The 5 Common Obstacles in Implementing Circular Economy

Circular economy is the new trend. The term is spreading and everyone is expected to (at least) understand the concept because we all know that the implementation is not always easy.

The institution that coined the term ‘Circular Economy’, Ellen Macarthur Foundation, was founded in 2009 with one intention: to accelerate the transition to a circular economy. Besides developing and promoting the circular economy concept, the foundation also works with businesses, policymakers, and academia to globally implement the solutions.

Yes, the implementation of the circular economy concept doesn’t stop at education and introduction, there are difficult changes that need to be made, and that’s why the support of all the stakeholders are important.

Yes, circular economy is mainly about how we manage our waste, but according to an article from World Resources Institute, there are 5 things that we all must think about when implementing the circular economy:

#1 The horror of disrupting consumer’s convenience

One of the common cases is the use of disposable plastic. There are many kinds of plastic, all  Most of us have grown accustomed to the simplicity of it, that we are likely difficult to separate from its flexible, lightweight, and impermeable qualities.

Say, a producer of mineral water products wants to change its packaging into a more environmentally-friendly material. They might think to change it into a paper-carton: still lightweight but easily broken when in touch with solution or water, so no. Elegant glass bottle: impermeable but a bit too heavy for a bigger size option.

Woman checking food labeling
Woman checking food labeling – source: Packaging Insight

For each of the advantages of plastic bottles that the company is willing to let go of, there’s a chance that the consumers might find it too inconvenient and choose a simpler choice instead: the competition’s products with disposable plastic packaging.

This is why most of the circular economy implementation must be preceded by thorough market research and education for both the producers and the consumers on why we need to manage our resources in a circular kind-of-way: the kind that leaves almost no waste or pollution to the environment. 

#2 Local regulations versus the circular economy concept

The circular economy concept has been introduced by the Ellen Macarthur Foundation in 2009, and yet, the term has just hit the Indonesian market in 2018-2019. There are more spikes of google search history for the word ‘circular economy’ and ‘ekonomi melingkar’ starting from the year 2018.

10 years were needed for the term to reach the local waste management actors. One of Indonesia’s circular economy initiators is Indonesia Circular Economy Forum (ICEF) that was annually held by the Greeneration Foundation since 2016. 

Several ideas were discussed: to prohibit the producers from pilling up their waste in the landfill, the new requirement of an environmentally-friendly business model to carry a business in Indonesia – most of them require support from the government.

All the local circular economy observers and actors are currently on their way to ask the government to standardize the national implementation of the concept. Let’s face it, not everyone has the capacity to understand the importance and urgency of it, so a strict regulation with clear boundaries is needed to kickstart the change.

#3 Lack of infrastructure for waste treatment

Regulation is just a set of words and ideas without the human resources and facilities to run it. We are certainly talking about the money, energy, and time needed to prepare all the necessities after the regulations are made. 

For example, according to, China is currently the #1 world’s plastic waste producer. If there are not enough plastic waste treatment facilities to make sure that the materials are ready to be used again in the industry, then what’s going to happen? The plastic waste will be accumulated in the landfill or dumped into the sea.

#4 Lack of recycling technology

There are materials that need higher recycling technology such as textile and the beverage cartons that we use to contain milk or juice. We could decide to limit the use of those materials, maybe natural cotton only for the fashion industry and glass or metal packaging to exchange the use of beverage cartons. But then what?

In order for the circular economy implementation to succeed, we need to make sure that the technologies needed to recycle the materials are enough to cover all the industries’ requirements – both in numbers and quality.

#5 Poor business model plan

The previous problems that we talked about: maintaining consumers’ expectations, government regulations, lack of waste treatment facilities, lack of recycling technologies, all come to one conclusion: we need a better business model plan, the one that implements the circular economy concept.

Creating a great business model plan from the beginning and fixing the already existing business model plan has its own challenges, ex: choosing the right online accounting software like Jurnal, might impact business in the long term. Some might choose to do the right thing from the beginning, but others might have no choice but to tear down some of the systems that are already running and rebuild. 

Business Model Concept. Chart with keywords and icons on white background – source: iStock

What We Can Do to Overcome the Circular Economy Obstacles

Let’s not get the priorities mixed together. In order for the circular economy implementation to succeed you need to make sure that:

  1. The people are ready to accept the change
  2. The government regulations are ready to monitor the change
  3. The waste treatment facility is ready to support the change
  4. The waste recycling facility is ready to execute the change
  5. The business model is ready to maintain the change sustainably

Now imagine that each of us tries to build an environmentally-friendly business from scratch, what would happen? 

Here’s what possibly will happen: we will need more time to reduce the number of unhandled waste. The waste will continue to pile up in the landfill and our sea, all waiting for us to be fully able to reduce the number of waste we generate.


The key to accelerating the change is by collaborating with other stakeholders. Better materials, a source of renewable energy, better connection to spread awareness, or are you looking for a great Extended Producer Responsibility waste management program? Great collaborations could help you to be a step closer to the circular economy.

We are all in this together, anyway.



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