Circular Economy in Business Strategy of Manufacturing Company

Abstract

The business strategy is basically designed to maximize the profit of the company. Therefore, it is an important measure to maximize the profit calculated by the profit from one product and number of selling to the customers. The concern that comes from the former is reducing cost to make product, and that of the latter is reducing the cost from the multipronged operation. Most difficulties in circular production system have arisen from the little cost reduction margin which originated from the little freedom in selecting resources to make products. This fact that the freedom in circular system is less than simple linear model is essentially inevitable because the linear model can even use recycled resources. In this report our major concern is the latter part of cost. This part of cost is not negligible for getting big number of customers, and it is the basic spending in business operations out of direct manufacturing operations. The advantage of products of circular production system is implied in the sustainable production concept in circular system. The usable cost to get competitiveness could be allocated up to the ratio of cost of production toward the cost of the other part without reducing cost competitiveness. The feasibility is increasing in higher-value-added product as the portion of direct manufacturing cost is reducing.