DLL Provides Insights on Compliance’s Effect on Circular Business Model

DLL released a new whitepaper measuring the business and operational impact of compliance when transitioning to a circular business model. The whitepaper includes a checklist to manage compliance.

A growing number of companies are transitioning to a circular business model in which equipment re-use, refurbishment, remanufacturing and recycling are key to the company’s strategy. The circular economy is a more regenerative and sustainable model that can move the industry away from the old linear ‘take, make and waste’ model. By designing products to be recycled, reused or remanufactured at the end of their first life cycle, manufacturers can help reduce pressure on the planet’s resources while creating second and third life revenue streams by moving assets into a new life. The concept of a circular economy favors usage over ownership. In usage-based models, manufacturers can maintain control of their equipment throughout its life and ensure that the equipment or materials are re-used, rather than sitting idle or being relegated to a landfill. Life cycle management is a crucial parameter of its success.

Compliance is often seen as a barrier to doing business. However, the impact of non-compliance has criminal, reputational and financial consequences. Businesses should safeguard their practices by making compliance a necessity.

Egbert de Jong, VP Product Development at DLL, said, “Through this whitepaper we aim to give insights into laws, regulations and standards that manufacturers, dealers and resellers should take into account when moving assets into a new life.”

Throughout its research, DLL focuses on three subjects that have major implications for life cycle management and the circular economy: data protection, recycling and cross-border shipment.

With assets becoming smarter, more connected and capturing and storing more and more (personal) data, data-wiping before an asset goes into a new life is becoming massively important to comply with data protection legislation.

The same goes for recycling and re-using. The interest in recycling and re-using is growing rapidly as more companies are adopting a circular business model. Consequently, more companies are involved in the dismantling of assets as well as the separation and disposal of toxic substances and components. Still, many companies are not aware of the extent hazardous substance regulations in order to manage this properly.

Finally, cross-border shipment is a necessary part of giving assets a second or third life, as pre-owned assets are commonly sourced from and sold to foreign markets. New rules and regulations are making this shipment more costly, time consuming and complex. Companies should consider carefully before exporting equipment abroad.

“The whitepaper details how circular business models can affect a business’s operations, as we believe education and transparency is fundamental in motivating companies to complement their business with second life manufacturing,” de Jong said. “In order to be successful, companies should be aware of the requirements that come along with it.”

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