Business Models for Material Efficiency Services

Despite the broad recognition of the need for decoupling the material use and the economic development, enterprises are still not using all the opportunities for material efficiency improvements. This chapter proposes material efficiency services as one solution. It also introduces a conceptual framework for analyzing business models of eco-efficient services and applies this framework to material efficiency services. Four business models are outlined and their feasibility is studied from an empirical vantage point, with special emphasis on the financial aspects. Depending on the business model, prominent material efficiency service providers range from large companies with variety of products and/or services to smaller, specialized ones. Typical potential clients for these services are firms that lack the resources to conduct material efficiency improvements themselves. Customers are more likely to use material efficiency services that relate to auxiliary materials or side-streams rather than those that relate to their core business. Potential client organizations with a strategy of outsourcing support activities and with experience of outsourcing are keener to use material efficiency services.