Now that we know what a sustainable business is, what the business categories are, and having understood what a business model Canvas is and how to apply it to a sustainable business, it is time to understand why a sustainable business is profitable.
The application of circular practices allows us to develop a competitive advantage:
1) Cost reduction;
2) Access to public incentives and funds;
3) Access to more favourable tax regimes;
4) Increased staff productivity.
Furthermore, the application of circular practices will lead to increased profits through:
1) Connections and networking;
2) Resale of waste;
3) Resale of energy surplus;
4) Expansion of customer segment; and
5) Brand reputation and customer loyalty.
Deep Dive into Key Topics
Practical Application
Let's look at application examples in more detail.
A) Competitive advantage:
1. Cost reduction:
1.1.facilities cost: research, purchase and use of recycled materials, significantly reduce the costs of facilities and furniture.
1.2.energy savings:
1.2.1.adoption of autonomous clean energy production systems such as solar (photovoltaic), wind, and bioenergy.
1.2.2.reducing heating and cooling costs by implementing energy-efficient measures such as LED lighting, and high-efficiency heating and cooling systems, and by adopting optimising HVAC operations (where possible).
1.2.3.water management, and conservation by installing water sensors and conducting regular leak inspections. Adoption of efficient services, and replacement of traditional showerheads and faucets with low-flow models.
1.3.raw material costs: self-production of organic products, and or buying from the short chain and KM 0 (local producers).
1.4.waste reduction: reduce waste disposal and energy conversion through the adoption of composters.
1.5.operating costs: digitization of registration systems, data storage, internal communications, and publicity.
2. Access to incentives and public funding:
2.1.for conversion creation, renovation, and reconversion facilities
2.2.for machinery purchase and upgrade.
3. Access to favourable tax regimes:
the title of circular and (sometimes) organic farm, make, when possible, access to favourable tax regimes.
4. Staff productivity:
4.1.creation of a healthy work environment implementing sustainable practices can create a healthier and more comfortable work environment, boosting employee morale and productivity. (Check out one of the C-TOUR Digital Stories, a real-life example from Denmark: Langhoff & Juul Restaurant )
4.2.cost of attrition reduction by enhancing employee well-being can reduce turnover rates, saving on recruitment and training costs.
B) Increased revenue:Let's look at application examples in more detail.
A) Competitive advantage:
1. Cost reduction:
1.1.facilities cost: research, purchase and use of recycled materials, significantly reduce the costs of facilities and furniture.
1.2.energy savings:
1.2.1.adoption of autonomous clean energy production systems such as solar (photovoltaic), wind, and bioenergy.
1.2.2.reducing heating and cooling costs by implementing energy-efficient measures such as LED lighting, and high-efficiency heating and cooling systems, and by adopting optimising HVAC operations (where possible).
1.2.3.water management, and conservation by installing water sensors and conducting regular leak inspections. Adoption of efficient services, and replacement of traditional showerheads and faucets with low-flow models.
1.3.raw material costs: self-production of organic products, and or buying from the short chain and KM 0 (local producers).
1.4.waste reduction: reduce waste disposal and energy conversion through the adoption of composters.
1.5.operating costs: digitization of registration systems, data storage, internal communications, and publicity.
2. Access to incentives and public funding:
2.1.for conversion creation, renovation, and reconversion facilities
2.2.for machinery purchase and upgrade.
3. Access to favourable tax regimes:
the title of circular and (sometimes) organic farm, make, when possible, access to favourable tax regimes.
4. Staff productivity:
4.1.creation of a healthy work environment implementing sustainable practices can create a healthier and more comfortable work environment, boosting employee morale and productivity. (Check out one of the C-TOUR Digital Stories, a real-life example from Denmark: Langhoff & Juul Restaurant )
4.2.cost of attrition reduction by enhancing employee well-being can reduce turnover rates, saving on recruitment and training costs.
1.Connecting with the local community and other member organizations:
1.1.Interconnection of service offerings causing a broader offering.
1.2.mutual advertising
1.3.relations with local public authorities
2.Gain from resale of waste:
2.1.repurposing, reuse and internal recycling of the waste produced: basis for energy production, raw material for different processes.
2.2.sale of waste to other actors in the circular system
3.Gain from the resale of energy surplus: sale of energy surplus to energy companies
4.Expansion of customer segment:
4.1.identification of customer segment attentive to sensitive practices through basic behaviour pattern analysis.
4.2.targeting customer segments with greater willingness to pay.
4.3.supply of services to as-yet-unsaturated demand market.
5.Brand reputation and customer loyalty:
5.1.sustainability-focused marketing: highlighting sustainable practices can attract eco-conscious customers and enhance the business reputation.
5.2.increased customer satisfaction by offering higher-value sustainable products and services, leading to higher guest satisfaction and repeat business.
Project Database: we suggest the Danish Case 3 “Langhoff & Juul” again as project to be analyse, particularly their project 1 in which this Restaurant owner gives a very effective evidence of how to create a competitive advantage through a healthier distribution of working hours.
Interactive exercises/reflective questions
Exercise: Multiple choice
Exercise: Multiple choice
Exercise: Multiple choice
Further resources: videos and/or useful links
Digital Story:https://youtu.be/O0wpmQpsVvo?si=FhGN_5pbuY6Vn1oR
C-Tour Database: https://c-tour.eu/en/learning-platform/1/All
Global Sustainable Tourism Council (GSTC): Provides global standards for sustainable tourism practices and offers a wealth of resources to help tourism businesses adopt sustainable practices. Global Sustainable Tourism Council (GSTC) Website
C-Tour Database: https://c-tour.eu/en/learning-platform/1/All
Global Sustainable Tourism Council (GSTC): Provides global standards for sustainable tourism practices and offers a wealth of resources to help tourism businesses adopt sustainable practices. Global Sustainable Tourism Council (GSTC) Website
References
"Transitioning to a Circular Economy: An Exploration of Circular Business Models in Tourism": This article explores different circular business models and how they can be applied to the tourism industry to improve sustainability and profitability.
Journal of Cleaner Production
"Circular Economy in Tourism: Opportunities and Challenges": This paper examines the key challenges and opportunities for implementing circular economy principles within the tourism sector, providing insights into how tourism businesses can adapt to a circular approach.
Journal of Sustainable Tourism
"The Impact of Circular Practices on Tourism Industry's Environmental Sustainability": This article discusses the environmental benefits of circular economy practices in tourism, focusing on waste reduction, energy efficiency, and resource conservation.
Tourism Management
Journal of Cleaner Production
"Circular Economy in Tourism: Opportunities and Challenges": This paper examines the key challenges and opportunities for implementing circular economy principles within the tourism sector, providing insights into how tourism businesses can adapt to a circular approach.
Journal of Sustainable Tourism
"The Impact of Circular Practices on Tourism Industry's Environmental Sustainability": This article discusses the environmental benefits of circular economy practices in tourism, focusing on waste reduction, energy efficiency, and resource conservation.
Tourism Management
