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Advancing the circular economy through dynamic capabilities and extended customer engagement: Insights from small sustainable fashion enterprises in the UK

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  • Patrick Elf
  • Andrea Werner
  • Sandy Black

Abstract

The circular economy holds the potential to significantly reduce resource use. However, attempts to fully utilize its potential have fallen short so far. Based on a longitudinal interview‐based study, we examine how micro, small and medium enterprises (MSMEs) in the UK fashion industry advance the circular economy (CE). Whereas the dynamic capabilities framework is mostly used for medium and large businesses, our findings advance the current literature, demonstrating how the distinctive development and use of dynamic capabilities enable MSMEs to act in agile ways, allowing them to introduce, test and advance CE solutions, while providing them with more resilience during times of crises. Our study further shows that fashion MSMEs adopt circular economy business models (CEBMs) by going beyond conventional, technology‐focused approaches currently dominating business thinking. The research highlights MSMEs' ability to engage in circular practices through an extension of existing business models in the form of close interactions with their customers demonstrating the importance and potential of extended business‐customer engagement in businesses' attempts to adopt CE practices.

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  • Patrick Elf & Andrea Werner & Sandy Black, 2022. "Advancing the circular economy through dynamic capabilities and extended customer engagement: Insights from small sustainable fashion enterprises in the UK," Business Strategy and the Environment, Wiley Blackwell, vol. 31(6), pages 2682-2699, September.
    • Handle: RePEc:bla:bstrat:v:31:y:2022:i:6:p:2682-2699
    DOI: 10.1002/bse.2999
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    2. Roberta De Angelis & Robert Morgan & Luigi M. De Luca, 2023. "Open strategy and dynamic capabilities: A framework for circular economy business models research," Business Strategy and the Environment, Wiley Blackwell, vol. 32(7), pages 4861-4873, November.
    3. Micol Barletta & Idiano D'Adamo & Jose Arturo Garza‐Reyes & Massimo Gastaldi, 2024. "Business strategy and innovative models in the fashion industry: Clothing leasing as a driver of sustainability," Business Strategy and the Environment, Wiley Blackwell, vol. 33(5), pages 4730-4743, July.
    4. Josephine Aboagyewaa-Ntiri, 2024. "Advancing Sustainability in Fashion Accessories: a Circular Economy Approach," Circular Economy and Sustainability, Springer, vol. 4(2), pages 1133-1151, June.
    5. Grego, Marica & Magnani, Giovanna & Denicolai, Stefano, 2024. "Transform to adapt or resilient by design? How organizations can foster resilience through business model transformation," Journal of Business Research, Elsevier, vol. 171(C).
    6. Rebecca Pera & Eliana Ferrulli, 2024. "Consumers' textile disposal practices and their perceived value in the circular economy: A platform focused ethnography approach," Business Strategy and the Environment, Wiley Blackwell, vol. 33(4), pages 2931-2948, May.
    7. Rajat Panwar & Eva Niesten, 2022. "Jump‐starting, diffusing, and sustaining the circular economy," Business Strategy and the Environment, Wiley Blackwell, vol. 31(6), pages 2637-2640, September.
    8. Navid Zarbakhshnia & Kannan Govindan & Devika Kannan & Mark Goh, 2023. "Outsourcing logistics operations in circular economy towards to sustainable development goals," Business Strategy and the Environment, Wiley Blackwell, vol. 32(1), pages 134-162, January.
    9. Ya Cheng & Mohammad Masukujjaman & Farid Ahammad Sobhani & Muhammad Hamayun & Syed Shah Alam, 2023. "Green Logistics, Green Human Capital, and Circular Economy: The Mediating Role of Sustainable Production," Sustainability, MDPI, vol. 15(2), pages 1-22, January.
    10. Hellström, Daniel & Olsson, John, 2024. "Let's go thrift shopping: Exploring circular business model innovation in fashion retail," Technological Forecasting and Social Change, Elsevier, vol. 198(C).

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