THE ROLE OF THE CIRCULAR ECONOMY MODEL IN THE GREEN TRANSFORMATION OF SMALL BUSINESSES

The transition from a linear to a circular economic model is a central strategy for reconciling business growth with environmental sustainability. Small and medium-sized enterprises (SMEs), over 90% of businesses worldwide , still lag behind large firms in adopting circular economy (CE) practices. This thesis examines the role of the CE model in the green transformation of small businesses, drawing on peer-reviewed research, European Commission Eurobarometer data, and industry market reports. Using a qualitative, literature-based design, it synthesizes evidence on CE adoption rates, financial and environmental outcomes, and barriers, chiefly cost, limited expertise, and administrative complexity. Findings show circular practices are positively associated with resource efficiency, cost savings, and financial performance, while awareness and finance gaps remain the main constraints on adoption among micro and small firms. The thesis closes with policy and managerial recommendations for accelerating circular transformation in the small-business sector.