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Is Cyclic Economy a new term in Business where business is done at the cost of a loyal customer and generates unlimited revenue for business owners.
Picture Courtesy: Profit loss

After Circular Economy, Cyclic Economy a new word in Business!

Introduction

As global economies confront rising environmental degradation, resource depletion, and waste accumulation, new economic models are being proposed to create sustainable pathways. Among these, Circular Economy has gained significant traction as a regenerative alternative to the traditional "take-make-dispose" linear model.

However, a lesser-known but increasingly discussed concept is the Cyclic Economy—often mistaken for its circular counterpart. While both models use the concept of "cycles" and "reuse", they differ fundamentally in intent, structure, and environmental impact. In fact, as per the Arun Kumar TG Model, the cyclic economy may be detrimental to long-term sustainability, as it promotes a disguised form of overconsumption.

Difference Checker

What is Cyclic Economy?

The cyclic economy is an economic system where products and consumption follow repetitive, artificially driven cycles, often without truly reducing environmental impact. The cycle generally involves:

  1. Production
  2. Consumption
  3. Disposal
  4. Reproduction (with slight changes)
  5. Re-consumption

This loop is driven by market forces, often under the guise of sustainability—such as recycling or green upgrades—but in reality, it reinforces consumerism, shortens product lifecycles, and perpetuates resource extraction.

Arun Kumar TG's Critique:

According to Arun Kumar TG, the cyclic economy:

  • Promotes planned obsolescence
  • Masks overconsumption with green labels
  • Perpetuates environmental harm while pretending to be regenerative
  • Creates an illusion of sustainability without addressing root causes like overproduction, resource inequality, or corporate accountability

Example:

  • A smartphone brand releases new models yearly, encouraging consumers to "upgrade" while discontinuing older models. The packaging may be "eco-friendly", but the core model relies on repeat buying, hidden extraction, and e-waste.

What is Circular Economy?

The circular economy is a regenerative economic system that aims to design out waste and pollution, keep products and materials in use, and regenerate natural systems. It emphasizes:

  • Durability
  • Repairability
  • Reusability
  • Recyclability
  • Product-as-a-Service models

In circular economies, waste becomes a resource. Products are designed to stay in circulation longer or be fully recovered at the end of their life.

Example:

  • A company offers modular phones with easily replaceable parts. The same device can last 10+ years with updates and part swaps. The company retains ownership of materials and remanufactures them.

Key Differences Between Cyclic and Circular Economy

 
Feature Cyclic Economy Circular Economy
Primary Intent Repeat consumption loops Eliminate waste and regenerate resources
Design Philosophy Planned obsolescence, trend-driven upgrades Design for longevity, repair, and reuse
Waste Management Accepts recurring waste with limited recycling Eliminates waste at the design and system level
Sustainability Claims Often greenwashed or cosmetic Substantive environmental and systemic benefits
Examples Fashion trends, tech upgrades, green packaging Circular packaging, product-as-a-service, leasing
End-of-Life Product Use Disposal + repurchase Repair, reuse, remanufacture, or biological return

The 4-Step Process of the Cyclic Economy


Step 1: Planned Obsolescence in Design

  • What Happens: Products are designed with a limited lifespan—either physically (fragile components) or digitally (software discontinuation).
  • Example: Smartphones where battery replacement is difficult or software updates are stopped after 2–3 years.
  • Purpose: Ensures consumers return to buy new models frequently, keeping demand artificially high.

Step 2: Frequent Minor Upgrades and Rebranding

  • What Happens: Small cosmetic or functional changes are marketed as “revolutionary” updates.
  • Example: Annual model changes in automobiles, fashion collections, or tech gadgets with minimal improvement.
  • Purpose: Triggers desire to replace working products, feeding the repeat-consumption loop.

Step 3: Greenwashing Through Reuse/Recycling Claims

  • What Happens: Companies claim environmental responsibility by promoting partial recycling or “eco-friendly” packaging, without changing the underlying business model.
  • Example: "Recycled" clothing lines made from plastic bottles, yet produced at massive scale, still generating huge waste.
  • Purpose: Builds a sustainability narrative that masks ongoing exploitation of resources and encourages guilt-free consumption.

Step 4: Re-introduction of New Products into the Market

  • What Happens: The cycle restarts as companies launch the next-generation product, often incompatible with the previous version’s parts or accessories.
  • Example: Proprietary phone chargers and accessories that change with each model, creating new waste.
  • Purpose: Forces consumers to buy not just the core product but all related accessories again, locking them into another purchase cycle.

Summary Chart

Step Action Purpose Example
1 Planned Obsolescence Shortens product lifespan Smartphones, printers
2 Minor Upgrades Stimulates new demand Annual phone/car models
3 Greenwashed Recycling Masks true impact Fast fashion’s “recycled” collections
4 Market Re-entry Restart consumer cycle New version launch with incompatible parts

Why It’s Harmful (As per Arun Kumar TG Model):

  • Creates a false sense of sustainability
  • Increases resource extraction and waste
  • Promotes endless consumerism
  • Undermines true circular design thinking

Conclusion

To build a genuinely sustainable economy, businesses must break this cycle by:
  • Designing for longevity and repairability
  • Offering service-based models (e.g., leasing, product-as-a-service)
  • Ensuring true product take-back and material regeneration
  • Eliminating dependence on trend-based consumption
This shift—from circular to cyclic —is not just environmental, but not economical and unethical.
 

Author: Profitloss
Source: Profit loss
Posted On: Saturday, 25 October, 2025

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