Developing circular business models in Chinese furniture industry

Chinese furniture industry is facing serious problem of limited virgin resources, environmental pollution and has an overall low profit rate. Implementing the circular economy in the industry is necessary and will contribute to its economically sustainable growth. Exploring and understanding these limited business models and conditions under which resource efficiency can be enabled and secured, especially the interrelations between barriers hindering the implementation and dissemination of circular business models, is needed. The research on the exploration and understanding of the implementation in reality could serve as a foundation to develop and refine the applied circular business models and then pave the way for a further and sound development of circular economy in Chinese furniture industry, and as well as its theory generation. This study seeks to explore and gain a better understanding of the concept of the circular business models in Chinese furniture industry via a process consisting of literature research, qualitative data collection through interviews, and case studies. Circular business models practice such as circular supply, product-as-service, product life extension, and resource recovery business modes are identified in Chinese furniture industry. Existing practices are facing barriers to scale up; meanwhile they show potential in terms of reducing raw material consumption, increasing resource efficiency and solving problem of environment pollution. Furniture manufacturing and process companies, furniture retailers and used products recycling collector, local governments and recovery and recycling companies are the main actors and stakeholders involved in the circular business models implementation. Barriers to the implementation and dissemination of circular business models in China’s furniture selling and recycling sectors were identified to be institutional, market based, organizational, individual and technological at both the external and internal levels. More barriers found at the external level, which market based ones dominate. Used furniture products related barriers are identified under technologies barriers sector as well. Barriers are varied with business models. Current China’s circular business models implementation is still at its early stage. More external changes are desired from all circular business models implementing companies, especially on policy related and on consumers’ behaviors