Barriers and Drivers for Changes in Circular Business Models in a Textile Recycling Sector: Results of Qualitative Empirical Research

Abstract

The growing environmental problems associated with the dumping of large amounts of textile waste and the demand for circular products are prompting textile waste recycling enterprises to develop circular business models (CBMs). This implies a radical change in the way some enterprises operate to obtain growth. Considering the importance of the drivers of and barriers for the adoption and implementation of CBMs in the textile recycling sector, it is claimed that the comprehension of these factors to CBMs is limited and deserves more attention in empirical research. Therefore, our research investigates the antecedents of circular business models in the textile recycling sector by highlighting influencing factors. The aim of the article is to explore the main enhancing and inhibiting factors in the development of circular business models on the example of a large enterprise operating for 30 years in the textile recycling sector. In this study, a case study design of mixed methods, including semi-structured interviews with a business practitioner and the data presented on the websites of the surveyed enterprise, is used. The results suggest that main enhancing factors are relevant regulations at the European level, appropriate technologies and digitisation, and increasing social and environmental awareness of consumers and managerial capabilities. However, inhibiting factors are supply chain complexity and supply chain collaboration in connection with a large scale of business in crisis situations, a large scope and range of geographic diversification of outlets in the perspective of the consequences of the information gap, and readiness to take the so-called “being the first in the market” risk. In practice, this means that general drivers of the CBMs may facilitate the reuse of second-hand clothing and recycling of textiles for other new products as the primary CE action. On the other hand, enterprises have to overcome a number of technological barriers, and in the case of the textile recycling sector, it is necessary to understand which barriers they face to take appropriate actions. Research findings indicate factors that may be the subject of intervention or support of managers or policymakers. This study has practical implications and suggests future study paths.

A Framework to Assess Manufacturers’ Circular Economy Readiness Level in Developing Countries: An Application Case in a Serbian Packaging Company

“…Among them, ref. [51], exploring the main enhancing and inhibiting factors for a progress towards circular business models, found that relevant regulations at the European level, appropriate technologies [23,52], and increasing social and environmental awareness of consumers [53][54][55] and managerial capabilities [11,56] are main drivers for changes. However, companies' settings determine their predisposition towards the CE paradigm.…”

“…Ref. [51] explored the textile recycling sector and found that the main enhancing factors are relevant regulations at the European level, appropriate technologies and digitization, and increasing social and environmental awareness of consumers and managerial capabilities. Supply chain complexity was emphasized as one of the main inhibiting factors.…”

Are Australian Consumers Ready to Wear Recycled Clothing to Practice Sustainable Consumption?

“…The complexity of supply chains and collaborations relating to the reuse model were identified as the main barriers [35]. Other barriers to clothing reuse models include consumer disposal practices, producer disposal practices, and recycling technologies, which restrict closing the loop [36].…”

“…VTR separates clothing and textile wastes using the most modern, fully computerized lines, able to process 500 tons of materials while assuring sustainability and quality standards, such as ISO 14001 (2015) [53] and ISO 9001 (2015) [54], respectively. Finished products are sorted and packed from 700 different assortment groups, with secondhand clothing sold to over 70 countries and several dozen VIVE Profit stores throughout Poland [35]. The Australian clothing recycling industry can learn from VTR to restrict the disposal to landfills and exporting of EOL clothing.…”

Investigating Accounting Factors through Audited Financial Statements in Businesses toward a Circular Economy: Why a Sustainable Profit through Qualified Staff and Investment in Technology?

“…Regarding the circular economy in terms of manufacturing businesses according to (Balanay et al 2022), other regions such as East and Southeast Asia, Japan, China, Germany, Finland, and the Philippines were also researched in the production, energy, and forestry sectors, where the importance is emphasized and the scientific information is necessary for the advancement of the circular economy for a sustainable sector of profit through innovations that must be brought by the businesses of different countries. Furthermore, regarding the impact of the circular economy on businesses according to (Wójcik-Karpacz et al 2023), the reinforcing factors of sustainable profit in businesses are the right technologies and digitalization, as well as managerial skills. To see the consequences of the circular economy on businesses in developing markets, according to (Dantas et al 2022), the consequences of the circular economy show that policymakers should reevaluate their business policies by promoting open innovation within the circular economy.…”