Supply Chain Relationships in Circular Business Models: Supplier Tactics at Royal Smit Transformers

Marlies van Tilburg, Harold Krikke () and Wim Lambrechts
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Marlies van Tilburg: Department of Supply Chain & Sustainable Logistics, Royal Smit Transformers B.V., 6531 JC Nijmegen, The Netherlands
Harold Krikke: Department of Marketing & Supply Chain Management, Open Universiteit, The Netherlands, 6419 AT Heerlen, The Netherlands
Wim Lambrechts: Department of Marketing & Supply Chain Management, Open Universiteit, The Netherlands, 6419 AT Heerlen, The Netherlands

Logistics, 2022, vol. 6, issue 4, 1-24

Abstract: Background: Despite growing popularity, Circular Economy has not reached its full potential. One of the frequently mentioned success factors is the adoption of a Circular Business Model. However, fueled by (too) many constraints, its implementation is often hampered by so-called vicious cycles. Successful Circular Business Models require intensive collaboration between buyers and suppliers, with one of the key questions remaining who takes the initiative and leads the development: buyer or supplier? Methods: Through a single case study combining desk research, interviews, participative observations and analysis of vicious cycles, we investigate how supply chain relationships managed by the supplier can enhance the implementation of Circular Business Models. Results: We show that supplier tactics can relax constraints and break vicious cycles through (1) buyer–supplier relationship management, (2) functional integration of stakeholders and (3) incentive management. We also show that, due to supplier captive conditions, a number of enabling factors are indispensable, namely: (1) the availability of buyer incentives; (2) (joint experimenting to develop) circular knowledge; (3) sharing clear visions on circularity; (4) being transparent in possibilities; and (5) supply chain leadership. Conclusions: As a consequence, strategic trust-based partnerships are a prerequisite for turning vicious cycles into virtuous cycles. Future research should also investigate the role of the buyer, including buyer captive conditions, and how to shape supply chain leadership. Finally, the role of supplier tactics in relation to other success factors next to Circular Business Models needs to be further explored.

Keywords: circular business models; supply chain relationships; closed-loop supply chains; circular economy; supplier tactics (search for similar items in EconPapers)
JEL-codes: L8 L80 L81 L86 L87 L9 L90 L91 L92 L93 L98 L99 M1 M10 M11 M16 M19 R4 R40 R41 R49 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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