As the purpose of this study is to answer how CE principles can transform the service value chain, the findings have provided information which makes it possible to draw conclusions.
Thus, it is evident that companies from various industries practices different CE strategies.
For instance, while Helthjem practices reduce through investing in a fleet powered by alternative fuel options and facilitating for CE among their customers, the other companies focus on reduce through waste and resource reduction. Helthjem’s aim at facilitating for CE
shows that a transport service provider is key in the CE, as they have provided easier access to for instance rent and repair services for consumers. The findings further indicate that the reuse strategy has some challenges, as some consumers tend to sell or donate their used products to ease their conscience. Also, consumers are skeptical to whether the ads describe the quality of the used products correctly, but this is possible to mitigate by having a professional actor perform the maintenance and repair services. It also indicates that easy accessibility is key when providing circular solutions to the consumers, such as repair services. Moreover, the findings show that the recycling strategy is not widespread among the companies, as downcycling is the most common use of recycling today. However, it is argued that it is more likely to develop technologies to achieve upcycling of materials through cooperation between various companies.
Further, the evidence suggests that the various customers might affect the transport service provider differently. This is because some of the customers have a closer relationship with Helthjem than others, which has been established over time or through pilot projects.
Additionally, three of the customers are categorized as PSSCs, and one of the benefits derived from this type of SC is volume growth, which again affects the volume transported.
However, the combination of different customers might be difficult to handle, which makes transparency and detailed communication between all actors in the SC an important priority.
Accordingly, the evidence indicates that cooperation to offer complete and personalized services to the different customers becomes crucial as CE strategies emerge.
The findings also suggest that the challenges can be divided into four main categories:
economic, network, uncertainty and environmental challenges. The economic challenges concern that, as of today, most circular solutions are not yet profitable, and therefore some customers are not willing to invest in such solutions. The network challenges include the question of whether the transport service provider is possessing the right capacities and capabilities to succeed. For instance, customers wish for increased coverage, but this raises the issue of lead times and predictability. The time of delivery is also challenging because it limits the transport company from delivering certain product types and performing all CE strategies, seeing that rent services would be even more efficient if the consumers could deliver and receive the products whenever during the day or night. Similarly, with an infrastructure that only fits small to medium packages, it becomes difficult to transport larger
products that has a huge potential to succeed in the rent strategy, such as tents. The uncertainty challenges include the importance of customer perception, because it is hard to predict exactly how fast the CE trend will grow. The findings further indicate that another uncertainty challenge in the SC is that circular products often are unique and sometimes of high value, which means that the consequences of theft and loss are more severe compared to linear items. Finally, the environmental challenges concern that transport services represent a significant source of GHG emissions, especially in the LML. This becomes an even larger challenge for the transport service provider as their customers are transitioning into a CE, because they most likely want a transport service provider with low emissions.
Besides, the following strategies were found as solutions to the above-mentioned challenges.
First, to face the economic challenges, measures such as increasing the transported volumes and normalizing that consumers need to pay for freight services were suggested. Also, the evidence suggests that cooperation with customers to conduct pilot projects are essential, as it helps the transport service providers in discovering which solutions that are profitable and not. Furthermore, the network challenges may be faced by cooperation with appropriate actors, such as to transport larger shipments and to expand their delivery window. Moreover, the use of technology to improve their shipment tracking is a measure to face the issues regarding lead times and predictability. To face the uncertainty challenges, the findings indicate that continuous communication and relationship building with the customers might result in increased knowledge regarding consumer perceptions and market trends.
Furthermore, the use of insurance and cooperation with other transport service providers to establish delivery lockers are measures to overcome the risk of loss and theft. If a deviation does occur, an increased number of tracking points is beneficial to spot where exactly the error happened, which also improves the quality of the customer service. Finally, the environmental challenges include that transport service providers should invest in more trucks and cars powered by alternative fuel options, as well as continue to utilize deliveries by foot and bikes. On the longer distances, actions to optimize the capacity usage to reduce the number of near-empty vehicles on the road is important to facilitate for the CE.
All in all, CE principles are utilized differently by companies which further bring varying challenges for the transport service providers and their value chain. These challenges vary and are complex, which in the very end means that the transport service providers need to
understand their customers to overcome them. Suitably, the findings indicate that cooperation with other actors and customers is the most dominant strategy to overcome several of the challenges a transport service provider faces in the transition from a linear to a CE. Next, the theoretical and practical implications are explained.