What’s the “Use” of Circular Business Models?

This paper investigates the problem of developing circular economy business models and the challenges facing the building industry in practice. Despite the recent attention to circular economy in both research and practice, applications to the building industry are falling short (Geldermans, 2016; Ghisellini, P., Ripa, M., & Ulgiati, S. 2018; Nußholz, Rasmussen, & Milios, 2019). The aim of this research is to examine the opportunities and barriers to the implementation of circular economy in the building sector, also referred to as circular construction. In particular, building organizations have recently demonstrated an interest in innovating circular business models in order to transition their cradle-to-grave business to circularity. Recognition of this interest arose from ethnographic research in the building organization VELUX A/S, a company best known for its roof windows, but also deeply engaged in the research into and development of sustainable buildings. The research was then furthered with two workshops – one internal and one external – and secondary data such as circular building materials and events concerning circular construction. The research finds that – akin to other industries – the building industry places an inordinate amount of attention on the reuse and recycling of material and little attention on extending the use of buildings (and thus their materials). This paper argues that one of the major shortfalls of current circular economy approaches in building is a lack of business models valuing the use phase of buildings, given these long-lasting products’ life span.