Critical success factors for circular business models within the agricultural sector

In the transition from a linear, ‘take-make-dispose' economy to a sustainable usage of all renewable resources in circular or cascading ways, stakeholders' strategies striving for value creation are adapted. Implementing a circular economy requires a change at a system level, involving all actors of value chains within diverse economic sectors. At an enterprise level, innovative business models are needed that offer market opportunities for new products. Circular business models deal with the question of how to create, deliver and capture value with and within closed material loops. We aim to understand under which conditions new business models within the agricultural sector successfully contribute to a circular economy. 33 cases have been studied and semi-structured interviews have been performed, in order to investigate critical success factors. Results show that various success factors exist, which can be grouped in five categories: (1) technical and logistic, (2) economic, financial and marketing, (3) organisational and spatial, (4) institutional and legal, and (5) environmental, social and cultural factors. Findings indicate that the transition to a circular economy in the agricultural sector let individual business models evolve towards dynamic and integrated business models in which the macro-environment sets the boundary conditions for successful operations. Moreover, there is a high degree of interactions between all actors in the circle. This implies that not only an individual companies' business model is impacted, but that a new, integrated business model for all circle actors is required, asking for an open and flexible management and a transparent communication.