J.L.K.

Nußholz

Circular Business
Model Planning
Tool

A tool to help design business models that

extend the useful life of products and materials
and capitalize on the associated value
 Definition
Circular Business Models
………………………………………………………………………………..…
………………………………………………………………………………..…
A circular
Circular business
business modelaim
models is how In a circular
a company creates, captures,
to create andbusiness
delivers model, companies need
value with
the valuesystems
product creationthat
logic designed
keep to improve
resources at to adjust the
resource efficiency elements
through of their business
contributing to extending
useful life utility
maximum of products
for as and
longparts and closing
as possible, model to facilitate circular strategies, such as
and material loops.
in which material loops at the end-of-life are repair, refurbishment, remanufacturing, and
closed. recycling. These strategies can be operated
in their own business model or enabled
In a circular economy, companies need to through partner networks and extended
develop offers and value propositions with value chains. The value proposition includes
the idea of product life extension and products that are more durable, easy to
closing material loops in mind. This way, repair, reuse and remanufacture, as well as
companies can maintain and capitalize on services that enable collection of products.
the embedded value in products and
materials beyond a single life.
 Definition
………………………………………………………………………………..…
A circular business model is how a company creates, captures, and delivers value with
the value creation logic designed to improve resource efficiency through extending the useful life of
products and parts and closing material loops.
 Why use the circular business model planning tool?
………………………………………………………………………………..…
Map the
Map the value
value Plan
Plan and analyze the
and analyze the Recognize
Recognize inter-
inter- Identify
Identify opportunities
opportunities
creation
creation logic
logic of
of aa business
business model
model dependencies of
dependencies of to
to capture
capture residual
residual
company
company along
along the
the elements
elements atat the
the business
business model
model value
value of
of products
products
product
product life
life cycle.
cycle. relevant
relevant points
points ofof the
the elements
elements across
across and
and materials
materials
product
product life
life cycle
cycle that
that various
various life
life cycle
cycle and
and increase
increase
help
help implement
implement and and points.
points. resource
resource efficiency.
efficiency.
capitalize
capitalize on
on circular
circular
strategies.
strategies.
 Circular
Circular
Circular
Circular Business
Business
Business
Business Model
Model
Model
Model Planning
Planning
Planning
Planning Tool
Tool
Tool
Tool
………………………………………………………………………………..…
………………………………………………………………………………..…
………………………………………………………………………………..…
………………………………………………………………………………..…
Developed
Developed
Developed to help
help
todesign
help
desigdesig
aabusiness
a business 1. Circular
1. Circular
1. Circular
business
business
business model
model
model
Developed to to
help design business
a business 1. Circular business model
logiclogic
that that
capitalizes
capitalizes interventions
interventions (across
interventions
(to(to (across
the
maintain the
product
product
value
forfor
model
model thatthat maintains
maintains andonand the
on the
capitalizes
capitalizes interventions maintain value
embedded
embedded value
value
in products
in products andand lifelong
as as life
cycle)
as cycle)
as possible)
on on
thethe embedded
embedded value
value in products
in products long possible)
materials,
forfor materials,
as as
long asthis
long as this
tooltool
integrates
possible,
possible, integrates
thisthis
tooltool
business
business
integrates
integrates modelmodel
business
business thinking
thinking
model
model withwith
circular
thinking
thinking circular
withprinciples
with principles
circular
circular to principles
support
to support
principles tothe
to the
business
business
support
support 2. Business
Business
2. Business
model
model
2.
2. Business model
model
model
thethe modelplanning
business
business planningacross
model
model across
the
planning
planning the
product's
product's
across
across elements
elements
elements
elements
alife life
cycle.
cycle.
product's
a product's lifelife cycle.
cycle.
1. The circular business model interventions
………………………………………………………………………………..…
Collect & reintegrate
To circulate products,
parts, or materials, these
need to be collected and
reintegrated into the value
chain. Generally,
reintegrating secondary
production (i.e. products,
parts, materials) should be
preferred over using
primary materials. Collection
and reintegration can, in
some cases, also be
organized after the first
sale of a product to enable
additional sale(s) or
material recovery.
First sale (enabling
prolonged useful life)
When bringing an offer to
the market, a company
should enable a long useful
life of resources.
Manufacturing companies
can for instance design
for long-life, repair or re-
manufacturing of their
products. Companies in
the aftermarket can resell
a product or its parts, e.g.
through operating
refurbishment, repair
or remanufacturing.
Additional sale(s)
of the product or parts
To further prolong the useful
life of products, a company
can enable additional sale(s)
to other users. This can be
enabled through arranging
refurbishment, repair or
remanufacturing. In some
cases, only parts of the
product are suitable for
reintroduction to the market.
Note that the application of
the product and hence the
value proposition and
customer segments may
change for the additional
sale(s).
Material recovery
To prevent leakages and
downcycling of materials,
a company needs to
enable closed material
loops (e.g. recycling)
when the end-of-life is
irreversibly reached.
Product and business
models should be
designed to facilitate
maximum recovery of
materials.
 2.2.The
2. The Thethree
threethreevalue
valuevaluedimensions
dimensions
dimensions ofofbusiness
of the the
thebusiness
businessmodel
modelmodel
and and
and
theirtheir
theirelements
elements
elements (based
(based
(based on
onBusiness
on the the
theBusiness
Business Model
ModelModel Canvas*)
Canvas*)
Canvas*)
………………………………………………………………………………..…
………………………………………………………………………………..…
………………………………………………………………………………..…
Value
Value
dimensions
dimensions Business
Businessmodel
modelelements
elements Examples
Examplesofof innovating
innovating the
thebusiness
business
model
model
Value dimensions Business model elements Examples of innovating the business model
elements
elementstotofacilitate
facilitate
circularity
circularity
elements to facilitate circularity
VALUE
VALUE
VALUE PROPOSITION
PROPOSITION • •Innovating
Innovating thethe
offer
offer
from
from selling
selling ownership
ownership of of
a a
PROPOSITION Offer;
Offer; • Innovating the offer from selling ownership of a
Offer; Value product
product to to
selling
selling
access
access to to
it (e.g.
it (e.g.
totofacilitate
facilitate
itsits
Valueproposition;
proposition; productcollection
to sellingataccess
collection at
thethe to it (e.g. to facilitate its
end-of-life)
end-of-life)
What
What value
value
is is
proposed
proposed
Value proposition; collection at the end-of-life)
What value isto
proposed Customer
Customer segments;
segments; • •Improving
Improving thethe
value
value
proposition
proposition through
through adding
adding
and
and
to whom?
whom? Customer segments; Improving the value proposition through adding
and to whom? Customer/partner
Customer/partner relationships
relationships
•
services
services (e.g.
(e.g.repair
repair
andandupgrades)
upgrades)
Customer/partner relationships services (e.g. repair and upgrades)
• •Adjusting
Adjusting customer
customer relationships
relationships (e.g.
(e.g.rewards)
rewards) toto
• Adjusting customer relationships (e.g. rewards) to
help
help
remove
remove barriers
barriers
totocollection
collection of of
products
products
VALUE
VALUE CREATION
CREATION help remove barriers to collection of products
VALUE CREATION
AND DELIVERY
AND DELIVERY
AND DELIVERY
KeyKeyactivities;
activities; • •Finding
Finding
key
key
partners
partners
that
that
provide
provide
access
access
toto
How
Howis is
value
value createdKey activities;
created KeyKeyresources/
resources/ • Finding key partners that provide access to
capabilities;
capabilities; secondary
secondaryproducts
productsandand
materials
materials
How is and
value
and created
delivered?
delivered? Key resources/
KeyKey capabilities;
partners;
partners; secondary products
• •Setting-up
Setting-up and materials
reverse
reverse
logistics
logistics
and delivered? Key partners;
Channels
Channels • Setting-up reverse logistics
Channels
VALUE
VALUE
CAPTURE
CAPTURE • •Capitalizing
Capitalizing
onon
the
the
aftermarket
aftermarket of of
products
products
VALUE CAPTURE • Capitalizing on the
• •Reducing
Reducing aftermarket
production
production of through
costs
costsproducts
throughsubstituting
substituting
Costs;
Costs; • Reducing production costs through substituting
How
Howis is
value Costs; Revenue
captured?
value captured? primary
primary
materials
materials
with
with
lower-priced
lower-pricedsecondary
secondary
Revenueflows
flows primarymaterials
materials
How is value captured? Revenue flows materialswith lower-priced secondary
materials
* www.strategyzer.com
* www.strategyzer.c
* www.strategyzer.com
How to use the circular business model planning tool?
………………………………………………………………………………..…
Business model interventions in the product life
cycle to enable circularity.
Value dimensions and their
business model elements.
Begin with mapping the business model for the first
sale (2nd column). Fill in the other interventions
(columns) as much as possible. In each column, start at
the top of the bar and work your way downwards
through the business model elements.
Leave blank those boxes that are not included in the
current business model, i.e. business model elements
that are not yet developed to realize any of the
interventions. Note that not all interventions might be
relevant for the business model that is being mapped.
Reflect on columns and boxes that are blank. Do these
provide opportunities to capitalize on residual value of
products if business model elements would be shaped
differently or another circular strategy implemented?
Circular
Circular Business
Circular Model
Business
Business Model
Model
Collect & reintegrate
Collect & reintegrate First salesale
First (with
(with Collect & reintegrate
Collect & reintegrate Additional sale
Additional ofof Enable
sale material
Enable material
Collect & reintegrate First sale (with Collect & reintegrate Additional sale of Enable material
(reduce primary
(reduce materials)
primary materials) prolonged
prolonged use)
use) (organize take-back)
(organize take-back) product
productoror
parts
parts recovery
recovery
VALUE (reduce primary materials) prolonged use) (organize take-back) product or parts recovery
VALUE
VALUE
PROPOSITION
PROPOSITION
PROPOSITION

Offer
Offer
Offer
………………………… ………………………………
…………………………
………………………… ………………………………
……………………………… ……………………
…………………… ……………….
…………………… ………………. …………….
………………. …………….
…………….
Value
Valueproposition
Value proposition
proposition
………………………… ………………………………
…………………………
………………………… ………………………………
……………………………… ……………………
…………………… ……………….
…………………… ………………. …………….
………………. …………….
…………….
Customer
Customersegments
Customer segments
segments
………………………… ………………………………
………………………… ………………………………
……………………………… …………………… ……………….
……………………
…………………… ………………. …………….
………………. …………….
Relationships
Relationships
………………………… …………….
Relationships
customers/partners
customers/partners
customers/partners …………………………
………………………… ………………………………
………………………… ………………………………
……………………………… …………………… ……………….
……………………
…………………… ………………. …………….
………………. …………….
…………….
VALUE CREATION
VALUE
VALUECREATION
CREATION
ANDAND DELIVERY
ANDDELIVERY
DELIVERY

Key Key activities

Keyactivities
activities ………………………… ………………………………
………………………… ……………………………… …………………… ……………….
…………………… ………………. …………….
…………….
………………………… ……………………………… …………………… ………………. …………….
Key Key resources/
Keyresources/
resources/
capabilities
capabilities ………………………… ………………………………
………………………… ……………………………… …………………… ……………….
…………………… ………………. …………….
…………….
capabilities ………………………… ……………………………… …………………… ………………. …………….
Key Key partners
Keypartners
partners ………………………………
………………………… ………………………………
………………………… …………………… ……………….
…………………… ………………. …………….
………………………… ……………………………… …………………… ………………. …………….
…………….
Channels
Channels
Channels ………………………… ………………………………
………………………… ……………………………… …………………… ……………….
…………………… ………………. …………….
…………….
………………………… ……………………………… …………………… ………………. …………….
VALUE CAPTURE

J. Nussholz (2017)
VALUECAPTURE
VALUE

(2017)
CAPTURE

Nussholz(2017)
Costs
Costs ………………………………
………………………… ……………………………… …………………… ……………….
………………. …………….
…………….
Costs ………………………… ……………………
…………………… ……………….

J.J.Nussholz
………………………… ……………………………… …………….
Revenue flows
Revenue
Revenueflows
flows
Case Example

The company Fairphone offers a modular, long-life phone It is important to note that not all interventions have to
designed for reparability and recycling. Business model be addressed in a circular business model. This is
elements are shaped to facilitate collection after use, because in some cases, they are not economically
additional lives of phones, and material recycling. Through desirable or more resource efficient. But blank columns
collaborating with the reuse and recycling company can indicate that there may be an opportunity for
Teqcycle, for instance, Fairphone operates a take-back embedding more circularity in the business model and
scheme for phones and facilitates resale and recycling. that is worth exploring. To seize these opportunities, it
often requires collaboration along the value chain and
Fairphone, at the moment, does not use secondary alignment of the business model with partner
materials in their own products (e.g. recycled copper or companies.
plastic). Therefore, the first column is left blank. In the last
two columns, responsibilities between Fairphone and
Teqcycle are split and, thus, not all business model
elements of the focal company Fairphone are filled in.
www.Fairphone.com
 Circular
Circular
Circular Business
Business
Business
Model:Model:
Model:
Fairphone
Fairphone
Fairphone
Circular Business Model:
Collect & reintegrate Collect & reintegrate Additional Enable material
Fairphone Collect
Collect
& reintegrate
& reintegrate First
FirstFirst
salesalesale
(with (with
(with Collect
Collect
& reintegrate
& reintegrate Additional
Additional ofsale
salesale of Enable
of Enable material
material
(substitute primary prolonged use) (organize
(organize take-back)
take-back)
(organize take-back) product or parts recoveryrecovery
VALUE (substitute
(substitute
primary
primary prolonged
prolonged use)use) product or parts
product or parts recovery
VALUE
VALUE materials) Collect & reintegrate
PROPOSITION Collect & reintegrate
materials)
materials) First sale (with Additional sale of Enable material
PROPOSITION
PROPOSITION (substitute primary (organize take-back) product or parts recovery
VALUE prolonged use)
materials)Modular long-life phone; Free shipping for Resale for
Offer Offer
Offer
PROPOSITION Modular
Modular long-life
long-life phone;
phone; Free Free
shipping
shipping
for for
two EOU phones Resale
Resale for for Material recovery
Teqcycle Material
Material
recovery
recovery
……………………
……………………
replacement parts
………………………………
…………………… ………………………………
replacement
replacement
………………………………
parts parts ………………….…..…
two two
EOU EOU
phones
phones ………………….
Teqcycle
Teqcycle
………………….
…………………. ……….……….
……….……….
……….……….
(e.g. gold)
Modular long-life phone; ………………….…..…
………………….…..…
Free shipping for Resale for
(e.g.(e.g.
gold)gold)
Value Value
ValueOfferproposition
proposition
proposition HighHigh
High performance phone;
performance
performance phone;
phone; Easy,
two
Easy,
Easy,
EOU
free-of-
free-of-
free-of-
phones EasyEasy
Easy repair of Material Easy
repair
repair of of EasyEasy
recycling
recovery
recycling
recycling
……………………
……………………
replacement
………………………………
………………………………
parts
low LCC; reparability ………………….…..…
…………………......…
charge shipping
Teqcycle
…………………. phones ……….……….
…………………. ……….……….
(e.g. gold)
of phones
……………………
…………………… ………………………………
………………………………
low low
LCC; LCC; reparability
reparability …………………......…
…………………......…
charge
charge shipping
shipping ………………….
…………………. phones
phones ……….……….
……….……….
of of
phonesphones
Value proposition
Customer segments High performance
Private phone;
individuals; firms; Easy, free-of- Easy repair of Easy recycling
Customer
Customer
segments
segments All Fairphone
……………………
……………………
Private
Private
low individuals;
individuals;
………………………………
LCC;
………………………………
firms;
firms;
reparability …………………......…
All All
Fairphone
charge Fairphone
shipping ………………….
phones
…………………. ……….……….
of phones
……….……….
Customer segments ……………………
……………………
public
………………………………
………………………………
public
public
organizations
organizations
organizations ……………………...…
……………………...…
……………………...…
customers
customers
customers ………………….
…………………. ……….……….
……….……….
Relationships
Relationships
Relationships
Private individuals; firms;
Community-based,
All Fairphone Collaborative
Community-based, Collaborative Collaborative
customers/partners …………………… ………………………………
public organizations
Community-based,
Community-based, ……………………...…
Community-based,
Community-based,
customers ………………….with Teqcycle……….……….
Collaborative Collaborative
Collaborative
customers/partners
customers/partners
Relationships ……………………
…………………… ………………………………
transactional with customers
…………………… transactional ……………………..…
transactional ………………….
………………….
………………….
withwith Teqcycle
Teqcycle …….………….
…….………….
…….………….
with with
with Teqcycle
Teqcycle
Teqcycle
………………………………
transactional
withwith
……………………..…
……………………………… ……………………..…
customers
customers
Community-based,
transactional
transactional
Community-based, Collaborative Collaborative
customers/partners
…………………… ………………………………
transactional with customers
……………………..…
transactional ………………….
with Teqcycle …….………….
with Teqcycle
VALUEVALUE
VALUE CREATION
CREATION
CREATION
AND DELIVERY
DELIVERY
ANDAND DELIVERY
Production; ‘Sustainable’
Production;
Production; ‘Sustainable’
‘Sustainable’
VALUE CREATION value chain management,
AND DELIVERY value
value chainchain management,
management,
Production; ‘Sustainable’ Motivating return of Support EOL Support EOL
Sales; Shipping Motivating
Motivating return
return of of Support
Support EOLEOL Support
Support
EOLEOL
Key activities Sales;
Sales; Shipping
Shipping management management
KeyKey
activities
activities ……………………
…………………… ………………………………
value
………………………………
…………………… ………………………………
chain management, high-value phones
…………………........
high-value
high-value phones
phones ………………….
management
management
………………….
………………….
Support EOL ……….……….
management
management
……….……….
……….……….
Motivating return of Support EOL
Key activities
Fair-sourced
Sales; Shipping materials;
Fair-sourced
Fair-sourced materials;
materials; …………………........
…………………........ management management
Key resources/ ………………………………
…………………… Modular Modular phone design;
high-value phones
Collection scheme ………………….
…………………........
Design
Design
Design for for
for
……….………. Design for
Design
Design for for
KeyKey
resources/
resources/ Fair-sourced
Modular
phonephone materials;
design;
design;
………………….

978-91-87357-32-9
disassembly
capabilities
Key resources/ ……………………Software
……………………
…………………… ………………………………
Software ………………….....…
Collection
Collection
………………….....…
………………….....…
scheme
scheme
………………….
………………….
Design for
disassembly
disassembly ………….…….
………….…….
………….…….
Design recycling
for
recycling
recycling
capabilities
capabilities ………………………………
………………………………
Modular phone design;

number978-91-87357-32-9
Software Collection scheme
capabilities …………………… ………………………………
Software
Part manufacturer; Software ………………….....… Teqcycle for ………………….
disassembly
Teqcycle for ………….…….
recycling
Teqcycle for
KeyKey Key
partnerspartners
partners Part Part manufacturer;
manufacturer; Software
Software Teqcycle
Teqcycle for for Teqcycle
Teqcycle for for Teqcycle
Teqcycle for for
…………………… ………………………………
developers;
…………………… ………………………………
……………………
NGO’s ………………….…....
shipping
Teqcycle for ………………….
Teqcycle
………………….
………………….
resale
for ………….…….
Teqcycle
………….…….
………….…….
recycling
for
Key partners ………………………………
Part manufacturer;
developers;
developers; NGO’s
NGO’s Software
………………….…....
………………….…....shipping
shipping resale
resale recycling
recycling
…………………… ………………………………
developers; NGO’s
Sales via website and ………………….…....
shipping
Free shipping for …………………. ………….…….
resale recycling
Channels
Channels
Channels
Sales
Sales via website
via website and and FreeFree shipping
shipping for for
…………………… ………………………………
retailer
…………………… ………………………………
……………………
Sales
………………………………
via website and ………………..…......
Free users via website
shipping for ………………….
………………….
…………………. …….………….
…….………….
…….………….
Channels retailer
retailer
…………………… ……………………………… ………………..…......
………………..…......
users
users via via website
website
…………………. …….………….
VALUE CAPTURE
retailer ………………..…......
users via website
VALUE
VALUE CAPTURE
CAPTURE

Nußholz

J.L.K. Nußholz
VALUE CAPTURE

J.L.K.Nußholz
ISBNnumber
Production and operations Shipping
Costs Costs
Costs ……………………
Production
Production and and
………………………………
operations
operations
…………………......…
Shipping
Shipping
…………………. …….………….
Costs ……………………
……………………
……………………
Production and operations
………………………………
………………………………
……………………………… …………………......…
…………………......…
Shipping
…………………......… ………………….
………………….
…………………. …….………….
…….………….
…….………….

J.L.K.
Revenue flows Sales of phones and

ISBN
Revenue
Revenue
flows
flows Sales
Sales of ofofphones
phones
Sales and and
phones and
Revenue flows replacement
replacement
replacement
parts
parts
parts
replacement parts www.Fairphone.com
www.Fairphone.com
www.Fairphone.com
www.Fairphone.com
Who
Who can
can use
use the
the circular
circular business
business model
model planning
planning tool?
tool?
………………………………………………………………………………..…
………………………………………………………………………………..…
Business
Business developers
developers Managers to
Managers to develop
develop aa Researchers
Researchers to to Students to
Students to develop
develop
and entrepreneurs
and entrepreneurs common
common understanding
understanding study
study business
business understanding
understanding of of the
the
to
to develop
develop andand and
and language
language among
among models
models designed
designed interventions
interventions that
that
integrate
integrate innovative
innovative teams,
teams, internal
internal and
and for
for circularity
circularity and
and create
create circularity
circularity in
in
ideas
ideas that
that can
can external
external stakeholders
stakeholders analyze
analyze the
the business
business models
models and
and
increase
increase circularity
circularity of
of for
for effective
effective business
business model
model develop
develop own
own ideas.
ideas.
an
an offer
offer across
across the
the implementation
implementation of of elements
elements forfor each
each
life
life cycle.
cycle. business
business model
model cycle.
cycle.
innovations
innovations and
and
collaboration
collaboration processes.
processes.
 Additional
Additional Readings
Readings
………………………………………………………………………………..…
Nußholz, J. L. K. (2017). Circular Business Models: Defining a Concept and Framing an Emerging Research
Field, Sustainability, 9(10).

Nußholz, J. L. K. (2018). A Circular Business Model Mapping Tool for Value Creation from Prolonged
Product Lifetime and Closed Material Loops.. Special Issue Product Lifetimes and the Environment. Journal
of Cleaner Production.

Mont, O., Plepys, A., Whalen, K., & Nußholz, J. L. K. (2017). Business model innovation for a Circular
Economy: Drivers and barriers for the Swedish industry – the voice of REES companies. IIIEE at Lund
University, Lund

Osterwalder, A. & Pigneur. Y., (2010). Business Model Generation: A handbook for visionaries, game
changers, and challengers. Hoboken, New Jersey: John Wiley and Sons.
Acknowledgement

………………………………………………………………………………..…
This research was supported by the Mistra REES
(Resource Efficient and Effective Solutions) program,
funded by Mistra (The Swedish Foundation for
Strategic Environmental Research)

Contact
………………………………………………………………………………..…
International Institute for Industrial Environmental
Economics (IIIEE), Lund University

P.O. Box 196, 22100 Lund, Sweden

Telephone: + 46 46 222 00 00

Visiting address: International Institute for

Industrial Environmental Economics (IIIEE),

Lund University, Tegnérsplatsen 4, Lund,
Sweden

© Julia L.K. Nußholz

ISBN 978-91-87357-32-9