Product chains

Emil Urhammer

Circular economy is mainly concerned with how so-called product chains can be transitioned so they create more value with fewer resources and less pollution. Product chain is a term that describes the life cycle of a product from the extraction of the materials used to produce it and the energy involved in the production until it ends up as waste in a landfill site or, as demanded by the circular economy, is reused or recycled. Such a process is called a product chain because it can be seen as a connected chain of value that is added through processing and design. To take a simple example, coffee, it is possible to say that the total product chain for coffee starts at the coffee plantation in South America or Africa and ends in rubbish bins in Denmark, where the coffee grounds end up after the coffee beans have been harvested, roasted, packed, transported, ground and brewed. At every step until the coffee has been drunk, value is added, but this stops once the coffee becomes grounds. The coffee is worth more once it has been picked than when it was still on the tree, just as the roasted beans are more valuable than they were before the process, etc.

However, coffee is a very simple example, which primarily illustrates the principle of added value, but even in such a relatively simple product chain as coffee there is potential for establishing circular upgrades. For example, in Denmark, coffee grounds have been used to grow mushrooms such as oyster hats, which can be sold and used in cooking. This is an example of how the biological cycle of coffee can be extended.

If you take a more advanced product such as the mobile phone, for example, the story becomes immediately more complicated, while the potential for circular upgrades also increases. A mobile phone is made up of a wide variety of materials such as metals, minerals and plastic, which through a linear product chain end up at a landfill site or in a combustion plant, if the phone does not end up in a loft to serve no purpose. According to circular thinking, however, all these materials should be included in new product chains, thereby remaining in the economy rather than becoming waste or lying somewhere unused. The simplest way to do this is by extending the life of the mobile phone by as much as possible so that the buyer keeps it for as long as possible, sell it or give it to someone else instead of throwing it away when she does not want to keep it any longer. The next option is to dismantle the phone into smaller parts, each of which can be included in new products. However, this approach demands a well-thought-out design to determine how the individual components can be removed and included in other products. Finally, the basic elements of the phone such as metals, minerals and plastic can be ‘extracted’ from the phone and included in new product chains. However, the problem with this approach is that it can be very difficult to remove the individual materials once they have been assembled into complex devices. Therefore, there is a limit to how much can be extracted, although this problem can be partially remedied with smart design solutions and advanced extraction technology.

[otw_shortcode_info_box border_type=”bordered” border_style=”bordered”]Life Cycle Assessment
In order to investigate how well a particular product meets the ambitions of the circular economy, a so-called Life Cycle Assessment (LCA) of the product can be conducted. An LCA not only examines production at a single factory or company, but instead examines the entire product chain from the extraction of raw materials until the product is discarded. A good example is bottled water from France. In order to conduct an LCA of bottled water from France, you need to investigate the following:

  • The environmental costs associated with pumping the water.
  • The environmental costs associated with producing the plastic bottle.
  • The amount of water and oil involved in producing the bottle.
  • The amount of transport involved in the overall process from the water being pumped up in France until it is in plastic bottles in Danish supermarkets.
  • The environmental problems created by the bottle after use.
  • Where the bottle ends up after use.
  • How likely it is that the bottle will end up as plastic waste in the ocean.
  • The amount of CO2 emitted if the bottle is burned.
  • The amount of CO2 that is emitted during the entire production process.

Once this analysis has been conducted, it is possible to start identifying opportunities for making the product chain more circular, by asking, e.g.:

  • How can transport be reduced?
  • Can the bottle be reused as a drinking bottle?
  • Or is it better to use the plastic for new plastic products?

In the case of bottled drinking water, the most circular solution is to switch to Danish tap water instead. This would avoid all the environmental problems associated with transportation as well as the production and disposal of the bottle after use.

You can read more about life cycle assessment here:

Next: The circular economy is not the same as ecological economics