The Circular Economy is on the top of the corporate agenda and provokes the interest of the academic community, governments, and policymakers. The Circular Economy paradigm is seen as a better solution and more sustainable alternative to the current linear system. To realize the benefit of the CE, new thinking and new business models are required. So far, there is limited progress has been achieved regarding the implementation of the Circular Economy. Therefore, scholars strive to understand the phenomena, providing conceptualizations, new strategies, and new business models, lacking empirical testing. The purpose- this study is mainly conducted to test empirically a set of influencing factors that include drivers which stimulate SMEs to implement Circular Business Models and the barriers that prevent or complicate the implementation process. Methodology- in order to fulfill the research objective, qualitative research with a multiple-case study approach is employed, focusing on three Swedish SMEs that operate in three different sectors. Findings- the outcome empirically confirmed that organizational drivers related to leadership and organizational culture, resource availability including technology and knowledge, financial factors, product and process development, society, environment, and stakeholder pressure, geographical proximity, entrepreneurship, and bran strengthening are seen as driving and facilitating factors to implement Circular business model. While, the lack of supportive regulation and policies, consumer behaviors related to single-use culture, the nature of the product and material, and the presence of incompatibility and monopoly in the supply chain are observed as major barriers.

Tourism is an industry that makes important contributions to the Sri Lanakan economy. Thelong-term survival of this industry depends on the longevity of natural resources and thebeauty of the environment. Today, the tourism industry is impacting the naturalenvironment negatively. The concept of circular economy is gaining global attention assustainable alternative to traditional economic practice. Through qualitative approach, thisthesis investigates how the Sri Lanka tourism industry can adopt a circular business modelto mitigate its negative impacts. The methodology utilized semi-structured interviews withfive business personalities involved in hotel and accommodation sectors listed undercategory of small and medium-sized business.  The study first examined the awareness and perceptions of the circular business modelconcept among tourism SMEs in Sri Lanka. This is a step was extremely important, asawareness is a fundamental prerequisite for adopting more sustainable practices. Theresearch investigated the current level of understanding and knowledge about circularbusiness model concepts within these small and medium-sized enterprises. This exploredhow tourism businesses in Sri Lanka currently view the circular model whether they see itas a practical, beneficial approach or faced concerns and lack knowledge.  Next, under Opportunities and Challenges the study explored the key opportunities andchallenges that either enable or challenge the transition towards circular business models.On the opportunity side, the research examined factors that could facilitate and incentivesSMEs to achieve circularity, such as cost savings, improved brand reputation, attractingenvironmentally conscious tourists, and preserving local value chains and resources. Thefindings also highlighted that some SMEs are already employing innovative circularpractices, indicating a readiness to embrace more sustainable operations. Conversely, theresearch could identify several barriers to the widespread adoption of circular practicesamong SMEs. These barriers include limited awareness of circular economy principles,financial constraints, and regulatory challenges.  Finally, the study evaluated on developing practices the effectiveness of any existingbusiness development goals or initiatives related to circular economy strategies within SriLankan tourism SMEs. This involved assessing the current state of circular practices,identifying areas for improvement, and determining the specific types of support andresources needed to help these enterprises successfully adopt and sustain a circular businessmodel.  The thesis suggests several avenues for future research, including road map to achieve fullysustainable circular business model. It also recommends evaluating the effectiveness ofgovernment policies and initiatives in promoting the adoption of circular economyprinciples within the tourism sector and investigating the role of technology and innovationin facilitating the transition to circular business model. Key words – Circular Business Model, Tourism SMEs Sri Lanaka, Sustainability,Resources optimization

Circular economy (CE) is seen as a strategy to achieve sustainable development, requiring commitment and support from multiple actors on all system levels; from companies and products to governments and nations. Circular business models (CBMs) are regarded as an important leverage to implement circularity at an organizational level, and business support is considered an important enabler of these. Communication between practitioners and policy-makers, as well as understanding the barriers of CE in the local context, can facilitate the development of efficient business support. This thesis has from a company perspective explored barriers to circular business model innovation (CBMI) and the impact of firm-specific business support activities on this innovation process. This was done through a multiple-case study of ten Swedish SMEs who had received direct business support for circularity, and thus had initiated a circular project. The study has identified seventeen different barriers across five categories, spanning over the entire innovation process from idea to full implementation. Overall, economic viability appears to be an important factor which relates to and depends on several other barriers, and the novelty of CE contributes to the occurrence of many identified challenges. While some barriers are more common across all ten cases, often challenges related to market demand, financing and knowledge, others are more specific for each case and circular strategy. Furthermore, this study has found that coaching, training, and funding are firm-specific activities that can help SMEs overcome mainly internal barriers in the early stages of the CBMI process, addressing several of the most common barriers identified in this study. This research has also included a company perspective on the costs and benefits of the activities, and pointed at important factors to consider in the development of future business support. / Cirkulär ekonomi ses som en strategi för att uppnå hållbar utveckling, och kräver engagemang och stöd från flertalet aktörer på samtliga systemnivåer; från företag och produkter till regeringar och nationer. Cirkulära affärsmodeller betraktas som en viktig hävstång för att implementera cirkularitet på en organisatorisk nivå, och företagsstöd anses vara en viktig möjliggörare av dessa. Kommunikation mellan utövare och beslutsfattare, samt förståelse för barriärer till cirkulär ekonomi i det lokala sammanhanget, kan underlätta utvecklandet av effektiva företagsstöd. Denna uppsats har ur ett företagsperspektiv utforskat barriärer till cirkulär affärsmodellsinnovation och den inverkan som företagsstöd har på denna innovationsprocess. Detta utfördes genom en fallstudie av tio svenska små och medelstora företag som mottagit stöd för cirkularitet, och som således initierat ett cirkulärt projekt. Studien har identifierat sjutton barriärer inom fem kategorier, vilka sträcker sig över hela innovationsprocessen från idé till full implementation. Generellt framträder ekonomisk livskraft som en viktig faktor, relaterad till samt beroende av flertalet andra barriärer, och nymodigheten i cirkulär ekonomi bidrar till förekommande av flera identifierade barriärer. Medan vissa barriärer är mer vanligt förekommande bland de tio fallen, ofta utmaningar relaterade till marknadens efterfrågan, finansiering och kunskap, är andra mer specifika för varje fall och cirkulär strategi. Vidare finner denna studie att rådgivning, träning och finansiering är företagsspecifika aktiviteter som kan hjälpa små och medelstora företag att överkomma huvudsakligen interna barriärer i de tidiga faserna av cirkulär affärsmodellsinnovation, och som bemöter flertalet av de vanligaste barriärerna som har identifierats i denna studie. Denna studie har även inkluderat ett företagsperspektiv på aktiviteternas nytta och kostnader, samt belyst viktiga faktorer att ta hänsyn till i utvecklingen av framtida företagsstöd.

Moving towards a more circular economic model is necessary in order to secure the sufficiency of vital raw materials and to achieve a balance between both economic and environmental prosperity. However, the discussion regarding circular economy from a business perspective is still rather limited, and the practical applications of circular economy are mostly related to waste management and industrial applications. Needless to say, circular economy is much more than just large-scale recycling. Circular economy, as a system which aims to ensure a more circular flow of resources, materials and energy, can embody a variety of expressions from closing resource loops to redesigning products, services and the nature of ownership towards favoring renting, sharing, reusing and other alternative ways of maximize the resource efficiency and extend product life. Hence, the principles of circularity can be applied across all industries, instead of just those operating in the industrial sector. Standing on the way of the development of a global circular economy is the perceived mismatched objectives of profit seeking businesses and sustainability advocators. Businesses want high sales levels and profit margins, whereas at the core of environmental sustainability is often to promote conscious consumption and cut down on activities resulting in pollution and waste. And because circular economy is often strongly associated with sustainability matters, businesses tend to stray away from it as it is considered to work against a company’s purpose of making profit. Yet here is the catch – instead of seeing circular economy just as a sustainability tool, it can also be considered as a viable business opportunity which when effectively exploited, can be a source of competitive advantage and a source of economic value

As customers become more and more aware of the threats and limits of the current economic system, joined with the pressure of environmental policies, companies are pressured to rethink their offerings, processes, and business models in order to accelerate the transition to a circular economy. This transition requires significant changes in habits and behaviors, but simultaneously it offers opportunities for innovation. In this regard, business model innovation plays an essential role in enabling this transition via circular business models that close the loop. For the successful development, implementation, and adoption of new business models, a depth understanding of customers' needs is fundamental. However, little is known about the customer perceptions, motivations, and willingness to participate in circular economy. To address this gap, the study explores the transition to circular economy from the customers' perspective by employing a qualitative single case study bounded to the furniture retail company, IKEA, specifically the IKEA Second-Hand pilot store in Eskilstuna, Sweden. Through in-person interviews, observations, and a questionnaire, data from customers donating their used furniture to the recycling mall ReTuna, people discarding furniture at the recycling station, and people selling and giving away their used furniture via the social media platform Facebook, was captured to explore the customer experience in the after-use phase of furniture. Findings of the study present opportunities for the case company to strengthen its product recovery strategies.

Bakgrund: Cirkulär Ekonomi är ett begrepp som växt sig starkare under senare år i takt med att hållbara frågor fått en större roll i samhället. Till följd av detta har olika affärsmodeller som främjar CE blivit allt vanligare, och däribland återfinns funktionsförsäljning. Det finns en stor mängd forskning kring hur en implementering av funktionsförsäljning påverkar olika delar i en affärsmodell och vad som bör has i åtanke för att det ska bli ett lyckat skifte. Något som inte diskuteras lika mycket är de finansiella implikationerna som medförs vid övergången till funktionsförsäljning, och vad de får för betydelse ur ett finansiellt perspektiv och företags kassaflöde. Syfte: Syftet med studien är att undersöka hur olika delar i affärsmodellen förändras vid ett skifte till funktionsförsäljning samt vilka finansiella implikationer det får, med särskilt fokus på kassaflödesförändringar. Vidare avser studien att studera vilken betydelse förändringarna i kassaflöden får med avseende på lönsamhet och risk. Metod: Studien är en kvalitativ fallstudie som har utförts med en abduktiv ansats och pragmatism som vetenskaplig utgångspunkt. Det empiriska materialet har dels samlats in genom semistrukturerade intervjuer och dels genom dokumentstudier. I val av fallföretag användes två urvalsmetoder, bekvämlighetsurval samt målstyrt urval. Slutsats: Studiens resultat visar på att flera förändringar sker i kassaflödet vid ett skifte till funktionsförsäljning, både i form av att befintliga kassaflöden förändras och att nya kassaflöden tillkommer. Förändringarna som sker berör både stora utbetalningar på grund av ett större ansvar och åtagande mot kund, samt betydande inbetalningar till följd av nya inkomstmöjligheter. Vidare har det framgått att förändringarna medför ett väsentligt större risktagande till följd av att ägarskapet stannar kvar hos säljaren, men att det även finns god potential till att uppnå en högre lönsamhet än vid en traditionell affärsmodell. / Background: Circular Economy is a concept that has grown in recent years as sustainability issues have been given a greater role in society. As a result, various business models that encourage CE have become increasingly common, including functional sales. There is a large amount of research regarding how the implementation of functional sales affects different parts of a business model and what should be considered to make the shift successful. Something that has not been discussed as much is the financial implications that come with a transition to functional sales, and what significance they have from a financial perspective and for the cash flows of companies. Research aim: The aim of this study is to investigate how different parts of the business model change in a shift to functional sales and what financial implications it causes, with a special focus on the cash flow changes. Furthermore, the study intends to study the significance of the changes in cash flows with regards to profitability and risk. Method: The study is a qualitative case study that has been carried out with an abductive approach and pragmatism as a research paradigm. The empirical material has been collected partly through semi-structured interviews and partly through document studies. In the selection of case company, two sampling methods were used, convenient sampling and targeted sampling. Findings: The result of the study implies several changes that occur in the cash flow at a transition to functional sales, both in the case of already existing cash flows, but also that new are added. Changes that occur partly affect the payments of the company due to a greater responsibility and commitment towards customers, and also partly the received payments due to new income-opportunities. Furthermore, the study indicates that the changes lead to a significantly greater risk as a result of the ownership remaining with the seller, but it also indicates that there is good potential for achieving higher profitability compared to the traditional business model.

Production automation as a service (PAaaS) is seen as a new trend that enables the possibility to use production automation technologies as a service. The technologies are cloud-based which makes the implementation of production automation more effective and cost-effective. This approach is attractive to the companies that have a limited capital investment. The purpose of this thesis was to analyse and understand the implementation of Production Automation as a Service (PAaaS) in the manufacturing industry. In order to understand its implementation, it is important to know what the drivers and benefits with PAaaS implementation and what challenges there are and how to overcome them for a successful implementation. To provide with a comprehensive answer and conclusion about PAaaS implementation in the manufacturing industry the following research questions was studied:1. What are the drivers and benefits of PAaaS implementation in the manufacturing industry, and what needs does it fulfil?2. What are the challenges of implementing PAaaS in the manufacturing industry, and how can they be overcome for a successful implementation and scale-up?To be able to answer these questions, a qualitative research study based on literature review and interviews was conducted. The combination between the literature and the real-life experience in PAaaS implementation provided a greater understanding of the concept. The aim of the research questions is to provide guidance and recommendation for companies seeking for a successful implementation of PAaaS which leads to improved operational efficiency and the ability to utilise the technological advancement provided through PAaaS. The approach applied in this study has been qualitative research with an abductive research approach. By obtaining data through scientific articles and interviews it was possible to analyse it more in-depth in order to find similarities between them.In conclusion, PAaaS implementation in the manufacturing industry provides with key benefits such as cost-effectiveness, improved flexibility, scalability, productivity, efficiency, and improved product quality. These benefits fulfil several needs of manufacturing companies such as being more flexible and being able to use automated solutions at a lower cost. These needs also act as the drivers for the implementation of PAaaS. The drivers are an important aspect of PAaaS implementation, because without any drive and motivation, there won’t be any implementation of PAaaS that can fulfil a certain need of the company. The drivers and motivation for a PAaaS implementation in the manufacturing industry is the possibility for a business model transformation and the technological advancements that the manufacturer gain with the implementation.In addition, there are key challenges that makes the PAaaS implementation more complex for the manufacturing companies. These challenges are, Integration with legacy systems, internet dependency and lack of expertise and knowledge. To able to achieve a successful implementation, it is important to address the challenges, by addressing these problems it was possible to provide with strategies on how to overcome them. Which lays the foundation for future research about this topic.

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Bakgrund: Världsekonomin har länge präglats av en linjär ekonomi, ett system som inte är hållbart och ett hot mot en framtida stabil ekonomi. Cirkulär ekonomi har lyfts fram som ett mer hållbart alternativ. Företagen är de som behöver vara drivande för att en omställning från linjär ekonomi till cirkulär ekonomi ska vara möjlig och en del företag har redan idag påbörjat detta arbete genom att implementera en cirkulär affärsmodell i sin verksamhet. En del tidigare forskning visar på ekonomiska fördelar för företag som arbetar med cirkulära affärsmodeller, en del visar på ekonomiska nackdelar. Denna studie vill bidra både teoretiskt och praktiskt genom att studera företags drivkrafter till att styra till en cirkulär affärsmodell och därmed undersöka om det finns andra drivkrafter än ekonomisk lönsamhet.  Syfte: Syftet med studien är att undersöka vilka drivkrafter som motiverat företag till att börja arbeta med cirkulär ekonomi. Genom att studera företagens syn på intäkter och kostnader i samband med att ställa om till en cirkulär ekonomi ämnar studien bidra med bättre förståelse för vilken påverkan ekonomisk lönsamhet har på företags beslut om hur verksamheten ska styras. Syftet är även att undersöka om det finns andra drivkrafter än ekonomisk lönsamhet som påverkar motivationen till att styra till en cirkulär affärsmodell. Då studien ämnar bidra med förståelse för vilka drivkrafter företag har haft till att börja arbeta på detta sätt bör studien vara av intresse för de beslutsfattare som verkar för att företag ska styra sin verksamhet till en cirkulär ekonomi. Metod: För att svara på studiens frågeställning och uppfylla syftet har kvalitativ metod använts i form av semistrukturerade intervjuer med företag som påbörjat sitt arbete med en cirkulär affärsmodell. De teorier som används i studien för att analysera den empiri som samlas in är aktieägarteorin, intressentteorin och självbestämmandeteorin. Resultat och slutsats: Resultatet från de företag som deltagit i studien visar att möjlighet till positiv påverkan på intäkter och kostnader på kort sikt inte haft särskilt stor inverkan på beslutet att styra till en cirkulär affärsmodell. En del arbetar med cirkulär ekonomi trots att de i dagsläget ser negativ ekonomisk påverkan av det, att kortsiktigt öka vinsten tycks inte varit vad som motiverat till att styra mot en cirkulär affärsmodell. Det som snarare tycks motivera företagen är att en cirkulär affärsmodell hjälper dem leva upp till svensk lagstiftning och ökade miljökrav, samt att det finns en vilja att minska sin klimatpåverkan. Förutom detta framkommer det att kundernas och marknadens efterfrågan på miljövänliga alternativ är något som i stor utsträckning motiverat företagen att arbeta för en cirkulär ekonomi. Resultatet går till viss del i linje med tidigare forskning. Det som skiljer sig är att lagar och miljökrav samt miljöintresse är mer framträdande än tidigare forskning visat. Det vore därför intressant att i vidare studier undersöka drivkrafter till cirkulära affärsmodeller utifrån institutionell teori. Det vore även intressant att studera skillnader vid en jämförelse mellan små, medelstora och stora företag eller börsnoterade och onoterade företag. / Background: For a long time, the world economy has been built on a linear economy, a system that is not sustainable and a threat to a sustainable future economy. A circular economy has been raised as a more sustainable alternative. It has been brought forward that the firms will have to lead the work towards a circular economy for the transition from a linear economy to a circular economy to be possible, and some firms have already started this work by implementing a circular business model. Some previous studies have shown that a circular business model generates economic benefits, some have shown economic disadvantages. This study aims to give theoretical and practical contributions by studying the drivers that has determined companies to implement a circular business model, and thereby examine if there are other drivers than economic profitability. Purpose: The aim of the study is to explore which drivers have motivated firms to start working towards a circular economy. By studying the firm’s view on revenues and costs in conjunction with their work for a circular economy the study aims to contribute with knowledge regarding to which extent economic profitability has an impact on the decision to change the business model. An additional aim with the study is to explore if there are other drivers that has had an impact on the motivation to direct the business towards a circular business model. Since the study aims to contribute with understanding regarding which drivers that have motivated firms to work this way, the study should be of interest for decision makers who want firms to start working towards a circular economy. Method: To answer the research question, and to achieve the purpose of the study, a qualitative method has been used by conducting semi-structured interviews with firms which are working with a circular business model. The theories that have been used to analyse the empirical data are the shareholder theory, the stakeholder theory and the self-determination theory. Result and conclusion: The result shows that the opportunity to have a positive impact on revenues and costs in the short term has not had an impact on the decision to direct the business towards a circular business model for most of the companies that have been a part of this study. Some of them work toward a circular economy even though it currently has a negative impact on their profit. Economic profitability in the short term does not seem to have been what has motivated them into directing the business towards a circular business model. It seems that they would rather have been motivated to work with a circular business model because they need to follow environmental regulations and live up to certain environmental requirements in procurement, together with a will to lower their impact on the environment. Besides this it appears that the demand for environmentally friendly products from the company's customers and the market in general is something that has motivated the companies to work towards a circular economy. The results comply with earlier studies to some extent. Differences are that drivers in terms of laws and environmental requirement in procurement are mentioned more in this study than in earlier studies. For further studies it would therefore be interesting to study drivers for a circular economy using institutional theory. It would also be interesting to study differences between drivers for small, medium and large companies, or differences between listed and unlisted firms.

The business environment is constantly being challenged with growing complexity and rapid changes, usually unforeseeable, as it could be observed during the last decades. One topic growing intensively in importance is environmentally sustainable business practices, which are often driven by societal expectations and new regulations; and which, under the enormous pressure of external stakeholders, cannot be avoided by companies anymore. Circular Economy, a relatively new concept, is becoming more popular, offering businesses not only a competitive advantage, but also the possibility to operate profitably, while still contributing to a sustainable development. This thesis provides insights on how MNCs with linear business models can take advantage of dynamic capabilities in order to incorporate circular business strategies. Current literature lacks research about the connection of how dynamic capabilities can support companies with the implementation of Circular Economy principles. Startups often implement sustainable strategies from inception, but: how can traditional MNCs of complex character successfully innovate their business models and strategies, without major disruption and losing their profitability? We argue that not only these young and born circular companies will lead the markets in the future, but also existing MNCs can successfully develop and stay competitive. This study wants also to highlight what resources and capabilities both types of companies state as key for successful circular business strategies, and how they are handled and embedded in the organizational structure by managers. A qualitative case study approach provided the detailed necessary information (from different industries and degree of circularity) to address the question. The findings widen the research of business model innovation towards circular business strategies and show a clear picture of which dynamic capabilities are of importance and how they can be successfully incorporated. We conclude by indicating that the concepts of learning, knowledge, relationships, leadership and management style were perceived as the most decisive within the organizations; with remaining external barriers as challenging.