This model consists of taking back a product sold to a customer when the product reaches the end of its life or when the user wants to get rid of it. At the time of the take-back, the company can recover the product free of charge or pay a financial consideration to the customer. This model is part of a circular economy logic because it allows the environmental footprint of products to be reduced by reducing waste. Indeed, the company that recovers the products can then recycle them into other products or simply repackage them for resale.
Advantages & Challenges:
This business model facilitates the sale of the second-hand product. For companies, it can allow them to broaden their customer portfolio, reduce costs, reduce waste and increase their revenues through the reuse of raw materials to create new products or through the resale of reconditioned products. For customers, this business model allows them to get rid of a product they no longer need, while at the same time recovering a financial reward and saving time as they no longer need to worry about their waste. The challenges related to this model are the logistics costs for recovery, the costs of reconditioning or recycling, the additional R&D costs related to the end of the product's life. For the customer, this business model can be unprofitable and difficult to achieve, or the products can be of poorer quality.
Evolution & Maturity:
The current period has allowed the Take Back business model to spread, thanks in particular to the growing awareness of the interrelated ecological and economic issues of waste reduction and resource reuse. The advent of the digital age may allow the take-back model to develop by making possible automated and digitised interactions between the user and the manufacturer.
According to the European Commission, each point of improvement in resource productivity could save European companies up to €23 billion a year and create up to 150 000 jobs.
Products & Services:
Electronic products and mechanical parts are very suitable for this business model, as they are products that are easy to recondition, or with reusable components (rare materials). On the other hand, the textile industry also uses this business model, with the reuse of clothing to recreate raw materials.
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