As the world transitions towards a circular economy, the Procurement department has many vital roles to play. A method at the ‘system level’, which concerns the contractual methods that the purchasing organization can use to ensure circularity. The ‘supplier level’ model describes how suppliers can build circularity into their own systems and processes, in order to ensure the products and services they offer meet circular procurement criteria. ‘Product level’ is related to this but is focused solely on the products that suppliers to public authorities may themselves procure further down the supply chain. Raw materials refer to materials or substances used in the primary production or manufacturing of goods and manufactured goods refer to any objects created by humans to satisfy their needs and improve their standard of living, both in line with the basic principles of the circular economy.
How can companies transform towards more circular procurement practices and strategies?
Circular Economy is part of the relevant European strategy – which is developing rapidly – and corresponds to the features of the Greek economy. The circular economy can play a catalytic role for productive reconstruction and has a clear regional dimension. It is based on the rational use of resources, the concept of recycling-reuse and the industrial symbiosis model. Procurement’s contribution to an organization’s success is about more than managing spending. As the world transitions towards a circular economy, the Procurement department has many vital roles to play. A method at the ‘system level’, which concerns the contractual methods that the purchasing organization can use to ensure circularity. This ranges from supplier take-back agreements, where the supplier returns the product at the end of its life in order to re-use, remanufacture or recycle it, to product-service systems, where the contract provides both services and products. An example of a product-service system is a printing contract using a pay-per-copy model, in which the supplier provides all equipment, repairs, replacements and training rather than simply selling copy supplies. The ‘supplier level’ model describes how suppliers can build circularity into their own systems and processes, in order to ensure the products and services they offer meet circular procurement criteria. ‘Product level’ is related to this but is focused solely on the products that suppliers to public authorities may themselves procure further down the supply chain. It is important when undertaking circular procurement that both the supplier systems and product technical specifications are considered.
What is the difference between raw materials and intermediate materials and how can each type of material (raw and intermediate) be best used in accordance with circular economy principles?
Raw materials are materials or substances used in the primary production or manufacturing of goods. Raw materials are commodities that are bought and sold on commodities exchanges worldwide. Examples of raw materials are Grains such as wheat and rice, Vegetables such as carrots and onions, Meat such as beef and chicken, Wood from a tree, Honey from a bee’s nest, Minerals or metal from a mine, as well as crude oil. Technical materials are common materials used to make manufactured goods. Glass, steel and metals, plastic, porcelain and ceramics, planks or concrete are examples of materials. Manufactures Goods are any objects created by humans to satisfy their needs and improve their standard of living. Each type of materials is based on the three principles of circular economy, all driven by design, having to do with eliminating waste and pollution, considering waste and pollution as design flaws rather than inevitable by-products of the things that are made, circulating products and materials, as well as regenerating of the nature.