Barriers to the circular economy are diverse and many are business model-specific: Evidence from the Australian cheese manufacturing sector

The pursuit of Sustainable Development Goal 12.3, aimed at halving food waste by 2030, relies on a concerted effort from various stakeholders to engage in different practices that improve the utilisation of resources throughout the life cycle of a product. Circular business models (CBMs) have emerged as a promising avenue for achieving this goal by acknowledging there are multiple pathways that can contribute to the same outcome. CBMs can reduce the inputs into and/or waste and emissions from supply chains via a range of management practices, organisational configurations and part of broader value networks.

This study seeks to contribute to the growing body of literature on CBMs by examining the diverse barriers across different types of business models. To explore these barriers in-depth, we thematically analysed semi-structured interview data from the Australian cheese manufacturing sector. Our research reveals that adopting various types of circular business models have, and can mitigate to an extent, different types of barriers. We find that when firms consider in-house management practices, they predominantly faced internal barriers. These internal hurdles include technological constraints; financial viability concerns; and organisational challenges, such as competing priorities and timing issues with the business cycle. The exploration of alternative business models, such as selling to or forming partnerships with other firms, offers a contrasting picture. In these scenarios, firms tend to report predominantly external barriers that are closely tied to supply chain dynamics. These external barriers include geographical remoteness, a lack of industry coordination, and ambiguity surrounding the distribution of costs, benefits, and responsibilities.

These findings have the potential to assist with decision-making within the cheese manufacturing sector and other industries facing similar issues. By highlighting the differences in barriers faced across various circular business models, our study underscores the importance of exploring multiple pathways to achieve the same goal, while also identifying residual issues that will need to be addressed – e.g., industry coordination, clear business plans, etc.