Access-Based Business Models: More Relevant Than Ever Thanks to the EU's Right to Repair Law.
.png)
The EU's new right to repair law aims to make it easier for consumers to repair their products, thereby promoting sustainability and reducing electronic waste. Why is it relevant? Because the amount of e-waste produced globally is substantial and continues to grow each year. Here are some key stats.
Global E-Waste Generation.
Global E-Waste Generation (2021):
- According to the Global E-Waste Monitor 2021, approximately 57.4 million metric tonnes (Mt) of e-waste was generated worldwide in 2021.
- This represents an increase from 53.6 Mt in 2019, highlighting the ongoing growth in e-waste generation.
E-Waste Growth Rate:
- The growth rate of e-waste generation is estimated to be about 2-3% annually, driven by increasing consumption of electronic devices, shorter product lifespans, and technological advancements.
Regional Distribution.
- Regional Variation
- Asia generated the highest amount of e-waste in 2021, with approximately 24.9 Mt (43.4% of global e-waste).
- Europe and the Americas followed, contributing 13.5 Mt (23.6%) and 13.1 Mt (22.9%) respectively.
- Africa and Oceania generated smaller but significant amounts of e-waste, with 2.9 Mt (5.1%) and 3.0 Mt (5.2%) respectively.
- Per Capita E-Waste Generation:
- Northern Europe and Oceania have the highest per capita e-waste generation rates, with over 16 kg per person.
- The global average per capita e-waste generation was approximately 7.5 kg per person in 2021.
Management and Recycling.
- Recycling Rates
- Despite the growing volume of e-waste, only a fraction is formally recycled. In 2021, it was estimated that only 17.4% of e-waste generated globally was documented to be collected and recycled properly.
- The remaining e-waste is often disposed of improperly, contributing to environmental and health risks.
- Challenges in Recycling
- Challenges in e-waste recycling include inadequate recycling infrastructure, lack of formal collection systems, informal recycling practices with health risks, and the complexity of separating valuable materials from electronic devices.
As a response to this, the European Union is stepping up its game in the battle against electronic waste and unsustainable consumption with its ambitious right to repair law.
This legislation is set to transform how we think about ownership and maintenance of our gadgets and appliances. By mandating that products be easier to repair and maintain, the EU aims to extend the lifespan of consumer goods, reduce waste, and promote a circular economy.
Challenge: This brings us to an intriguing question: how can businesses adapt to these new regulations in a way that benefits both them and their customers?
Solution: The answer might lie in a fresh and innovative approach to product consumption — access-based business models.
This model isn't just a win for sustainability; it's also a smart business strategy that aligns perfectly with the EU’s green agenda. Let’s explore how these models can help meet the various components of the right to repair law, creating a harmonious blend of compliance, customer satisfaction, and sustainability.
1. Enhanced Product Design and Feedback Loop
Real-Time Usage Data:
- Access-based models provide continuous real-time data on how products are used, which can feed directly into design improvements for repairability and durability. This feedback loop ensures that products are constantly evolving based on actual user experiences.
Iterative Improvement:
- With access-based models, companies can rapidly iterate on product design, focusing on common issues and enhancing repairability. This continuous improvement cycle is harder to achieve in a traditional sales model where feedback might be limited.
2. Streamlined Spare Parts Management
Predictive Maintenance:
- Access-based models allow companies to monitor product health and predict when repairs are needed. This proactive approach means spare parts can be managed more efficiently, ensuring availability and reducing downtime for users.
Centralised Inventory:
- Maintaining a centralised inventory for an access-based service is more manageable and cost-effective. Companies can bulk order spare parts and distribute them as needed, which can reduce costs and improve repair turnaround times.
3. Comprehensive Repair Infrastructure
In-House Expertise:
- Companies offering access-based services can develop specialised in-house repair teams, ensuring high-quality, standardised repairs. This contrasts with the variability of repairs done by third parties in a traditional ownership model.
On-Demand Repairs:
- With access-based models, companies can offer on-demand repair services, where technicians come to the customer’s location, enhancing convenience and customer satisfaction.
4. Customer Empowerment and Satisfaction
Lower Costs for Consumers:
- Customers save money by not having to purchase expensive products outright. Instead, they pay a subscription fee that often includes maintenance and repairs, which can be more predictable and manageable financially.
Convenience and Flexibility:
- Access-based models offer greater convenience and flexibility, allowing customers to switch or upgrade products as needed without worrying about disposal or resale.
5. Environmental and Social Responsibility
Extended Product Lifecycle:
- Access-based models naturally align with the principles of the circular economy. By keeping products in use for longer through maintenance, repair, and eventual refurbishment, these models reduce waste and environmental impact.
Sustainable Practices:
- Companies are incentivised to design products that last longer and are easier to repair since they retain ownership and bear the costs of maintenance and end-of-life management.
Extra Perks for Businesses
Revenue Streams and Customer Loyalty: Access-based models create steady revenue through subscriptions or rentals. Plus, regular interaction with customers builds stronger relationships—think of it as the Netflix effect for physical products.
Brand Reputation and Market Differentiation: By leading the charge in sustainability and innovation, companies can stand out in the crowded market. It’s not just good for the planet; it’s great for business.
Tech Integration
IoT and Predictive Maintenance: Using IoT tech to track product usage can provide detailed data for predictive maintenance. It’s like having a smart assistant who knows when your toaster is about to give up the ghost.
Overcoming Challenges
Transition Costs and Logistics: Shifting to an access-based model isn’t a walk in the park. But by rolling it out gradually and leveraging existing infrastructure, companies can smooth the transition. Partnering with third-party service providers can also help manage repairs and maintenance.
Looking Ahead
The marriage of right to repair laws and access-based business models is just getting started. Expect more innovations in product design, maintenance tech, and business strategies. Companies that get ahead of the curve will lead the charge towards a more sustainable and consumer-friendly future.
Conclusion
The synergy between the EU’s right to repair law and access-based business models is a match made in eco-heaven. By focusing on repairability, spare parts availability, and sustainable practices, these models ensure regulatory compliance while enhancing customer satisfaction. As businesses adapt, this dynamic duo will drive innovation and create resilient, eco-friendly market solutions. So, get ready to borrow, fix, and save the planet—one subscription at a time.
About circuly
circuly is a subscription management software solution that enables manufacturers and retails of consumer durable products to launch, manage and scale a rental, lease or subscription model for physical products. With the help of the circuly solution, retailers and manufacturers of consumer durable products can make their business circular, add a recurring revenue stream, extend the product lifecycle, reach new customer segments and achieve their sustainability goals. circuly makes the process of renting products online as seamless and scalable as traditional sales, revolutionising the way businesses operate in the digital landscape.
.png)
%20(4).png)
.png)
.png)
