Chapter 1
Logistics in the Circular Economy:
Challenges and Opportunities
Alistair Beames, G. D. H. Claassen, and Renzo Akkerman
Abstract Circular economy (CE) is a concept that has gained considerable attention
in recent years, particularly in the domain of Industrial Ecology. CE requires
products to be easily repaired, refurbished, remanufactured, and eventually recycled.
The transition to a CE creates distinct material flows that have to be managed in an
efficient and sustainable manner. Existing studies on CE tend to focus on product
design, material use, and the market potential of CE products with little attention
paid to the logistics challenges associated with such developments. From a logistics
perspective, CE can be seen as the integrated management of forward and reverse
flows of products in a supply chain. In the operations and supply chain management
literature, a large body of knowledge on how to operationalize closed-loop supply
chains (CLSCs) already exists and is a starting point for understanding logistics in
the CE context. As with traditional forward supply chain network design, CLSC and
CE supply chains also require decisions on the role of facilities, their location, their
capacity allocation, and their demand and supply allocation. The CE concept does
however introduce new challenges especially as circular business innovations converge to increased servitization and to more collaborative and open business models.
The transition towards circular business models requires businesses to position
themselves according to three key strategic decision-making problems, namely,
(1) the extent to which the logistics network is centralized, (2) the extent to which
the product is servitized, and (3) the extent to which logistics services are coordinated. This chapter presents a theoretical overview of the three trade-offs and what
their potential implications are.
Keywords Logistics · Circular economy · Closed-loop supply chain · Product
design · Supply chain network design
A. Beames (*) · G. D. H. Claassen · R. Akkerman
Operations Research and Logistics, Wageningen University and Research, Wageningen,
The Netherlands
© Springer Nature Switzerland AG 2021
J. Rezaei (ed.), Strategic Decision Making for Sustainable Management of Industrial
Networks, Greening of Industry Networks Studies 8,
https://doi.org/10.1007/978-3-030-55385-2_1
1
Logistics in the Circular Economy:
Challenges and Opportunities
Alistair Beames, G. D. H. Claassen, and Renzo Akkerman
Abstract Circular economy (CE) is a concept that has gained considerable attention
in recent years, particularly in the domain of Industrial Ecology. CE requires
products to be easily repaired, refurbished, remanufactured, and eventually recycled.
The transition to a CE creates distinct material flows that have to be managed in an
efficient and sustainable manner. Existing studies on CE tend to focus on product
design, material use, and the market potential of CE products with little attention
paid to the logistics challenges associated with such developments. From a logistics
perspective, CE can be seen as the integrated management of forward and reverse
flows of products in a supply chain. In the operations and supply chain management
literature, a large body of knowledge on how to operationalize closed-loop supply
chains (CLSCs) already exists and is a starting point for understanding logistics in
the CE context. As with traditional forward supply chain network design, CLSC and
CE supply chains also require decisions on the role of facilities, their location, their
capacity allocation, and their demand and supply allocation. The CE concept does
however introduce new challenges especially as circular business innovations converge to increased servitization and to more collaborative and open business models.
The transition towards circular business models requires businesses to position
themselves according to three key strategic decision-making problems, namely,
(1) the extent to which the logistics network is centralized, (2) the extent to which
the product is servitized, and (3) the extent to which logistics services are coordinated. This chapter presents a theoretical overview of the three trade-offs and what
their potential implications are.
Keywords Logistics · Circular economy · Closed-loop supply chain · Product
design · Supply chain network design
A. Beames (*) · G. D. H. Claassen · R. Akkerman
Operations Research and Logistics, Wageningen University and Research, Wageningen,
The Netherlands
© Springer Nature Switzerland AG 2021
J. Rezaei (ed.), Strategic Decision Making for Sustainable Management of Industrial
Networks, Greening of Industry Networks Studies 8,
https://doi.org/10.1007/978-3-030-55385-2_1
1