A new kind of relationship: Supplier and public procurer response to a circular economy Insights from Philips Lighting's deal with Washington Metropolitan Area Transit Authority

Abstract

Realizing the potential of a circular economy requires uptake of new business models, such as product service systems. Putting product service systems in the perspective of a circular economy has the potential to increase business resilience while uncovering commercial opportunities throughout the product’s life cycle. Thus, a proper understanding of product life cycle phases is essential. As every business model has its economic, environmental and social impacts, it is important to take a step towards the methodology of sustainability measurement. On this wise, understanding how to prove life cycle value across people, planet, and prosperity (PPP) is vital.

Over the course of this research the empirical focus is set on Philips’s Light as a Service (LaaS) deal with Washington Metropolitan Area Transit Authority. To this extent research includes following elements: the description of a relationship change caused by a applying the concept of a circular economy ; the analysis of product service system opportunities; and the comparison of service and product based business models based on a sustainability assessment.