# The Procurement Agenda for the Transition to a Circular Economy
## 3 Circular Procurement
### Circular Procurement
#### 3.2.1 Circular Procurement Strategies  
Organizations adopting formal policies to embrace procurement circularity is essential to introduce a circular economy. [PERSON] et al. [15] suggest that buyers should engage with the suppliers to identify circular solutions, and there should be a focus on product design to integrate the reduce, reuse, and recycle principles [15]. Circular procurement is an incentive for circular products and services. This could be achieved, for example, by assigning higher points to products with a higher percentage of recycled content or extended warranty (circularity) [8]. Another approach is to buy the functionality of a product by leasing instead of buying it [8]. This approach is also known as the servitized business model, and it entails translating the needs of product specifications into functional requirements [8]. Circular procurement could be implemented on three levels: 1. system level, 2. supplier level, and 3. product level. The system level is basically the contractual arrangement of the agreement; for example, leasing equipment rather than buying it, where the supplier takes back the equipment at the end of the agreement term to remanufacture or refurbish the product to resell it. The supplier level focuses on the supplier system and to what extent it embraces circularity. For example, the supplier has a system to reuse or recycle returned products. Finally, the product level focuses on the design and specifications of the product itself, for example, if the product can be recycled or disassembled after use [4]. To implement circularity in procurement, two strategies can be pursued [10]:  
* Promoting circular supply chains by procuring more circular products, materials, and services;
* Promoting new business models based on innovative and resource-efficient solutions. The first strategy entails developing and using \"circular\" procurement criteria in tender specifications. The criteria could cover the following:  
* Meet specified resource efficiency levels on a whole lifecycle basis;
* Include recycled content;
* Incorporate the potential for separability;
* Limit/eliminate the use of hazardous chemicals and ensure the nontoxicity of components;  
In addition, product lifetime extensions can be promoted through the following:  
* Reuse: if the lifetime of a product exceeds its contract term, it could be shared or sold;
* Repair/refurbish: refurbishing or repairing could be an option in the tender specification;
* Remanufacturing: At the end of the contract, products can be dismantled and renewed, and some of their components can be remanufactured;
* Recycle: materials can be extracted by components of a product for recycling. The second strategy, which is promoting new business models based on innovative and resource-efficient solutions, includes shifting from ownership to \"access to services.\" The following options can be considered [10]:  
* Product-Service System (PSS): customers do not demand products but seek the utility that is provided by products and services. PSS integrates products and services to deliver value rather than resources [37]. For example, instead of buying a printer, the customer buys printing services by leasing or renting the printer. This could decouple economic growth from consumption;
* Supplier take-back systems: this could be in the form of a \"purchase and buy back\" or \"purchase and resale\" agreement. It encourages refurbishment and remanufacturing or a third-party purchase of the product from the user and gives the product a second life;
* Sharing platforms/collaborative consumption and sharing economy services: optimizing the use of underused assets via shared use. Simplified access can consequently lower demand for new products.