From a Circular management perspective, the Product Life Cycle still has the five different phases shown in the graphic (with slightly different names but the same meaning). Here we will consider the different financial aspects related to each of them and we will highlight the action that a circular business needs to consider in each phase:
1. Development Phase. Apply the Circular Product Design that implies “design to last” and “green components” easy to reuse and recycle. There are some additional considerations when it comes to circular products, and also some extra costs. The raw materials need to be sourced, maybe even from local suppliers. And already in this phase you need to adapt the product for its end-of-life phase to be able to reuse as much as possible.
2. Launching Phase. Adopt the new rules needed to create long term cooperation agreements with circular providers (raw materials, services, etc.). The local aspect may be important, and the marketing activities should reflect the product, and be targeted at the customer segments likely to adopt the products. The story about the product may be just as important as the product itself.
3. Growing Phase. Circular commitment between parties, to ensure the continuous sales growth needed. Growing pace is now a network capability issue, not yours alone. So you need your partners' help to grow sales. Try to engage and activate your customers to help promote the brand and the product. Sell the story along with the product. Listen to the feedback and make sure that the changes made to the products reflect that, and it is communicated.
4. Maturity Phase. Understand Product Life Extension through maintenance and repairing. Making good on the circular promise to extend product life should be easy, affordable and have economic sense for you and for your customer. As with other products in this phase competition might be rising, forcing a price-based competition. But a circular product should be more robust against other similar products, in that the customers are buying into the story of the product, as much as the product itself. And in addition existing loyal customers are able to keep the story flowing by promoting it to others. Be sure to reward this behaviour.
5. EOL Phase. Define the Take-Back System for recovering and reintroducing EOL products as new raw materials. Study of compensation systems for the customers. Recycling capabilities for materials not able to be reintroduced in the production process. Make sure that the take-back process is, above all, easy for the customer to use. Customers of circular products have shown to value convenience much higher than fiscal compensation when returning a used product to the next in line. Handing over your old products to refurbishment and reuse is in itself a part of the circular idea that the customers have bought into.
