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Towards resource efficiency via business model innovation

The modern consumer economy has a fundamental flaw that promotes unsustainable consumption: the more companies sell, the more they earn. Turntoo, a Dutch company, has been building its business model based on an alternative system in which products are not sold by the producer to the consumer, but remain the property of the producer throughout their life cycles.

The Turntoo model fits into the broader trends of product service systems or extended producer responsibility which integrate services into a product offering. One example is the use of photocopiers or printers by businesses: companies lease the office equipment and pay per print, while the supplier of the printer or photocopier guarantees that the facility will be constantly available.

This approach promises several environmental benefits:

  • Because producers retain ownership of a product and derive their profits from its use rather than its sale, they have an incentive to make the product as durable and efficient as possible, so that it can be used as many times as possible before it has to be replaced.
  • Producer ownership means that once a product reaches the end of its life, the producer will collect it and reuse it. In effect, this will prevent products from becoming waste. Instead they can be disassembled and re-enter the production loop, reducing the demand for virgin raw materials.
  • Because products will be disassembled and reused at the end of their lifecycles, producers have an incentive to make them as reusable as possible. Ideally products should be designed to be broken down into easily-reusable components or raw materials.
An excellent example is the agreement, organized by Turntoo and signed in June 2012, between German precision engineering giant Bosch and Eigen Haard, an Amsterdam social housing provider. Bosch will provide washing machines to Eigen Haard tenants, who will initially pay €10 per month for the washing machine service (including energy and water). Later, tenants will pay per wash.

Benefits for tenants would include access to top-end washing machines with high energy efficiency ratings that they otherwise wouldn’t be able to afford, while Bosch will profit from more stable demand cycles and transparency on the flow of recyclable and reusable materials.

Turntoo was started in November 2010 by Sabine Oberhuber and architect Thomas Rau, according to whom products should no longer be regarded as commodities to be bought and sold. Instead, they should be considered “resource banks,” with the resources that they contain being constantly reused. For Rau, owning a product as a consumer is not important, only the performance, such as sufficient light, comfortable seating, or good audio and vision.

Turntoo is currently exploring the “resource bank” concept through a small number of early-stage projects that connect with Rau's architectural practice.

Further information:

Source: http://ec.europa.eu

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