Challenges of the Introduction of Circular Business Models Within Rural SMEs of EU

Recently the circular economy has got a lot of attention within discussions of policy makers,academics and practitioners. The circular economy proposes the treatment of environmental andclimate change problems, simultaneously promising benefits for the business. The circular economypromotes the reduction of the consumption and reuse or recycling of the resources that in variousaspects contradicts traditional business models that stream to linear growth of sales of theirproducts. Yet the circular economy concept has been more discussed regarding its global scale, butthere is a lack of scientific discussions about the approaches of the adoption of circular economyprinciples on the business level. This paper conceptualises multi-level dimensions of the circulareconomy and highlights challenges related to the perception of the circular economy principles inthe micro business level. The conducted research shows that rural SMEs of six EU countries haverarely heard about the circular economy and even less about circular business models. While ruralSMEs are more familiar with the bio and green economies forming good base for developing circularbusiness models, they are reluctant towards introducing new business models. This paper aims toassess the level of the advancement in introduction of the circular business models among ruralSMEs of EU countries. This article emphasizes the circular economy as an inseparable part of thebusiness models of rural SMEs and rural economies of EU countries. This study has a policyimplication as we suggest that the government should play an important role in promotion ofcircular business models in rural SMEs. The existing public support system is fragmented, and inmost cases just incidentally encourage rural SMEs to adopt new circular business models. Also, thecircular economy on a local level, especially in rural areas, has an important role in ensuring socialwellbeing of local inhabitants. The methodological approach and research results presented in thepaper can be used further developing EU support system and priorities beyond 2020.