Circular economy: Factors affecting the financial performance of product take-back systems

Abstract

Product take-back systems are fundamental for Circular Economy (CE) and focus on recovering value by taking back products to be recycled, re-manufactured, or refurbished. In theory, the expected value from CE is undeniable. However, in practice product take-back systems are often in small/pilot scale or have difficulties becoming financially viable, which is an obstacle towards the widespread adoption of CE in practice and thus a barrier to achieving a sustainable manufacturing system. This study uses a structured literature review to explore the factors affecting the financial performance of the product take-back system and investigate how 12 factors, clustered into three different dimensions; context, supply chain, and company, affect financial performance. Based on these findings, two propositions are made on how these factors are interrelated in a system perspective and how further research should build on these findings.