Closing the loop: exploring circular business models for kitchen household appliances

Examensarbete för masterexamen
Master's Thesis
Quality and operations management (MPQOM), MSc
Delli Baskaran, Nisha
Replacing household appliances very often results in wastage of raw materials and natural resources involved. Circular economy could be a great solution to minimize such wastage in household industry and there are more ways to implement it. Interestingly, the recently trending product service systems seems like a promising enabler of circular economy by enabling multiple users to utilize the complete lifecycle of the product through reuse, refurbishment, remanufacturing and recycling. Although, circular economy is most extensively researched domain, practical aspects are neglected. Hence, this thesis aims to bridge the research gap by exploring and designing a suitable circular business model for the focal company in order to close the loop. Further, it explores new B2B and B2C customer segments for focal company to enable such business model which extends the market share of the organization as well. The research was initiated by doing a literature study on circular economy business models which highlighted servitization to be a successful enabler of circular economy. Later, an interview study was conducted to provide qualitative data for the research which helped in exploring various dimensions like possibilities, benefits and challenges associated with developing a servitized circular economy business model. Based on the empirical findings and emanated results, three preliminary subscription models were developed for three identified customer segments in order to slow down the resource loop. Later, a workshop was conducted to gain expert opinions on the developed preliminary models which necessitated customization and hence scenario analysis was conducted for focal B2B customer segments. For further validation on profitability aspect, an economic analysis is done. These lay the groundwork for the upcoming discussion which probe deeper into the various aspects of the proposed business model. In the conclusion, this thesis successfully developed a new business model for the focal company to keep their first big step towards the path of circular economy. The below mentioned parameters were used as keywords to shortlist literatures and also, the interview questions were framed by keeping these parameters as a base.
Product service systems, servitization, circular economy, servitized business models, dishwashers, household appliances industry, closing the loop
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