Barrier and Driver Factor of Circular Economy in Small-Medium Enterprises Using Fuzzy Delphi Method and DANP Method

most manufacturers use the traditional linear economy because their designs are open cycles that maximize the use of resources to create products and dispose of unused materials. Its value of linear production is mass production and selling products which raises the problem of excessive usage of resources. The circular economy (CE) is a production with a non-linear model which involves leasing, recycling, repairing, and refurbishing used resources to reduce waste as minimum as possible. It has been widely acknowledged because of the opportunity for sustainable production and environmental protection. According to research, small and medium-sized enterprises (SMEs) account for a high proportion of environmental pollution. Even though SMEs can be profitable and grow economically, they still struggle with incentives and financial restrictions. CE will help SMEs to improve resource efficiency, create a competitive advantage, and penetrate new markets. This research aims to assess and identify the challenges and main reasons why manufacturers use a circular economy in small-medium enterprises. A questionnaire has been constructed by collecting factors from different references that will be delivered to experts to assess. Using the Fuzzy Delphi method, the elements to be selected or rejected are sorted and determined based on the questionnaire results. Furthermore, the DANP stands for the Decision Making and Trial Evaluation method (DEMATEL), picking the relationship between factors, and Analytic Network Process (ANP), giving weights on which barrier and driver factors that important. For the first questionnaire, it concluded that 15 out of 20 barrier factors and 13 out of 22 driver factors passed the threshold value that had been set. For the remaining factors, the second questionnaire can be constructed for the DANP method to determine the ranking for both elements. As the driver factor, business growth has the highest weight value, which will be the main reason for implementing the CE. The consumer perception of reusing components is CE’s most significant challenge for barrier factors.