How to Implement Circular Economy with Product Identity
Key Takeaways
- The EU's Ecodesign for Sustainable Products Regulation (ESPR) mandates circular economy compliance — including Digital Product Passports — across major product categories by 2027.
- Serialised product identity is the foundational infrastructure for repair access, ownership transfer, end-of-life material recovery, and DPP readiness.
- Well-implemented repair programmes have been shown to reduce warranty claim volumes by 15–25% over three to five years.
- Manufacturers who build circular infrastructure now avoid the remediation costs that will concentrate when regulatory deadlines hit.
Most manufacturers hear "circular economy" and think recycling. A well-placed collection bin at a retailer, a take-back scheme buried in the warranty small print, a footnote in the sustainability report. That interpretation misses the point by a wide margin — and it misses the opportunity by even more.
The circular economy isn't a recycling programme. It's a fundamentally different relationship between a product and its lifecycle: one built on longevity, repairability, reuse, and intelligent material recovery. For manufacturers of durable goods, that shift has significant implications for how products are designed, sold, supported, and eventually recovered. And it is increasingly mandatory — the EU's Ecodesign for Sustainable Products Regulation (ESPR) is introducing binding circular economy requirements across product categories through 2027 and beyond.
The good news: the infrastructure manufacturers need to comply already exists. It's called product identity.
Circular Economy Means More Than End-of-Life
What does circular economy compliance actually require from a manufacturer — beyond recycling? The scope spans four distinct obligations. Longevity means designing products that last and producing evidence they do; regulators want durability data, and consumers increasingly reward it. Repairability means providing spare parts, documentation, and diagnostic tools to independent repairers and end users — the EU Right to Repair Directive (2024/1799) makes this enforceable, not discretionary. Reuse and resale means products must be transferable between owners with their history intact; a second-hand buyer who cannot access the original manual or warranty status has no confidence in the product, and neither does their repairer. Material recovery means knowing the exact composition of a unit at end-of-life so materials can be sorted and returned to the supply chain. Every obligation requires the same foundational capability: knowing which specific unit is which — not the model or batch, but the individual serialised unit tracked from manufacture to end-of-life.
Four Circular Capabilities That Product Identity Unlocks
Which operational capabilities does serialised product identity unlock for circular economy compliance? Product identity creates the operational backbone for circular economy at scale, enabling four capabilities that each address a distinct regulatory and commercial requirement. Repair access allows any technician to retrieve the correct manual, parts list, and diagnostic guide by scanning a unit — meeting the Right to Repair obligation without manual coordination. Ownership transfer allows a second-hand buyer to re-register a product and inherit its full service history in seconds, enabling certified pre-owned programmes. End-of-life data ensures that material composition, hazardous substance declarations, and disassembly instructions remain accessible to recyclers years after sale — a mandatory ESPR requirement. Usage data for durability design aggregates scan and service signals to identify failure patterns and inform the next product generation. The table below maps each capability to the data required and the business impact delivered.
| Circular Capability | What It Enables | Data Required | Business Impact |
|---|---|---|---|
| Repair access | Any repairer — authorised or independent — can pull the right manual, parts list, and diagnostic guide by scanning the product | Model, serial number, firmware version, repair documentation links | Fewer misdirected repairs, faster resolution, Right to Repair compliance |
| Ownership transfer | Second-hand buyers receive full product history and can re-register ownership in seconds | Registration history, warranty status, service records | Unlocks certified pre-owned programmes, extends brand relationship beyond first owner |
| End-of-life data | Recyclers and material processors know exact material composition, hazardous substance content, and disassembly instructions | Bill of materials, substance declarations, disassembly guides | Regulatory compliance (ESPR, Battery Regulation), material recovery value |
| Usage data for durability design | Aggregated scan and service data feeds back into product development to identify failure patterns and improve future designs | Scan frequency, support topic frequency, repair reason codes | Reduced warranty costs, longer-lasting products, ESG reporting evidence |
Repair Access: Right to Repair Is Not Optional
The EU Right to Repair Directive (2024/1799) requires manufacturers to make spare parts, repair manuals, and diagnostic tools available to independent repairers. The obligation is real and enforceable. The challenge is delivery: how do you get the right repair information to the right technician, on-site, for the right product unit?
A serialised identity — accessed via a product scan — solves this cleanly. When a technician scans the product, the system returns the exact documentation for that unit: the firmware version it shipped with, the parts supersession history, the known failure modes for that batch. No guesswork, no generic manual that may not match the production variant in front of them.
Ownership Transfer: The Second Life Problem
The resale market for durable goods is growing rapidly. Platforms like Back Market, eBay Refurbished, and specialist trade-in schemes are seeing record volumes. But the product data doesn't travel with the product. The second owner gets a device with no history, no warranty context, and no onboarding — which degrades their experience and reflects poorly on the original manufacturer.
Product identity fixes this. When the first owner sells or donates the product, they can initiate a transfer: the old registration is closed, the new owner scans the product and re-registers in their name, and the full history (service records, manuals, parts ordered) transfers with it. The manufacturer now has a relationship with the second owner — and a second chance to sell accessories, extended warranties, and support plans.
For more on how this works in practice, see our article on managing second-hand products with digital identity.
End-of-Life Data: You Can't Recover What You Can't Identify
ESPR's Digital Product Passport requirements include mandatory material composition data, substance of concern declarations, and disassembly instructions. This data has to be accessible at end-of-life — meaning a recycler processing a unit five years after sale must be able to retrieve it.
That is only possible if the product carries a durable, readable identity and the data behind it is maintained in a live system. A sticker that has worn off, or a PDF that has been deleted from a retired microsite, doesn't meet the requirement.
Usage Data for Durability Design
This is the circular capability that most manufacturers overlook — and the one with the longest-term payoff. When every product in the field is connected to a live identity, you accumulate structured data about how products actually behave: which models generate the most repair requests, which components fail first, which support topics spike after a firmware update.
That data feeds directly into product development. A manufacturer that can demonstrate — with evidence — that their products last longer than the category average has a genuine sustainability story to tell. It also reduces warranty costs, which is measurable on a balance sheet.
Step-by-Step Implementation: From Zero to Circular
How should a manufacturer sequence circular economy implementation using product identity? The capabilities are interdependent and build on each other, so sequencing matters. Serialised identity must come first — it is the non-negotiable foundation that all other capabilities depend on. Repair data is the second layer: once units have identity, structured documentation can be attached and kept current, meeting the Right to Repair obligation operationally rather than just in policy. Ownership transfer is the third step: with identity and repair data in place, a transfer workflow becomes a straightforward feature addition that unlocks resale and certified pre-owned programmes. End-of-life tracking is the final step that closes the loop, publishing material and substance data to product records so recyclers can retrieve it years after sale. This sequence means manufacturers do not need to implement everything at once. Each stage delivers independent value — compliance coverage, commercial capability, and cost reduction — while contributing to the complete circular infrastructure that ESPR will require across most product categories by 2027.
Step 1: Serialised Identity — The Non-Negotiable Foundation
Before anything else works, every product unit needs a unique identifier — a serial number or SGTIN — linked to a persistent digital record. This is the foundation that all other circular capabilities sit on.
In practice, this means assigning a unique GS1 Digital Link QR code to every unit at manufacture, and ensuring that code resolves to a live endpoint that returns structured data. The code must be durable — embedded in the product itself, not just on packaging that gets discarded.
At this stage, even basic serialisation pays dividends: you can track which units are in the field, associate scan events with locations and time, and begin building the product history that later capabilities will draw on.
Step 2: Add Repair Information
Once units have identity, layer in repair access. This means attaching structured repair documentation to each product record: user manuals, spare parts lists with current availability, diagnostic guides, and — where applicable — disassembly instructions for authorised and independent repairers.
The key is keeping this information current. Parts supersede, manuals are updated, known issues are identified. A product identity system with version-controlled content ensures that any scan — whether by a consumer or a technician — always returns current, accurate information. This is how you meet the Right to Repair obligation operationally, not just in policy.
For a deeper look at the business case here, see why Right to Repair is a competitive advantage for manufacturers.
Step 3: Enable Ownership Transfer
With identity and repair data in place, ownership transfer becomes a straightforward feature addition. The mechanism is simple: when a product is sold or given away, the current owner triggers a transfer (or the new owner scans the product and the system detects it is already registered and offers a transfer workflow). The history is preserved; the registration updates.
This step requires a decision about what "ownership" means in your system — and what data the new owner inherits. Warranty coverage may not transfer (depending on your terms and jurisdiction), but service history, manuals, and parts access should. Getting this logic right upfront makes certified pre-owned programmes straightforward to launch later.
Step 4: Track End-of-Life
The final step — and the one that closes the loop — is end-of-life data. This means ensuring your product records include the material and substance data that recyclers need, and that this data remains accessible for the full expected product life plus any statutory retention period.
In practice, this means integrating your product identity system with your bill of materials data, and publishing the relevant subset (material composition, hazardous substance declarations, disassembly instructions) to the product's digital record. At end-of-life, a recycler scans the product and retrieves exactly what they need to process it correctly.
This is not optional under ESPR. It is mandatory DPP content for most product categories by 2027. For a full checklist of what your DPP must contain, see our DPP readiness checklist for 2026.
The DPP Connection: Circular Data Is Mandatory
What is the relationship between the EU Digital Product Passport and circular economy implementation? The DPP is, at its core, a circular economy instrument. The data it mandates — durability information, repairability scores, material composition, disassembly instructions, recycled content declarations — is the same data required to operate a circular product lifecycle. The European Commission designed the DPP to make circular performance visible and verifiable to consumers, regulators, and supply chain partners. The practical implication is significant: a manufacturer that implements circular capabilities via serialised product identity — with repair data, ownership transfer, and end-of-life records in a live system — is simultaneously building DPP compliance infrastructure. Each investment serves both purposes. A manufacturer that has not is facing a remediation project under deadline pressure, which is substantially more expensive than deliberate roadmap implementation. For manufacturers already planning a product identity programme, DPP readiness is not a separate workstream — it is the same workstream, at no marginal cost.
The Business Case: Circular Is Commercially Rational
Is there a financial case for circular economy implementation beyond regulatory compliance? The answer is yes, across three independent value streams. First, reduced warranty and waste costs: products that are easier to repair generate fewer replacement claims, and field data fed back into design reduces failure rates. The European Remanufacturing Network (2023) shows well-implemented repair programmes reducing warranty claim volumes by 15–25% over three to five years. Second, new aftermarket revenue: when manufacturers control repair information and parts supply, they capture margin that currently flows to third parties. A spare parts programme linked to product identity is a direct revenue stream at 40–60% gross margin, versus 15–25% on the original product. Third, brand differentiation and customer lifetime value: ESG scorecards are increasingly part of B2B supplier evaluation (Deloitte Global Sustainability Study, 2024), and a manufacturer who can demonstrate circular performance with product-level data holds a tangible advantage. A second-hand buyer with a good certified pre-owned experience is a first-time buyer of the next generation.
Frequently Asked Questions
Does circular economy implementation require replacing our existing ERP or PLM systems?
No. Product identity systems like BrandedMark sit at the product-facing layer — they manage the consumer and repairer experience, the scan endpoint, and the data presentation. They connect to ERP and PLM via integrations for parts data and bill of materials, but they do not replace those systems. The implementation path is additive, not disruptive.
Which product categories are affected by ESPR circular economy requirements first?
Textiles, electronics, batteries, and construction products are among the earliest categories with confirmed timelines. ESPR is a framework regulation, meaning specific product groups are addressed through delegated acts on a rolling schedule. Manufacturers of electrical and electronic equipment should assume requirements are imminent and plan accordingly. Checking the European Commission's ESPR product group schedule regularly is advisable.
How do competitors like Circularise, EON, and Kezzler approach this problem?
Several players in the product identity and transparency space have built circular economy offerings. Circularise focuses on supply chain data and chemical composition disclosure, particularly for plastics and materials traceability. EON specialises in brand-to-consumer digital product experiences with a sustainability angle, primarily in apparel and luxury. Kezzler offers serialisation and authentication infrastructure, with end-of-life data as a use case. Each addresses different parts of the problem. BrandedMark's approach integrates serialised identity, consumer-facing experience, repair access, and DPP-ready data in a single platform designed for durable goods manufacturers — without requiring multiple point solutions to be stitched together.
Where to Start
Where should a manufacturer begin when implementing circular economy via product identity? The answer is serialisation — and the timing matters. Manufacturers who start before regulatory deadlines avoid remediation costs that concentrate when ESPR compliance dates arrive for their product categories. Serialisation compounds over time: every unit that ships today with a live digital identity can participate in repair programmes, ownership transfer, and end-of-life recovery as those capabilities are layered on. Every unit without one requires a separate handling path — or must be written off as a circular economy gap. The first step is assigning a durable GS1 Digital Link QR code to every unit at manufacture and ensuring it resolves to a live, structured data endpoint. That single action creates the foundation on which every subsequent circular capability — repair access, ownership transfer, DPP compliance — can be built. BrandedMark gives manufacturers the platform to assign, manage, and activate product identity across every unit they ship, with circular economy capabilities built in from day one.