Transition of business companies to circular economy in Slovakia

Integration of the circular economy system and its elements into business activities present new business opportunities. Despite the fact that circular economy represents a global trend, most industrial branches are based on the structure of a linear model. A system of circular economy has been gradually gaining ground in the business activities of companies functioning in Slovakia in different industries, including the clothing and textile industry. Transformation to the circular economy will be a necessity resulting from the legislative changes, as well as the pressure of public opinion. Our article focuses on this issue mentioned above. The main goal of the article is to explain the principles of the transition of companies operating in the textile and clothing industry from the linear to the circular economy and their potential for such a change and define the benefits of such a new business strategy for companies in Slovakia. In order for companies to be willing to switch to a circular economy, it is necessary to address the potential of the market and know the opinion of companies in the transition to a circular economy. To determine the market potential, we used ex ante forecasting using Holt's linear exponential smoothing, which showed us the growing trend of revenues in the textile industry, which can be an important factor for companies. In order for the transition to the circular economy to be successful, it is important to know the opinion of companies on the limitations and problems associated with the circular economy. To assess the opinions of companies, we worked with cluster analysis using the centroid method. The cluster analysis pointed to an implementation problem in almost 70% of the companies surveyed. Despite that all companies from the first cluster regard the circular economy as a new business model. However, it will be necessary to create adequate conditions for these companies to make the transition to the circular business models easier or possible. This primarily concerns adequate legislation and business operators’ awareness of both positives and negatives connected with the transition to such a business model.