“Disruptive threats will bring big business incumbents to their knees… A circular economy is going to come whether you like it or not,” Mike Barry, head of sustainable business at Marks and Spencer has said.
Speaking at the annual WRAP conference, Barry described the threats to big business: “The resource crunch is going to drive our input costs up and we are not going to be able to pass those costs on to the consumer in this time of austerity; social media that utterly disrupts the marketplace and gives the means to anybody, no matter how small… [to] compete with us in terms of selling goods and services; and the marketplace that still has significant disquiet over big business.”
He concluded: “Any business that thinks it cannot participate in these new models [of circular economy] – forget it!
“Those disruptive threats will bring big business incumbents to their knees if it cannot deal with those challenges. So the circular economy is going to come whether you like it or not.”
Barry explained that the resource crunch was predicted because of the global three-fold increase in middle-class consumers in the next 20 years – from one to three billion. He said there is going to be a double whammy of inflation as the global economy starts to inflate towards the three billion consumers, and the high prices of resources, despite the recession.
Social media is seen as a major concern. Barry told MRW: “Why should people buy from us when they can buy over eBay a very nice vintage dress for £5?”
Barry also said that “Occupy movements seem to have come, and seem to have gone” without anyone offering a better alternative to the current capitalist system.
“We believe that the angst and disquiet over how big business operates remains. Until somebody can offer something that is more compelling as an alternative to the model that we have today, that remains a big threat to us as well,” he added.
Barry told MRW: “These threats are why we have to get away from ‘new stuff’ and into ‘shared value’.”
To do this, M&S has been initiating various programmes that create a relationship with their customers, such as the ‘Shwopping’ initiative.
Barry revealed that ‘Shwopped’ garments have now come full circle as coats on M&S shop floors. He said the recycled woollen coats sell for £89 instead of £150 that would be the equivalent in new wool.
He highlighted a hanger recycling scheme run in conjunction with UNICEF, which he said had delivered 147m hangers back to M&S shops to be re-used.
He also said that 89% of M&S food waste is now sent to AD plants, and the resulting energy is used in M&S stores. M&S has also achieved zero waste to landfill in its stores, shops and offices.
Barry said there is a strong business case for such initiatives. Plan A has saved M&S £105m net last year. These are valuable savings in what has been a tough year for M&S. Their trading figures out today show better results in Q2 than Q1, but times are still challenging.
In the future, M&S wants to achieve zero waste to landfill for its construction and refits, said Barry, as well as suppliers and factories – the entire supply chain over time.