The Potential for Purchasing Function to Enhance Circular Economy Business Models for ETO Production

Abstract

Inclusion of ‘circular principles’ in the activities of the purchasing process from the initial stages to the end of product life can help all actors in the value chain to deliver sustainability goals through an active, cost-effective and accountable approach. Yet, research on this linkage has been virtually nonexistent. This study extends perspectives and theories on purchasing and circular economy business models (CEBMs) for engineer-to-order (ETO) production. Based on a case study, a framework that identifies critical purchasing activities relevant for enhancing the implementation of CEBMs is developed. The framework advocates that engaging in the proposed activities can compel the purchasing function to increase its strategic focus by being proactive and relentless in embracing circularity in its agenda. In addition to accentuating the relevance of purchasing function in ETO production, the framework shows how harnessing it can benefit circular strategies.