LENTURA A Circular Economy Business Model Case

Abstract

This report analyses one of the business case studies selected within the R2Pi Project: Lentura, an association of agro-ecological food growers located in Galicia, Spain. This study aims at obtaining a comprehensive knowledge of what an initiative based on a local and natural food supply implies in terms of circular business models. Lentura, whose origins date back more than a decade, has as its main goal to provide its customers with horticultural products, obtained through organic practices and marketed in proximity. In other words, the business model is based on growing natural food, free of synthetic chemicals, which is sold through proximity schemes that minimise the number of kilometres covered by the food products. For the latter, distribution is based on direct sales, around a geographical area that does not exceed 30 km between producers and consumers. This association is mainly characterized by organic farming practices. Taking this fact into account and the organic and proximate characteristics of its foodstuffs, Lentura's practices fit in well with a CEBM based on circular sourcing. However, Lentura also carries out activities that may be considered as co-product recovery, such as the utilization of animal excreta for fertilizing or reusing packaging employed in food deliveries. Concerning Lentura’s context, organic farming has been a growing market in Spain and Europe for more than a decade. Although the conventional food sector remains highly competitive, there is a growing demand for a natural and healthy diet, which visibly benefits Lentura’s model. Despite these developments, national and regional legislation does not benefit (or even hinder) the emergence and prosperity of organisations and activities like Lentura. They are characterised by very stringent hygiene requirements and production limitations. The assessment of the circularity of Lentura business model provides remarkable insights. The key aspects are related to the natural farming practices, to the organisation of activities in proximity (reducing the number of kilometres and making it possible for the products to be so natural) and to the take-back and reuse of packaging. These circular activities have given rise to a series of financial and non-financial benefits that range from cost and material savings through the reintegration of packaging, to the improvement of the farmers’ income and the sustainability of food products through the maintenance of proximity schemes. The close and highly relational environment generated by Lentura is the main strength of the organisation, together with the naturalness of its food products. However, the lack of flexibility that they impose on their proximity model leads to relevant problems in aspects such as the volume of supply. With regards to the environment, Lentura may be affected by the increasing competition from organic or eco-friendly products provided by conventional food suppliers. Moreover, this report also shows some potential opportunities for Lentura to go further in circularity and improve its business model, such as relaxing the criteria of proximity, intensifying its production or generating compost from food waste. Even despite the mentioned aspects, this is a circular model that is not difficult to replicate or transfer, since it is based on simple ideas and does not require large investments for its implementation. The critical point to overcome lies in the ability to coordinate a certain know-how together with the maintenance of customers who today have above-average levels of educational awareness on food-related topics. In short, the report shows how Lentura manages to create a small alternative food system with a high relational content, which is an interesting business model for a Circular Economy. Information flows simply and farmers are valued, while respecting to a large extent the natural cycles involved in farming processes. The conclusion section recommends to adapt the hygiene and marketing regulations in the area and to introduce measures to improve consumer’s food education in order to support more circular business models similar to Lentura case.