An awesome presentation from Dutch real estate developer Coert Zachariasse, CEO of Delta Development, from the Circular Economy 100 Annual Summit 2014.
Zachariasse’s presentation (and demonstrated business success) is a hugely refreshing breath of fresh air and is an outstanding reminder that customers are truly seeking innovative solutions that are both eco-positive and that demonstrate real value!
I’ve typed out one particular section of Zachariasse’s presentation that has huge ramifications for “green” investment:
Creating Buildings as Material Banks
You run into a process problem that is basically vested in the whole way the construction industry works. In normal procurement and tendering, I will dictate quality and the design team will work that out in tender documents. [The contractors] try to hit the bottom of our quality expectations at the lowest price. The whole supply chain is kept at bay as long as possible for negotiation reasons; that means you don’t integrate the supply chain. But we wanted to have control over our materials. So what we did is turn around the whole system: We made, as a developer, contracts with our sub-suppliers and instead of saying ‘we want this quality, give us your lowest price’, we made budgets for each part and said ‘this is your budget, give us your highest quality, and tell us what your product can do for total quality of the building’. And the interesting thing is that it gave us control over materials, it helped us build a material tracking platform. But one of the great side effects is that we lowered our cost price. By working from day one with our suppliers, you do what most production industries already know, you have to integrate your supply chain. Doing this has lowered our cost price; we’ve put that back in quality, and therefore we’ve made ourselves a whole different market.