusing, recycling, and revamping allow to control the overuse of raw materials and natural resources.
Ideally, a pure circular economy does not produce waste. This can be said that a circular economy is the best method to deploy the existing resources.
- Income Benefit to Consumers
To many, the circular economy model is not a familiar term but gradually the principles that constitute the circular economy are penetrating into society. Have you ever noticed that when you borrow a dress from your relative or friend for a special occasion, you are actually following the “sharing” principle of circular economy?
Today, many mothers of toddlers distribute their toddler’s accessories and toys for free through social media platforms. Isn’t the principle “reusing” of the circular economy utilized here? The answer to both these questions is a big YES.
To your surprise, Carrie Symonds, wife of the British prime minister was seen wearing a rental bridal gown at her wedding. That’s how the circular economy has started to change our lifestyles.
The reuse of materials debilitates the practice of giving the product intentional outdated nature which implies that your items will have long durability.
It likewise guarantees high disposable earning since it promotes practices like purchasing utilized things, renting or leasing as opposed to buying, and other more monetary practices.
Whole Life cycle Costing
Whole life cost is the all-out cost of claiming a resource over its whole life, from buying to removal. It is otherwise called the life-cycle cost and the lifetime cost. The other two interesting names of whole life cost which actually define the meaning of the term whole life cost are- i) womb to tomb ii) cradle to grave. Whole-life cost incorporates buy and establishment, plan and building costs, working expenses, maintenance, related financing expenses, deterioration, and removal costs.
Whole life cycle costing is the process of calculating the life cycle cost of an asset. Lifetime costing is a venture evaluation and management tool which evaluates the all-out cost of a resource over its entire life.
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Advantages of Whole Life Cycle Costing
Assessing the life cycle cost of an office or property provides an assortment of short-term and long-haul benefits. From improved predicting capacities to an expanded spotlight on energy preservation, a daily life cycle cost examination gives many advantages. Let’s discuss some of the benefits of whole life costing.
- Maintenance Schedule
Life cycle costing provides long-haul data about property upkeep and expenses. At the point when this data is received during a venture’s development stage, landowners and managers can plan a maintenance program that doesn’t meddle with times of pinnacle activities. Moreover, managers can guarantee that they have adequate labor and assets to meet the maintenance needs.
- Re-Engineer the Product
Whole life cycle costing helps with estimating product costs and profits. In short, it enables effective cost management. For instance, such situations can occur where whole life cycle costing gives the opportunity to maximize profits. Firstly, the managers might need to reduce the product cost when the profit is excessively low. In such a scenario, the management can ask the designer to pull out some features to decrease cost. Automatically this will increase the estimated profits. This can be done in the beginning phase when items are not manufactured in ample amounts.
Secondly, the management might overhaul the item by adding new provisions to expand the item life, which will boost the profit too.
- Water and Utility Costs Estimation
Life cycle cost investigators perceive that expenses for water and utilities vary uniquely in contrast to different expenses. They are usually based on the level of consumption and utilization notwithstanding value projections. Analysts think about this when working out costs.
- Choosing The Maximum Profit Yielding Product
Life cycle costing will empower the organization to choose the most profitable item to be made. It will assist with both, boosting investor opulence and management dedication and performance.
Given the fact that we have plenty of climatic challenges, we should adopt all such economic models and practices which promote the use of renewable sources. One such model is the circular economy model that is based on the principles of reusing, refurbishing, and recycling. By using this model, we can make successful attempts to save our natural resources.
On the other hand, when it comes to maximizing profits, we talk about whole life cycle costing which enables us to do effective cost management for accurate financial expenses and cost estimations.
And you, what do you think, do you agree with my point of view or do you have a complete different opinion? Leave us all your comments below.
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