Last month I was lucky enough to attend a Masterclass that shifted my opinion about the circular economy and provided me with the resources to build an effective business model that supports the global sustainability agenda. With the hospitality industry being one of the biggest drivers of climate change and biodiversity loss, small businesses need to adapt their operations.
The circular economy is becoming an increasingly common term, but what does it really mean? And how, as small business owners, can we integrate this concept into the heart of our organisations? These looming questions were at the forefront of my learning agenda.
The “Building Sustainable Food Systems” Masterclass was put together by Metabolic: a consulting and venture-building company, which uses systems thinking to tackle major sustainability challenges. A focus of its work is the circular economy.
The event itself was led by Oscar Sabag Muñoz, a Metabolic consultant and systems thinking expert who helped us connect climate change, biodiversity loss, and future food insecurity to unsustainable business practices and a series of entrenched structural problems that cause those practices.
From this vantage point, he led me and my fellow learners on an immersive journey through our food system.
In short, the hospitality industry’s dependency on an unsustainable food and agricultural system perpetuates climate change and accelerates biodiversity loss. This creates a need - and an opportunity - to build cohesive new systems.
These systems need to be integrated into our business operations to enable sustainable growth and innovation across the processes and infrastructures necessary to feed a growing population.
Oscar strategically guided us through the drivers of these problems and where leverage points exist to create change.
As business owners of all stripes are becoming more conscious about the drivers of this change, the circular economy has been given a great deal of attention. This concept is defined as “regenerative and waste-free by design”. It is one where businesses aim to create products and services that are designed around waste, and where negative impacts on people and the planet are minimised.
I adopted this principle three years ago when developing my own first business, The Grassy Bowl. With almost 30% of food in the hospitality industry thrown out as waste, my business aimed to be as waste-free as possible and set an example for other small businesses.
The Grassy Bowl was a 1962 Kombi Van restored into a portable offering of plant-based Australian indigenous cuisine. In using local produce, fermenting organic waste, using recyclable disposables, and reclaiming materials for the build, the business was designed around a closed loop nutrient cycle. Let's consider this a microcosm of the circular economy, a circular business model by design.
While The Grassy bowl was designed around a closed loop nutrient cycle, Metabolic's Masterclass helped remind me that waste management is fundamental, but isn't everything. As Metabolic explains, using systems thinking to focus on the relationship between elements and how these lead to changes over time, rather than reducing it to individual parts in isolation can help us understand the complexities of our problems and where our opportunities for impact lies.
By solely focusing on material recirculation, we overlook other fundamental aspects of the circular economy. As you can see in the above diagram, 30% of Greenhouse Gas emissions come from the food industry. Here, we may want to consider a focus on less land-intensive products. An example could be using crickets instead of cows as a protein source (see below). Please refer to my website for interesting recipes and ways of incorporating these highly nutritious and sustainable delicacies into your diet.
While I had good intentions, the recovery of materials used for the restoration of my van, or in manufacturing biodegradable bowls were extremely costly and energy-intensive - something the masterclass has helped me consider more for the future.
It's quite a simple realisation - but by focusing on one part of the system, such as materials, it is difficult to see the broader problem. As such, the more issues you can run into down the line - from financial costs in a small business to larger social or environmental costs. Here, we need to see our businesses as a web of interdependent parts of one operation.
In order to do this, we need the knowledge to build holistic circular business models. Metabolic’s seven pillars of the circular economy summarise these deep issues, to include waste management as well as energy, biodiversity, human society and culture, health and wellbeing of humans, value beyond financial, adaptable economic system. Below these drivers are explained.
Eva Gladek, Metabolic’s co-founder, suggests businesses who use not one but all seven of these pillars, will be the ones who not only survive but rise to the top.
While I sadly had to let go of my Kombi last year, that may not have been the case if I knew more about this business model. Without a model such as this, it becomes really easy for businesses to lose sight of the larger, global problems and the tumultuous environment they inadvertently create.
With the right guidance and mentoring the business could have thrived. I’m sure I speak on behalf of many small business owners when I say that masterclasses such as this are of huge benefit to regain confidence in your idea, and strategically plan for the future. Fostered by a supportive network of like-minded individuals, all with a common goal to support the environment, not destroy it.
The class was perfectly wrapped up with 4 clear elements on how to design a sustainable business model. While I wish I knew these steps when designing my business model, I hope they can assist other small business owners to avoid the problems I faced.
1. Identify your sustainability challenge
2. Identify the key system dynamics underpinning it
3. Define a holistic circularity strategy to include all 7 pillars of the circular economy
- Assess your material flows: Compare what alternatives are more sustainable per land and nutrient use. For instance, using crickets instead of cows as a protein source.
- Only use what you need even if it’s biodegradable, or recyclable- it still takes energy to make. Use renewable energy where possible and be conscious of your energy consumption, full stop. It's cheaper and more easily implemented than ever before.
- Stick to the system: Building models designed for maximum energy efficiency without compromising performance and service output of the system.
- Understand and preserve the local habitat you are operating in: Especially rare habitats, should not be encroached upon or structurally damaged through human activities - only using small-scale farms to combat biodiversity loss.
- Preserve your culture: Human society and culture are preserved - using native ingredients and inspired by cultural dishes.
- Use your business to educate: keeping the local community educated about healthy eating practices.
4. Select multiple interventions
As Oscar noted in step 3 of the planning, the seven pillars are idealised features that may not be all attainable simultaneously, but they provide a specific set of targets we can aim for collectively to reduce waste, pollution, energy consumption, and our reliance on virgin materials. This process will essentially enhance the efficiency of your business, and the future state of the global economy.
I hope to see Metabolic continue to expand their Masterclasses into the hospitality industry, so budding business owners like myself can learn more about systems thinking and remain agile and profitable in an ever-changing environment.
Here are a few hacks to minimise energy consumption through food design:
To find out more about Metabolic and the circular economy please visit: https://www.metabolic.nl/