Model 9: Sustainable and Novel Bio-based Products from Food Waste and Biomass for Replacing Plastic

The type was formed on the basis of five enterprises that use food waste, grass and aquatic biomass for developing and producing products for replacing plastic-based straws, cutlery and kitchen ware.

Value proportion

The main value proposition is sustainable biomass-based products that replaces plastic based products. The products included both reusable and for one-time use, incl. edible products. Additional value proposition lies in utilising and reducing food and biomass waste and in the development of circular bioeconomy.

Infrastructure

The upstream key partnerships include the raw material suppliers, e.g., grass, forestry and aquatic biomass harvesters, and the food industry partners that supply the food waste and side streams for processing. As some of the enterprises do not own the production facilities, but outsource the production, food industry partners are not only the source of inputs, but crucial network partners for processing also. The enterprises in this type are developing the novel products, thus cooperation with universities for R&D and mentors for business development were emphasized. As the use of food waste and biomass and the use of plastic products are subject to different regulations, work with different public regulatory authorities is required.

Key activities are manufacturing activities, starting with the purchase of raw material (aquatic, grass, forestry and food waste biomass), processing it or outsourcing the processing (selection, cleaning, and cutting of certain biomass) and production of the end products. The products are novel, thus R&D development activities, incl. invention, product, machine and tool design, verification of process concepts and/or products, prototype development either in-house or in cooperation with external key partners (universities), are important. The enterprises carried out their marketing and sales activities.

The tangible key resources are raw material (reed or straw, aquatic biomass), organic residue, and food waste, the production facilities and technology, and the staff. Intangible key resources include the technical and innovation competence and knowledge.

Keyword ratings for enterprises in Sustainable and Novel Bio-based Products from Waste and Biomass for Replacing Plastic Business Model type
How well does a keyword characterize a business case?

Customer interface

The enterprises established their customer relationships through direct personal sales (personal face-to-face meetings or online through e-mail, social media) as well as through automated online shops.

The main focus was on B2B sales and customer segments included wholesalers and retailers, but also specifically the restaurants, cafeterias and other food establishments for whom the specific products (cutlery, kitchen wares) are intended. B2C direct sales were less important, but there were options for private individuals to buy through online shops.

The channels through which customers are reached are mixed as both direct and enterprise owned channels (direct personal sales, online web shops) were mixed with distribution through partner owned retail and wholesale networks. Exhibitions for reaching out to business customers were separately mentioned as marketing channel.

Business Model Canvas for Sustainable and Novel Bio-based Products from Waste and Biomass for Replacing Plastic Business Model type

Financial viability

The cost structure is that of manufacturing company with main costs such as costs for raw material, production, personnel costs (also for manual work). As the enterprises were developing novel products, R&D costs also occurred.

The revenue stream comes mostly from the sales of products.

Socio-economic aspects and novelty

The activities of the companies are socially recognized and acknowledged for addressing consumer needs and trends (e.g., suitable for vegan), policy objectives such as reduction of single use plastics in daily lives, fair trade practices and social entrepreneurship principles and community involvement. The Business Case of Kaffeeform (Case 9.1: Kaffeeform – coffee cups made from coffee grounds – Germany), a coffee cup producer from Germany, demonstrates integration of a social mission with environmental goals such as recycling food waste, reduction of the use of fossil fuel-based plastics and sustainable processing.

Companies in this type were highly specialised in their activities with some of them outsourcing specific processing activities to partner companies. The policies, particularly the EU level ban on single use plastics, has been major factor for discovering this kind of entrepreneurship opportunities, but in comparison with other types, those SMEs are less dependent on other regulations and policies, although some of companies have opportunities to apply for investment subsidies. The novelty of the companies is high with the focus on material technology and its development. The transferability of Business Model depends on the access to knowledge resources and highly skilled labour that are critical for this type of R&D intensive companies. The other Business Case presented is Spoontainable (Case 9.2: Spoontainable – edible ice cream spoons – Germany), a German company using food waste for edible ice cream spoons, and it demonstrates development of unique product in response to consumer and environmental policy drivers.

Other related Business Models

Archetype of waste recycling includes both Business Models of processing municipal and agricultural waste and residues into bioenergy as well as Business Models based on utilizing the waste for new product offerings. The Business Model innovation lies in finding new value offering from previously discarded waste and establishing new activities, finding new relationships, resources, markets, etc. for it. The model of recycling of waste into bioenergy is easily transferable. Reuse of waste extends the use of already collected bioresources, contributes to better waste management and reduction of environmental impacts, while offering new income streams and reducing costs.

Model 7: Bio-based Fertilizer for Increased Soil Quality

Model 12: Utilization of Municipal Waste and Sewage