The circular retail transformation and its implications for circular logistics nodes: an integrative review Open Access

The circular economy is challenging the linear take-make-waste model and promoting sustainable consumption practices. The retail sector is playing a key role in this transformation. When retailers integrate circular economy principles such as product life extension, product-as-a-service and resource recovery, they can reduce environmental impact (Geissdoerfer et al., 2018). Retailers are uniquely positioned to facilitate circular flows and promote participation in reuse, repair or take-back services, thereby connecting consumers to product recovery processes (Vadakkepatt et al., 2021; Perotti et al., 2025). They may also generate profits by expanding market access, mitigating regulatory and reputational risks (Engzell and Kambanou, 2024), and normalizing sustainable consumption (Hultberg and Pal, 2023). The retail sector could therefore be instrumental in decoupling economic growth from environmental degradation (Zhang et al., 2023).

While the retail sector is key to the circular transformation, the latter is bringing change to retailing as we know it. Like the introduction of e-commerce and omnichannel, which were game-changers for retail (Kembro et al., 2018, 2022), circular retail comes with changing demands, requirements, and expectations. Circular retail relies on new business models (Konietzko et al., 2023), new actors and services, and physical infrastructure that enables circular product flows. From a logistics perspective, this means the role of logistics nodes (e.g. distribution centers, sorting nodes and retail stores) changes, transforming them into what we refer to as circular logistics nodes with new roles, responsibilities and operations. These circular logistics nodes are becoming increasingly important for, for example, matching supply and demand, coordinating flows, increasing logistics efficiency and customer utility, and reducing environmental impact. An increasing number of studies related to circular logistics nodes have been conducted across areas such as sustainability, marketing and supply chain and logistics, yet our theoretical understanding of these nodes remains limited.

The purpose of this study is to expand our theoretical understanding of the circular retail transformation and its implications for circular logistics nodes. We focus on circular retail stores as representative nodes and generalize these insights to a broader range of circular logistics nodes; if we understand how stores are transformed and impacted, we can extend that knowledge to circular logistics nodes in general. Retail stores are perfect representative examples for several reasons. First, many retailers begin their circular journey by conducting circular pilots in one or more retail stores. This implies that retail stores are entry points for many circular flows, and many lessons can be learned from both practical examples and extant research studies. Second, retail stores' geographic distribution, proximity to consumers, and existing physical infrastructure position them uniquely to interact directly with consumers (Bell et al., 2018). Retail stores have, according to Do Vale et al. (2025), the capacity to take on new roles within the retail ecosystem. Third, as retail stores connect consumers to reuse, repair and take-back initiatives, they are exposed to a range of circular operations such as collection, gatekeeping, assessment and pricing, sorting, cleaning, repairing and reselling. As discussed by Do Vale et al. (2025), the stores must undertake new responsibilities, shift their operations and develop new in-store competencies.

We address the purpose through a literature review (Kembro et al., 2025) and specifically through an integrative literature review (Elsbach and van Knippenberg, 2020; Cronin and George, 2023). Integrative reviews are suitable for synthesizing diverse sources of knowledge to develop theoretical insights in emerging research areas (Patriotta, 2020; Snyder, 2019). Due to the topic's interdisciplinary nature, knowledge about retail stores in a circular retail context does exist, but is fragmented across multiple domains (e.g. sustainability, marketing, logistics and supply chain). To our knowledge, no study has integrated extant knowledge to advance our theoretical understanding of retail stores as circular logistics nodes. The integrative review is timely and relevant given (1) the increasing pressure for sustainability and circularity transitions in retail, (2) regulatory demands (e.g. right to repair, extended producer responsibility) and (3) practitioners’ experimentation with circular services (i.e. services such as resale, repair or rental that are aligned with the circular economy principles) and circular operations (e.g. gatekeeping, sorting, pricing, cleaning, repairing, remanufacturing/refurbishing and reselling required to support services and flows) at the retailer's physical stores. Through our integrative review, we can identify which parts of the puzzle are complete, which are missing and whether some pieces no longer fit (Durach et al., 2021). It also helps us challenge old assumptions and plan future research in a more informed way.

Our findings aim at three audiences: researchers seeking a theoretical foundation for studying circular retail and circular logistics nodes, policymakers developing circularity regulations for the retail sector and practitioners integrating circular services in retail stores and other logistics nodes. This study is especially relevant for decision-makers in the retail sector, who must configure retail stores and other logistics nodes for the new circular retail context. The integration of circular services introduces new roles, collaborations and operational requirements that should not simply be incorporated into nodes configured for linear economies. Instead, retailers must undergo an appropriate node reconfiguration to the new context, balancing logistics efficiency and consumer utility. To address this reconfiguration, it is necessary to understand how the new context affects node configuration decisions, such as which circular operations can be integrated and how resources are developed and allocated.

The remainder of this article is structured as follows. First, we present the conceptual foundation and describe the integrative review approach. We then identify themes shaping the circular retail transformation and derive implications for retail stores, before aggregating our insights from the integrative review to discuss implications for circular networks, logistics nodes and resources, and build a research agenda. Finally, we conclude the study and present theoretical and practical contributions.

The integration of circular services reshapes the role of retail stores. Traditional retail (or brick-and-mortar) stores represent physical locations that interact directly with and sell products to consumers (Bell et al., 2018) with the main purpose to ensure that the right product is available in the right place, at the right time and for the right price (Fisher et al., 2000). Historically, retail stores have been configured as consumption spaces optimized for handling (receiving, sorting, storing and replenishing) forward flows of goods and services.

Over the years, the store role has been extended to support customer experiences through product discovery, convenience, entertainment and community engagement (Breugelmans et al., 2023). Alongside e-commerce and omnichannel, the store has assumed additional logistics responsibilities (Kembro et al., 2022), including movement of products from store to consumer through additional services such as home delivery and click-and-collect (Mou et al., 2018; Huebner et al., 2022). It also includes reverse flows (customer returns), which require gatekeeping, collection and sorting (Rogers and Tibben-Lembke, 1998). These new roles have reshaped the store layout (e.g. shop floor vs. backroom space) and put additional requirements on resources such as skilled labor, equipment and technologies to handle product flows efficiently (Esbjerg et al., 2010).

In a circular economy, retailers delegate new functions to retail stores to facilitate the repair, rental and resale of used products. As such, retailers use stores as local nodes for circularity (Do Vale et al., 2025), where a range of new operations (in addition to existing ones) must be undertaken to support new services and flows. This includes, for example, gatekeeping, additional sorting, inspection, pricing, cleaning, repairing and reselling (Table 1) (Wilson and Goffnett, 2022). These new functions entail multiple configuration requirements across operations, design and resources (see Kembro et al., 2018), transforming retail stores into what we refer to as “circular logistics nodes.” For this article, we refer to circular logistics nodes as physical nodes that are configured (through operations, design and resources) to enable circular economy principles by collecting, processing (e.g. gatekeeping, grading, pricing, sorting, cleaning, repairing, remanufacturing) and redistributing products.

In a circular ecosystem, a range of circular logistics nodes – all with different roles and purposes – evolve to facilitate circular flows. This includes, for example, repair centers, recycling centers and resale warehouses. What is unique about retail stores is that they can take on a wide variety of roles and responsibilities. As examples from practice have shown, retail stores can function as sorting hubs, repair centers and resale nodes simultaneously. One reason that retail stores have taken on so many different roles is that many retailers have started their circular journey and conducted circular pilots in one or more retail stores. In other words, retail stores are entry points for many circular flows, and there are many lessons to be learned. As we argue in this article, this means that if we can understand how the store is impacted and transformed, we can extend this knowledge to circular logistics nodes in general. We therefore focus on retail stores as representative circular nodes. We also recognize the interdependence between node transformation, logistics network structures and resource development. For example, as emphasized by Kembro et al. (2022), the transformation of a node directly affects the logistics network (re)configuration and vice versa. For this study, we draw inspiration from existing supply chain theory traditions (e.g. network theory and the ARA model) and anchor our analysis and discussion in a network-node-resource perspective.

In the context of circular retail research, an integrative review approach is appropriate because existing studies are scattered across multiple disciplines. Each domain explores circular retail through its own lens. There are parallel discussions across marketing (Kant Hvass and Pedersen, 2019), operations management (Lopes de Sousa Jabbour et al., 2019; Farahani et al., 2022; Bernon et al., 2018), logistics and supply chain management (Bressanelli et al., 2019; Beh et al., 2016; Mallick et al., 2023) and sustainability research (Hultberg and Pal, 2023; Bergmann et al., 2025; Zhang et al., 2023). This fragmentation results in siloed knowledge of circular retail. The conducted integrative literature review allowed us to synthesize knowledge (Cronin and George, 2023), build conceptual bridges, gain new insights from interconnected disciplines (Kunisch et al., 2023; Tsoukas, 2009) and expand research boundaries (Krlev et al., 2025). An overview of the review design is presented in Figure 1 and explained in more detail in the following sections.

A number of reviews have highlighted retail stores as pivotal in advancing the circular economy, primarily focusing on their role in influencing sustainable consumption (see, e.g. Farahani et al., 2022; Vadakkepatt et al., 2021), their strategic significance (see, e.g. Bernon et al., 2018), their role in facilitating product collection (see, e.g. Choudhary et al., 2022; Kant Hvass and Pedersen, 2019; Stål and Corvellec, 2018) or through serving as logistical hubs and points of consumer interaction (Do Vale et al., 2025). By conceptualizing stores as circular logistics nodes, we bring together scattered insights and examine how circular retail transforms such nodes. Alongside the integrative approach, we employed the process proposed by review research within the field of logistics and supply chain management (L&SCM) to minimize the risk of overlooking fundamental studies and reduce selection biases (Durach et al., 2017).

To scope the research, we first conducted a pilot literature review using the keyword combinations (retail) AND (logistic* OR supply chain) AND (circular economy). This search resulted in a sample list of 36 articles (henceforth referred to as the “validation list”). We used this list to establish the conceptual foundation and define circular retail stores as the unit of analysis. We also organized a workshop with an expert panel, which helped us broaden the scope of the study and establish its industry relevance. These insights helped us define the characteristics and boundaries of the review study. We specified the following inclusion and exclusion criteria for literature selection.

1. Selected publications must center on the circular economy within the context of retail or operations/logistics/supply chain. Studies addressing other domains (e.g. construction, critical materials, agriculture) and articles addressing general sustainability themes without an emphasis on circular economy principles were excluded.

2. The review focused on the technical cycle of the circular economy, so papers related to the biological cycle (e.g. composting, biogas, regenerative material, feedstock or raw materials extraction) were excluded.

3. Within the technical cycle, the review focused only on loops handled at retail stores (e.g. collection, maintain/prolong, reuse/redistribute). We therefore excluded remanufacturing, which involves restoring products to like-new conditions through industrial processes at specialized facilities. Likewise, recycling and waste management were excluded, as they imply breaking down products into materials. However, if a paper described the store's role in facilitating collection, performing minor repairs or selling remanufactured products, it was included in the review.

4. The publications explicitly or implicitly referred to the role of retail stores. Examples include references to retailer collection, in-store repair or return processes, or other operations taking place within the physical store.

5. The review considered durable products rather than perishable ones (e.g. grocery products), since perishability introduces different circular challenges (e.g. shelf life, food safety, waste management) and different considerations for the circular retail transformation of the logistics nodes. We refer to the complementary discussion by Schäfer et al. (2025) and Riesenegger et al. (2023) on the intersection between food waste and grocery retail store operations and characteristics.

Next, we developed a search strategy in collaboration with librarians. Librarians, who can be considered experts in processing the ever-growing plethora of literature (Durach et al., 2017), provided guidance on search strategies, databases and keywords. This enhanced the quality, transparency and credibility of the search process and the literature included. The search terms were developed in three stages. First, we extracted a list of keywords from eight key papers ^[1] selected from the validation list. We then structured the keywords using an L&SCM-adaptation of the PICO framework (Population, Intervention, Comparison, Outcome), traditionally used in medicine (Booth et al., 2022). The structure comprised Setting, Intervention, and Outcome: (1) the setting established the subject under study (e.g. retail terms), (2) the intervention captured process concepts (e.g. repair, reuse, rental, reverse logistics) and (3) the outcome covered the expected achievement (e.g. circular economy, circular logistics, circular business model). The three search strings (Table 2) were combined using the Boolean operator AND to obtain publications relevant to all three research areas. Finally, the search strategy was iteratively refined by the research group and the librarians. In each round, we compared whether all 36 articles from the validation list were retrieved.

The resulting papers were filtered based on Web of Science and Scopus categories, document type and language (see  Appendix). After applying the filters, 7,491 publications were retrieved. Due to the surplus of published literature and concerns about predatory journals, we opted to include only publications from reputable journals listed in the Academic Journal Guide (AJG) rated 2 or higher, but we made an exception for the Journal of Cleaner Production. We acknowledge that this journal was downgraded to a rating of 1 in the 2024 AJG, yet we considered it appropriate to include the 550 publications from this journal prior to the reclassification. Consequently, the final search strategy yielded 4,539 unique hits.

From this sample, we screened articles and selected the synthesis sample. We used COVIDENCE to structure and organize the literature. On this platform, keywords from the inclusion and exclusion criteria were highlighted to support initial screening based on title and abstract. It was then followed by a full-text screening by the authors. To ensure a rigorous process, the selected articles were compared against the validation list, and for each selected article, the references and citations were checked to identify missed key articles. To reduce selector bias, studies with uncertain eligibility were flagged and later discussed among the researchers to reach a final decision. The synthesis sample comprised 111 articles.

The final step of the review was to synthesize the data. We employed an inductive theory-building review approach to: (1) explore a topic with nascent theory and limited understanding and agreement on the studied phenomena (Durach et al., 2021), (2) go beyond literature description to discover new concepts and advance the conceptualization of the field (Seuring et al., 2020) and (3) develop a future research agenda to energize the research stream (Ketchen and Craighead, 2023).

First, the papers were analyzed with respect to, for example, publication year, unit of analysis, research methods, the circular economy principle applied and industry sector. As of March 2026, when this review was conducted, we observed a spike in publications, underscoring the topic's relevance. The sample was composed mostly of papers focused on supply chain management (37), consumer behavior (28) and circular business model innovation (27). Our review revealed a lack of focus on retail store configuration for a circular economy, but rich knowledge related to retail organizations and the integration of circular business models. In terms of sectoral distribution, more than 50% of the reviewed studies adopted a cross-industry perspective (53), covering circular retail practices with a multi-sectoral focus. Sector-specific studies included fashion/textiles (35 publications) and electronics/white goods sector (16). Other retail sectors, such as furniture, sporting goods and toys, are included in multi-sectoral studies. Similarly, in terms of circular economy principles, most publications took a general approach (55), followed by reuse/resale (27), rental (6), take-back (10), refurbish/remanufacture (6) and repair (7). This body of knowledge distribution reveals a concentration in specific retail sectors and practices. Sectors such as fashion and electronics are well represented in the literature due to product lifecycles, policies and market opportunities to reach more consumers. This distribution may limit the generalizability of the findings to other retail contexts.

Next, the full-text publications were open-coded using NVivo. From each study, the concepts, ideas, and themes were extracted (within-study). We then compared the insights from articles and synthesized and grouped them to form an initial set of themes (cross-study). We followed an approach similar to Gioia et al. (2013), which consisted of an iterative process between the first-order concepts and second-cycle themes (Figure 2). Initially, some concepts were classified as second-level themes. After reviewing additional literature, we adopted a top-down approach, leading us to partition certain second-level themes back into first-level concepts and reorganize them into emerging second-level themes. The generated themes were then assessed and discussed to reach consensus within the research group. As a result, the authors grouped the research themes into aggregated dimensions and relabeled the codes for improved coherence. Various ways to group the themes were discussed throughout this process. We acknowledge that other categorizations may have been possible and that our suggestions should be validated in future research.

The final step was to discuss the implications for circular retail stores (see section 4) and extend these insights and implications to the broader range of circular logistics nodes (see section 5). After the thematic analysis, we explored how each identified theme could influence retail store configurations. For this, we took inspiration from disciplined imagination (Weick, 1989), which allowed us to build on the identified themes and generate a wide set of implications of circular retail transformation for store configuration. As part of this process, we explored various directions and contrasted the circular retail transformation requirements with those of linear retail, allowing us to generate ideas, challenge assumptions and envision how retail store configurations could adapt. We then applied consistent, logical rules and reality checks to evaluate and refine those implications. In some cases, the implications spanned multiple themes or built on insights from earlier themes, reflecting the iterative nature of our analysis.

To extend the implications from the retail store context to the circular logistics nodes, the researchers engaged in additional discussion sessions. During these sessions, we reviewed the themes and implications for retail stores. We then established how these implications could be adapted to the circular logistics node by considering the similarities and differences between the two settings. The sessions allowed triangulation of perspectives and reduced bias. In the final stage, we had a list of implications for circular logistics nodes for each of the seven themes. We analyzed this list and identified the three clusters of implications: network-node-resources. We then aggregated the insights for each cluster to structure our implications section and to develop propositions for future research. An overview of the analysis steps is displayed in Figure 3.

In this section, we present seven themes that shape the circular retail transformation. For each theme, we use the reviewed literature to understand this transformation and discuss implications for retail stores. Section 5 then “reassembles” these insights at a resource-node-network level to discuss implications for circular logistics nodes.

Retailers offer circular services due to market expansion and sometimes as ‘sustainability patches' influenced by regulations such as Extended Producer Responsibility, Ecodesign for Sustainable Products Regulation, Right to Repair or Digital Product Passports (Do Vale et al., 2025; Vadakkepatt et al., 2021). For example, the European Extended Producer Responsibility directives aim to shift the responsibility of product recovery upstream from individuals to producers (Liu et al., 2022), the reinforcement of the Right to Repair makes repair services and spare parts more accessible to consumers (Richter et al., 2023) and the upcoming Digital Product Passports aims to increase transparency in the product value chain and assign unique identifiers to different products (D'Adamo et al., 2025). Retailers respond to institutional pressures: coercive (e.g. contracts, audits), normative (e.g. society, ethics, consumers) and mimetic (e.g. imitation of successful peers) (Bussolo et al., 2026). Similarly, retailers integrate circular services for economic reasons, even if the services are not profitable, can build consumer relationships and strengthen brand image (Sandberg, 2023; Murtas and Pedeliento, 2025; Mrad et al., 2025), expand their product assortment or influence product valuation (Abdulla et al., 2024; Zhang et al., 2019).

A common concern among retailers is that policymakers should reconsider tax structures and incentives, as these can act as barriers or drivers of circular transformation (Engzell and Kambanou, 2024; Guldmann and Huulgaard, 2020; Corbier et al., 2026). One example is the concern about multiple taxation of circular services relative to linear consumption (Koers et al., 2024; Curran and Joltreau, 2026). In Sweden, for example, the Parliament in early 2023 voted to increase the value-added tax (from 6% to 12%) on repairs across multiple product categories (e.g. shoes and clothes) (Skatteutskottet, 2023). This decision had an immediate impact on a range of retailers that were in the initial stages of piloting circular services.

Collectively, these changes pressure retailers to reconfigure their store operations (potentially multiple times) to align with ongoing shifts in consumer preferences and the regulatory environment. Retailers should therefore enable continuous reconfiguration through flexible (modular) layouts and the integration of circular services in the core of retail-store configuration (Zhang et al., 2023; Bocken and Konietzko, 2022). By keeping up with new laws and regulations, and adapting retail stores accordingly, retailers can gain a competitive advantage (Bergmann et al., 2025; Jayaraman and Luo, 2007; Barletta et al., 2024). All in all, the rapid changes in laws and regulations place great demands on the retail organization. As such, staff must be forward-looking, understanding not only market trends but also political decision-making and other macrotrends (Kühl et al., 2023).

In circular retail, the consumers take on the role of suppliers (Hultberg and Pal, 2023; Farahani et al., 2022; Kant Hvass and Pedersen, 2019). This implies a directional shift in material, information and financial flows, whereby consumers initiate these flows by moving products for resale or repair (Gatenholm et al., 2021). Consumers engage with circular retail in different ways. Some participate as suppliers, some remain as buyers, and others take a dual role as both buyers and suppliers (Perotti et al., 2025). Thus, it is necessary to understand both consumers' preferences and their supplier capabilities.

Consumers engage depending on convenience, economic incentives and/or the perceived effort required to prepare and hand over products (Dukovska-Popovska et al., 2025; Gunasekara and Robb, 2025). Retailers can leverage consumers' roles and encourage them to contribute to operational efficiency by, for example, preparing the product (e.g. cleaning or packing) in a specific way (Costanza, 2025; Sandberg and Hultberg, 2021) or providing input data (e.g. product characteristics). This could reduce the workload and cost for retail staff in circular operations (Hultberg and Pal, 2023). In parallel, it is necessary to increase convenience, for example, by providing accessible collection locations (Darley and Lim, 1999; Dukovska-Popovska et al., 2025; Arevalo-Ascanio et al., 2025). Sandberg and Hultberg (2021) and He et al. (2024) suggested that locating circular services near shopping areas, residential areas or at points of purchase can make circular retail more convenient to consumers and drive participation.

Introducing the circular consumer has multiple implications for retail stores. Most importantly, retailers must understand consumers' motivations and how they interact with the store as buyers and suppliers (Abbey et al., 2015; Hedegård, 2024; Shin et al., 2026). Research emphasizes that consumers' motivations for purchasing secondhand products can be segmented into bargain seeking, availability of unusual products, ethical and ecological considerations and economic incentives (e.g. vouchers or discounts) (Prisco et al., 2025; de Vicente Bittar, 2018; Edbring et al., 2016; Ki et al., 2021). Consumers also express various concerns toward sustainable consumption, such as contamination, authenticity, social status, superstitious beliefs and value for money (Clube and Tennant, 2020; Murtas and Pedeliento, 2025; Tangri and Yu, 2023). Retail stores offer consumers the opportunity to physically inspect remanufactured or second-hand products (Pandey et al., 2024). In addition, consumer preferences could affect store format and service design. Some consumers might prefer to be independent through Do-It-Yourself (DIY) models, such as self-repair stations that provide tools and resources. Others might choose Do-It-Together approaches, in which staff or volunteers offer guidance, such as repair cafés or community workshops. Alternatively, consumers may prefer Do-It-For-You models, relying on retailers to handle repairs, resale or returns on their behalf (Costanza, 2025).

Retail formats are evolving to accommodate these various preferences, including dedicated repair spaces, peer-to-peer exchange events (Kant Hvass, 2015) and resale platforms that enable resale (Murtas and Pedeliento, 2025). The different consumer preferences imply that not all stores will deliver circular services in the same way. This creates a need for role differentiation (Do Vale et al., 2025; Keshavarz-Ghorbani et al., 2025), in which the store configuration aligns with the predominant role, and the need for downstream integration with consumers (Pellegrino et al., 2026). Some stores may specialize as collection points, while others can serve as hubs for resale, repair, or rental services. These decisions are influenced by factors such as geographic location and local consumer demand (Ghadge et al., 2016; Amiri-Aref and Doostmohammadi, 2025). Drawing on the consumer contact model (Chase, 1981), the required level of consumer interaction affects store configuration. Unlike traditional retail stores, the dual role of the consumer directly influences backroom processes (e.g. supply, cleaning, sorting), blurring the line between front and back operations. Logistics efficiency and customer utility must therefore be achieved in both front- and back-end. That said, some degree of flexibility is required to accommodate adaptive processes for handling product variability, condition assessment and case-specific processing. These challenges point to the emergence of different types of nodes tailored to consumer roles and preferences, as a continuous mapping of the logistics node portfolio from current to future consumer preferences.

In circular retail, supply is decentralized (as consumers become suppliers) and is no longer a controlled pipeline. Especially in resale services, supply is largely unknown and uncertain, and retailers struggle to predict the volume, quantity, quality, timing and location of used products (Bressanelli et al., 2019; Jayaraman and Luo, 2007). Retailers also face operational challenges related to inventory management and the need for balancing collection frequency with the geographical spread of collection points (He et al., 2024).

The success of resale services depends on effective product acquisition (Vadakkepatt et al., 2021; Jayaraman and Luo, 2007). Retailers rely on various sourcing channels, including local charity organizations, direct consumer collections, recycling centers and third-party organizations (Beh et al., 2016). Some collection methods are gaining popularity, such as home collection services (Farahani et al., 2022; Dukovska-Popovska et al., 2025; Mrad et al., 2025) and in-store collection programs incentivized with discount vouchers (Cai et al., 2022; Taleizadeh et al., 2023). Like traditional retail, the secondhand market is subject to rapidly changing trends and demands (Wilson and Goffnett, 2022). To maintain a steady flow of merchandise, retailers need to balance the need for continuous stock replenishment with the risk of accumulating slow-moving products (Appelgren, 2022).

The issue of supply has multiple implications for retail stores. First, retailers must understand how the store's geographical location influences supply uncertainty (Glackin and Adivar, 2023; Ghadge et al., 2016). Urban stores might benefit from higher collection volumes and proximity to consumer supply (Arevalo-Ascanio et al., 2025), but these locations also entail higher rents and operational costs, which can undermine profitability for circular services operating on lower margins. One way forward is to use stock transfers between stores, which requires stores to act as both local service points for consumers and fulfillment centers for other nodes in the retail network (Amiri-Aref and Doostmohammadi, 2025). Second, retailers must deal with receiving uncertain, inconsistent and sometimes poor-quality supplies (Gunasekara and Robb, 2025). These issues require increased backroom space and a flexible layout to handle, for example, sorting, cleaning and repairs. Poor quality can also slow throughput, increase waste streams and require staff to perform constant quality assessments and sorting operations. Meanwhile, the front-end must be designed as a modular, reconfigurable system to accommodate variable product categories, fluctuating quantities and mixed product types.

An important consideration is whether retail stores depend on centrally made decisions or can act as autonomous circular service hubs (with freedom, e.g. in decision-making, operations and layout design (Pal et al., 2019). The way circular services are controlled, by whom, and for what purpose has direct implications for retail stores' operations, the services they can offer and how they engage with consumers in a circular economy (Frei et al., 2020; Prajapati et al., 2022; Pellegrino et al., 2026). Previous studies have shown that when linear retailers integrate services, decision-making relies on the corporate level. This centralization supports operational standardization but introduces bureaucratic layers that reduce flexibility and innovation (Reineke et al., 2025). Unlike linear businesses, the supply and consumption of circular services are local, which calls for more localized setups (Bryson et al., 2024). When stores are given autonomy, they have a greater capacity to adapt collection and delivery services to local needs, strengthen customer relationships and improve operational efficiency.

Another important aspect concerns the interaction between different actors. Power and responsibility are distributed across multiple stakeholders (e.g. manufacturers, consumers, nonprofit organizations, 3PL, municipalities) (Mallick et al., 2023; Timoumi et al., 2021; Perotti et al., 2025). Some of these compete to secure the supply of high-quality products (Persson and Hinton, 2023; He et al., 2024), and others collaborate in operations (e.g. collection, sorting) due to the complementarity of resources and skills (Farahani et al., 2022). Through collaboration, some retailers choose to fully outsource circular services, which simplifies internal processes but can lead to loss of operational control (Stål and Corvellec, 2018; Hansen and Revellio, 2020). Full service outsourcing also removes the opportunity for retailers to be close to consumers (Bocken and Konietzko, 2022; Kant Hvass, 2015).

For retailers, there are three main implications. First, they need to decide whether to decentralize or centralize decision-making, resources, knowledge and various operations. This depends on clarifying where in the network value is created and where structural changes are needed to enable integration of the services (Miao et al., 2017; Wang et al., 2019). In some cases, retailers need to grant semi-autonomy to retail stores to adapt to local contexts, experiment with new formats or collaborate with local partners (Bryson et al., 2024; Beech et al., 2025). Granting this autonomy may seem straightforward in single-store contexts, but it becomes more complex for multi-store retailers. Here, the challenge is to balance operational consistency and localized relevance. Second, it is also important to understand the interactions between retail stores and external stakeholders and to clarify responsibilities and capabilities. By doing so, retailers can determine which operations to outsource or retain in-house (Wilson and Goffnett, 2022). Outsourcing or centralizing can alleviate retail stores from certain operational responsibilities (Stål and Corvellec, 2018) but may increase the need for coordination with partners to align, for example, processing capacity or shipments. This type of coordination has not previously been handled by retail stores. Third, ownership of circular services affects power dynamics within the circular logistics network. When retail stores manage circular services themselves, they gain greater control over products in the local market and redistribute them as an alternative supply model, thereby reducing their reliance on linear suppliers.

An important decision is whether circular services and operations should be integrated into existing linear structures (store-in-store) or treated as stand-alone formats (Kant Hvass, 2015; Sinha et al., 2026). The interplay between operational efficiency, sustainability and strategic alignment shapes this decision (Savaskan and Van Wassenhove, 2006). On the one hand, piggybacking on existing infrastructure can keep fixed costs low and enable resource sharing in the store (e.g. put-away and displaying products for resale or collection) (Das and Chowdhury, 2012). On the other hand, each flow has different characteristics. Hence, organizations cannot rely on current operations and partners to achieve efficient circular services (Wilson and Goffnett, 2022). The decision to integrate or separate circular from linear also influences (diversifies) the shopping experience and the risks associated with entering circular markets (Kant Hvass, 2015).

Another important decision concerns the scaling of these circular operations. Circular services typically start as small initiatives, such as in-store repair or offering resale services, which set the stage for larger transformations (Hultberg and Pal, 2023; Lopes de Sousa Jabbour et al., 2019). These early efforts help retailers test circular services and refine their approaches through practical pilot programs and experimentation (Bocken and Konietzko, 2022). Retailers then typically consider whether and how to scale the operations. There are multiple ways of scaling, for example, scaling from one market to more, from one store to many, online scale-up before going store-to-store, scaling country by country (Hultberg, 2025) or diversifying into other circular services (e.g. maintenance, repair or rental) (Beulque et al., 2023). Scaling circular services can attract new customers but may also jeopardize sales of new products and resources (Kant Hvass, 2015). For example, Houdini Sportswear's rental service created internal competition with traditional retail sales (Holtström et al., 2019). The scaling may also increase operational complexity, which reduces logistics efficiency (Sandberg and Hultberg, 2021; Pal et al., 2021).

The integration and scaling decisions have multiple implications for retail stores. First, to deal with operational complexity and enable scalability, retailers must learn from linear retail and simplify and standardize circular operations as much as possible (Sandberg and Hultberg, 2021). The reason is that circular operations are typically highly resource-intensive (Mont et al., 2006; Güsser-Fachbach et al., 2023). For example, in resale services, each unique item must be individually assessed, graded, categorized, sorted and tracked to determine the disposition route (Hultberg and Pal, 2023; Sandberg and Hultberg, 2021). Here, sorting is considered one of the most space- and time-consuming circular operations (Dukovska-Popovska et al., 2025; Ekström and Salomonson, 2014). Efficient sorting requires space and time to (1) sort when receiving the product to gatekeep, (2) sort depending on the product condition and service needed (e.g. repair, repack, clean), (3) sort depending on the commercialization channel (e.g. online or in-store), (4) sort by category when displaying (e.g. by trend, size, color or specific product characteristics) and (5) sort for services carried out in other nodes (e.g. cleaning, grading, pricing, repairing, refurbishing, repacking, sorting) (Farahani et al., 2022; Choudhary et al., 2022).

Second, retail store formats must be adapted for the new, context-specific, circular services (Denizel and Schumm, 2024). This implies that not all retail store types may be suitable for integrating circular services (Keshavarz-Ghorbani et al., 2025). For example, rental or resale services could be mixed with linear sales, but repair services could work better in an outsourced or pop-up format (e.g. Patagonia's free-repair pop-up car). It also means that retailers must reassess existing store classifications regarding linear versus circular offers and product range (SKUs, colors, sizes). For instance, full assortment stores that add circular offers may require reclassification as medium assortment stores (due to reduced space for linear). New store classes might be developed, such as ‘medium assortment store with repair service’ or ‘small assortment store with pop-up resale service’ (Beech et al., 2025).

Third, integrating linear and circular could improve logistics efficiency and profitability. Nevertheless, this approach is constrained by limited in-store space (Kant Hvass and Pedersen, 2019; Dutta et al., 2016) and may cannibalize the store's capacity, with new operations, space needs and staff allocation (Hultberg and Pal, 2023). In contrast, separated (dedicated) circular stores might mitigate cannibalization risks but would require additional investments. Examples include Uniqlo, Levi's and Nudie Jeans, which offer in-store repair and customization, and Patagonia Worn Wear and ASKET, which have separate resale stores.

Integrating digital technologies, IT systems and automation in logistics nodes plays an important role in improving and scaling circular services (Butt et al., 2024; Saha et al., 2021). Technologies can streamline back-end operations and enhance efficiency (Colucci and Vecchi, 2024; Bocken and Konietzko, 2022). For example, AI-driven technologies can improve sorting, sales forecasting and pricing, and RFID technology can enable product tracking (Liu et al., 2023; De Giovanni, 2022). Integrated IT systems, integrated data management systems and digitalization enhance data flow (Frei et al., 2020; Mallick et al., 2023). However, adopting new technologies poses challenges for retailers, such as initial investments in hardware, software and training (Hultberg and Pal, 2023; Brändström et al., 2024); integration with existing systems (Vadakkepatt et al., 2021) and data security. Sandberg (2023) noted that introducing automation requires careful planning, information and access throughout the circular ecosystem to enable integration across nodes.

Given that technology is still in its infancy, retailers must improve their internal capabilities to upskill and facilitate knowledge exchange (Saha et al., 2021; Eisenreich et al., 2022; Schoonover et al., 2021). Researchers emphasize that staff skills are crucial for circular operations such as gatekeeping, sorting and grading (Wilson and Goffnett, 2022; Colucci and Vecchi, 2024; Gunasekara and Robb, 2025). One of the main challenges is the difficulty in recruiting and training a skilled workforce (Engzell and Kambanou, 2024; Beulque et al., 2023). The circular transition, therefore, requires investments in training systems, routines and new capabilities specific to circular services (Von Kolpinski et al., 2023). Sharing information through guidelines both enables and supports scaling of circular services (Sandberg and Hultberg, 2021; Lopes de Sousa Jabbour et al., 2019).

Technological development and evolving skill requirements have multiple implications for retailers and their stores. First, adopting technology can increase the scalability of retail store operations by, for example, enabling efficient returns processes and tracking (Bernon et al., 2018). For instance, the use of digital product passports can enhance product traceability, record product details and capture historical data (e.g. processes, repair cycles, uses) to aid sorting, collection and repair operations (D'Adamo et al., 2025; Acciai and Pérez-Bou, 2025). Artificial intelligence (AI) can support circular services by automating time-consuming operations, supporting decision-making processes and tracking large volumes of unique products (AL-khatib and Ramayah, 2025). For example, Peng et al. (2023) discussed how AI applications could be used for secondhand pricing, an operation that otherwise risks subjectivity and reliance on individual employees' tacit knowledge. Robots and scanners could assist staff with operations such as sorting or repairing; for example, Nike launched an in-store robot that cleans and repairs shoes using augmented reality and 3D technology to boost repair rates (Dowling, 2023).

Second, retailers need to develop store employees' competencies to match the skill requirements of circular services (Bressanelli et al., 2019; Gatenholm et al., 2021; Sandberg and Hultberg, 2021). This includes, for example, evaluating and pricing secondhand products, negotiating to buy back from consumers and using creativity to support operations such as upcycling and repair (Colucci and Vecchi, 2024; Wan and Aggarwal, 2024; Hedegård, 2024). Pal et al. (2021) emphasized the importance of simplifying and standardizing operations in remanufacturing settings to support staff. For retail stores, this translates to, for example, categorizing products into more organized, general units or creating manuals to standardize operations. Other examples include product evaluation matrices for retail staff, product preparation guidelines and product pre-evaluation tools such as grading, sorting or pricing. Retailers can support skills development for store staff by employee training programs, good working conditions, incentives for sustainability and integration of circular targets into staff performance metrics (Costanza, 2025).

Measuring the performance of circular services is important but complex, and the scaling of circular services often falls short (Kant Hvass and Pedersen, 2019; Hultberg and Pal, 2023). One reason is that performance indicators focus on sales revenue and cost minimization, which do not favor circular services. Organizations must therefore shift from focusing on financial performance (e.g. cost and profit) to also consider nonfinancial indicators (e.g. innovation, customer satisfaction, firm competitive advantage and environmental and social impact) (Eisenreich et al., 2022; Bonifazi et al., 2025; Elf et al., 2022). Wilson and Goffnett (2022) and Zhang et al. (2023) propose performance indicators to enhance visibility (e.g. returned products as a percentage of sales, percentage of returned products diverted from landfills and handling cost per item). Stål and Corvellec (2018) suggest that indicators should focus on the treatment of collected garments rather than on the number of stores offering collections. Measuring performance based on collected and resold volumes often assumes that each resold item substitutes the production and sale of a new one, which is not necessarily true (Hultberg and Pal, 2023). Another important challenge is the lack of data. Zhang et al. (2023) and Bernon et al. (2018) noted that organizations frequently lack data on circular services. This leaves retailers unaware of the destination of returned products, whether they are stocked on shelves or sent to warehouses, manufacturers or recycling centers (Frei et al., 2020).

For circular retail stores, a key implication is the adoption of performance indicators that incorporate sustainability and circularity (Bocken and Konietzko, 2022; Lopes de Sousa Jabbour et al., 2019; Choudhary et al., 2022). For example, switching from targets on collection and recycling to targets specifically on reuse or repair could address preferences for recycling routines (Bocken and Konietzko, 2022; Richter et al., 2023) and recognize the different circular innovations (Sinha et al., 2026). In practice, resale and repair services can co-exist with continued overproduction and overconsumption. Stores, therefore, need performance indicators that go beyond output metrics (e.g. number of repairs or items collected) and capture net environmental impact, avoided emissions or material savings (Zhang et al., 2023). Retailers must understand that circular services prioritize consumer loyalty and long-term value preservation, which do not yield immediate financial results (Do Vale et al., 2025). For example, promoting reuse or repairs may reduce sales of new products, which may conflict with existing incentive structures such as commission-based sales targets or stock turnover (Wilson and Goffnett, 2022). Without revising staff reward systems, there is a risk that store employees might deprioritize circular operations, treat them as secondary or discourage customer participation.

At the operational level, performance indicators should track data, including processing cycle time, handling cost per item, percentage of products reused and diversion from landfill (Zhang et al., 2023). Without tracking systems, retailers cannot make informed decisions about how to scale the service or reduce their environmental footprint (Hultberg and Pal, 2023). For instance, stock rotation in circular services, such as secondhand or repaired products, may not align with traditional inventory turnover metrics. Circular stores may be too quick to discount slow-moving items, contrary to the aim of extending product life. Similarly, uncertainty from consumers or processing hinders measurement of variables such as availability, supply, demand or lead times (Bengart and Vogt, 2025).

So far in this article, we have discussed seven themes that shape the circular retail transformation and their implications for retail stores. In section 2 of this article, we argued that, as retail stores assume various roles as circular logistics nodes, these insights can be generalized to a broader range of nodes in circular logistics networks. The following section extends these implications to the circular logistics nodes (see section 3.3 and Figure 3). Figure 4 conceptualizes the circular system with three interdependent configurations: (1) the circular logistics network (i.e. logistics structures, collaboration and node portfolio), (2) the circular logistics node (i.e. operations, infrastructure, KPIs) and (3) circular resource development (i.e. technology, competencies). A change in any one configuration affects the others.

As retailers scale up their circular business, the logistics networks grow in terms of the number and types of nodes (e.g. sorting hubs and repair centers). The portfolio of nodes is tailored to market opportunities, policy pressure and consumer preferences. This requires several strategic considerations: First, what type of nodes are required in the network? This decision depends on a range of factors such as circular service offerings and product characteristics. Second, should the network/nodes be centralized or decentralized, or a combination of both? Decentralized nodes handle lower volumes and more varied products, while centralized nodes have the potential for higher volumes, scale economy and standardization, but risk detachment from the circular suppliers and customers (which may cause bureaucracy, long lead times and need for tracking). Third, who (i.e. what node/actor) owns versus is responsible for each service, product flow, circular operation and resource in the network? This includes the strategic consideration of outsourcing, which has implications for the type of nodes (e.g. sorting hub, repair center, recycling center) a retailer needs to configure and manage or collaborate with.

Retailers therefore need to analyze their growth and circular service offerings and compare them with their logistics nodes' capacities (e.g. space, equipment and resources) to perform the required circular operations. This requires continuous mapping of logistics nodes portfolios and their fit with current versus future consumer preferences. Retailers also need to match the required circular logistics operations to each node in the network. For example, retailers must decide which nodes should handle the incoming supply (all or a selected few). Sorting emerges as a key capability whereby retailers need to map sorting across the network of nodes and decide which nodes handle which sorting operation. As argued by Kembro et al. (2022), this suggests that a decision on a network level has implications on a node level and vice versa. Implications on both levels must be understood. Coordination between the various nodes is important, for example, to balance supply and demand across the system and identify and handle seasonality and uncertainty in supply. Retailers must also clarify where the business and operational decision-making will take place: at headquarters or at the local node. From a long-term perspective, retailers may need to embrace agile governance so that local nodes can adapt to dynamic markets, products and customer needs.

Over decades, retailers have built up a linear mindset to enable efficient logistics and customer utility. These retailers now face “circular chaos” with changing customer preferences, uncertain supply and demand, a broad range of unique secondhand products and resource-intense operations (e.g. grading, gatekeeping and pricing) required to assess and sort circular flows. Initially, a key point is not just to copy-paste linear to circular, but to learn from linear and strive for a good efficiency-utility balance. Two aspects, or trade-offs, are critical to consider: standardization versus flexibility and integration versus separation.

The first key is to balance standardization and flexibility when configuring the nodes. Retailers must learn from linear retail and simplify and standardize circular operations as much as possible. This includes, for example, avoiding treating each used article as unique and instead implementing simple categorizations. Processes need to be simplified, streamlined and scalable. At the same time, there is a need to build in some degree of flexibility. This could be achieved by avoiding static configurations and instead adopting a modular approach (e.g. modular spaces and processes, agile governance and adaptable systems) that enables continuous reconfiguration. All circular logistics nodes need some degree of flexible and modular space to accommodate and sort fluctuating product types and volumes. They also need flexible resource allocation systems to match the operational workload. Retailers need to balance and consider trade-offs between standardization and flexibility (or being lean, agile or “leagile”). This is important, as retailers will potentially face multiple reconfigurations due to continuous changes in consumer preferences and the regulatory environment. The ability to adapt nodes to new laws and regulations could become a competitive advantage.

The second key is to consider integration versus separation. On the one hand, integrating circular services into existing (linear) nodes may reduce costs by sharing infrastructure and resources. On the other hand, separating circular services from linear nodes enables specialization but requires dedicated infrastructure and resources. Integration may also result in cannibalization (which some would argue is the point of the circular retail transformation, while others would disagree) in terms of space, resources and revenue. A key takeaway is that not all nodes are suitable for integrating circular and linear. In a long-term perspective of scaling up operations, not all circular services may be suitable for integrating with linear. It is therefore critical to define which operations should be performed by existing logistics nodes and which should be separated into other (new) nodes.

Finally, there is a need to adapt key performance indicators (KPIs) to track circular operations efficiency, environmental impact and work environment for each node. This includes integrating circularity metrics into reporting systems to support decision-making and long-term planning. Existing KPIs measure success differently and may counteract the circular logistics nodes, making retail management view them as unsuccessful. This implies the need to balance indicators to cover customer utility, logistic efficiency, environmental sustainability and employee well-being. It also calls for the establishment of consistent KPI frameworks across nodes while allowing flexibility for local adaptation.

The circular retail transformation comes with multiple new resource requirements. On a strategic level, the logistics organization must adapt to a new way of thinking, which includes understanding macro trends. Logistics managers must be forward-looking and understand the political decision-making process at local, regional, national and global levels. New regulations on national and supranational (e.g. European Union) levels may have concrete implications for how the circular logistics network and nodes are configured. Examples include the Right to Repair Directive, the Extended Producer Responsibility strategy and taxation on circular services. The organization must also develop a strategic understanding of who the consumers are and what their requirements entail for different types of nodes.

Another important aspect is adaptation and investments in technology. The logistics organization needs system support to handle dynamic inventory and continuous tracking at the item level. One example is digital product passports, which enable individual-level tracking. This example also highlights the importance of understanding both legislation (e.g. need to track) and technology development (e.g. tools for tracking). The organization also needs to invest in, implement and/or develop technologies to enhance operational efficiency and standardization, which ultimately promote profitability and scalability of operations. In parallel, there is a need for continuous development of new skills needed in different nodes. This requires the organization to (1) define the competencies and systems required by each node, (2) differentiate competencies and systems across nodes, (3) enable knowledge and resource sharing across nodes, (4) upskill employees through training programs to standardize ways of working, (5) develop guidelines and manuals to standardize ways of working and (6) align employee incentive structures to emphasize sustainability and circularity metrics.

In this section, we present a research agenda for circular logistics nodes (see Table 3) with several research avenues and potential theoretical and methodological approaches. The research agenda is based on the previously discussed themes and implications for the networks, nodes and resources.

The first theme recognizes that the political and market landscape of the circular economy is complex and dynamic. Retailers are motivated to integrate circular services due to regulatory pressures and/or market expansion opportunities. Consistent with Choi et al. (2001), the circular environment is dynamic and rugged. It is dynamic in the sense that it is constantly shaped by emerging and shifting policies and regulations (e.g. Extended Producer Responsibility, Ecodesign for Sustainable Products Regulation, Right to Repair). Within this landscape, regulations and policies change fast and actors must adjust to remain compliant and functional. These regulations also produce rugged landscapes (nonlinear and complex), and as some actors adjust to remain compliant, others might be affected. We propose studying this theme through two lenses: (1) complex adaptive systems (CAS) to explain the circular system and (2) dynamic capabilities to explain the firm's response within that system. First, CAS theory can support the understanding of the complex dynamics of circular systems: agents, schemata, fitness functions and resources (Dooley, 2022). From a CAS perspective, the dynamic environment reshapes agents' fitness and schemata in nonlinear ways. This helps explain why existing governance models often fail to align policy with organizational capabilities. Future research should therefore investigate governance models that integrate top-down policy goals with bottom-up industry capabilities to operationalize circular economy policies. Researchers could employ a qualitative multi-stakeholder interview study design, combining interviews with public and private actors to understand different perspectives and identify common ground for future policy development, and further extend research on inter-organizational collaboration and collaborative governance (e.g. Perotti et al., 2025; Schultz and Valentinov, 2026; Sinha et al., 2026). Second, dynamic capabilities theory can explain how retailers reconfigure and adapt to a changing external environment (Sandberg and Abrahamsson, 2011). This theoretical perspective can help understand how firms adapt retailers' capabilities and resources, creating, extending and modifying them over time (Helfat et al., 2007), and how circular retailers sense opportunities and threats, seize opportunities and transform (Teece, 2007). Future research could investigate retailers' adaptation mechanisms to address external pressures from circular economy regulations. Longitudinal process research (Langley, 1999) is a good methodological fit for studying configuration development over time as regulations have been or are implemented.

Along with the second theme, we analyzed how consumers assume a dual role as suppliers and buyers in circular retail. A thorough understanding of consumer preferences is essential to identify the requirements of circular logistics nodes and networks that effectively engage them. Recent research has examined consumers’ preferences for different textile collection models (Dukovska-Popovska et al., 2025) and highlighted the lack of integration with consumers (Pellegrino et al., 2026). However, future researchers could investigate which network configurations (decentralized nodes in polycentric ecosystems or centralized specialized nodes) support greater consumer participation in circular services and circular cities. Doing so can improve further understanding of which operations (sorting, reconditioning, reselling) for the different services (rental, repair, resale) are better centralized or decentralized to engage consumers. This theme could be studied through a socio-ecological-technical systems lens (see, e.g. Andersson et al., 2024), which holds that organizational outcomes are shaped by the interaction among technical, ecological, and social elements. Adopting this lens can advance explanations of how circular logistics nodes and consumer behavior complement one another in establishing consumer-centric circular systems. To capture the perspectives of both consumers and retailers, studies could employ mixed methods. For instance, using ethnographic methods, researchers can observe and immerse themselves in natural settings to understand consumer behavior (Watson, 2011, p. 206) or use field experiments to intervene and test consumers using circular services (Simester, 2017) to uncover consumer preferences. In parallel, the retailers’ perspective could be examined through multiple case studies, supplemented by simulations or modelling, to analyze different network configurations, the need for new circular logistics nodes and their impact on consumer participation.

In the third theme, we argued that supply in circular retail is decentralized and unpredictable in terms of volume, quality and timing, complicating logistics for handling product flows. At times, some nodes might be overutilized while others are underutilized. This complexity requires flexibility and modularity to rapidly increase and decrease handling capacity or implement configurations that enable flows between nodes to balance capacities in the network. These challenges point to the importance of information sharing, tracking and modularity as strategies to support circular flows with unpredictable capacity needs. Future research could examine network configurations better suited to handle this unpredictability, as well as strategies to embed flexibility into node configurations. Design theories, such as process modularity theory, build on the application of modular design to organizational processes (Schilling and Steensma, 2001), where the idea is to create a modular architecture, interfaces, and standards with predesigned process modules that can be activated, deactivated, decoupled or resequenced (Saïah et al., 2023). Methods such as simulation modelling (Dooley, 2017) could be valuable for testing modular configurations using historical supply-and-demand data. Design science research (Romme and Dimov, 2021) would be valuable for exploring this topic, as it enables the analysis of existing configurations and experimentation with alternative designs in controlled environments.

The fourth theme elaborated on how governance and organizational structure drive circular retail implementation, including levels of control and decision-making autonomy. Building on these insights, we hypothesize that circular logistics nodes require agile decision-making to address supply unpredictability and adapt the service to different market preferences. It would be worth investigating the level of decision autonomy (e.g. in operations, partners and service design) and the decision-making structures required to support circular services, and how these can alter power relationships in established networks. Future research could examine the emergence and evolution of such governance structures in circular settings, as traditional governance structures may be disrupted or pose challenges to the implementation and operation of circular services. For instance, many circular services originate at the community or store level and rely on ad hoc, informal decision-making. As these initiatives expand and integrate into established operations, they require coordination and formal governance mechanisms. This process of formalization modifies the network's power relations. Formalization can therefore enhance coordination and scalability, but could, in turn, reduce the level of autonomy required for adaptation to local communities. A theoretical lens such as network governance (Jones et al., 1997) can help explain how power dynamics, authority, coordination and accountability are distributed across circular ecosystems and logistics networks. Researchers could then analyze how power relations and decision-making are reallocated as retailers scale their circular services and embed them into established networks. A longitudinal process study design (Langley, 1999) could be used to capture how and why different governance structures unfold, change and evolve over time. Researchers could then trace back and, in the future, examine how ad hoc decision-making and firefighting become formalized, the shift in authority between actors, and the trade-offs between autonomy and coordination when the service matures.

The fifth theme concerned the integration and scaling of circular operations. We explained that when implementing circular services, retailers must decide whether to integrate them into existing logistics nodes or keep them separate, while considering future scalability. This decision has direct implications for the node's configuration, and not all nodes are suitable for integration or separation. Future research could therefore examine how different circular operations (e.g. collection, inspection, sorting, repair, resale) can be configured when integrated into existing logistics nodes, and which mechanisms (e.g. outsourcing, standardization or separation) are more appropriate when integration is not feasible. Transvection theory (e.g. Alderson and Martin, 1965) provides a useful lens to analyze how circular operations are configured and scaled within retail networks. This theory has been extended by Kembro et al. (2022) to explain sorting in retail logistics. Using transvection could support the analysis of circular logistics as a series of transformations (e.g. collection, inspection, sorting, resale, repair) that can be performed by different actors at different logistics nodes, affecting system performance. Interdependence theory can further support this analysis by showing how configurations depend on interdependence patterns (Thompson, 1967). The theory can be used to understand how different types of interdependence (pooled, serial or reciprocal) require different coordination mechanisms for information sharing with upstream (e.g. external partners, manufacturers) and downstream actors (e.g. consumers), as well as node configuration, governance or organizational structure. Design science research is suited to this area, as it enables the development and testing of practical solutions with retailers (Romme and Dimov, 2021).

Theme six focused on the resources required to deliver circular services, highlighting the importance of technology and skills. Prior research has begun to explore employees' skills for circular business models (Straub et al., 2023), but our literature review highlighted limited knowledge about the specific capabilities and technologies (e.g. use of automation technology for circular sorting) needed to implement and scale circular services in retail contexts. This gap is critical, as resource development impacts the capacity and operational efficiency of circular logistics nodes. Future research could build on these learnings to explore the skills, competencies, tools and technologies required for circular operations in retail contexts, and examine how retailers can leverage and adapt existing resources within their nodes, such as by upskilling staff, creating new roles and using existing warehouse management systems, pricing tools or digital product passports (Acciai and Pérez-Bou, 2025). Such approaches can simplify processes, improve integration, increase processing capacity and offload resources from handling complex operations. Dynamic capabilities theory provides a useful lens for exploring how retailers develop, adapt and reconfigure resources to support circular services (Teece, 2007). Methodologically, action research is suitable as it enables the researcher to actively participate and observe resource development and capability building. Using this approach, researchers could experiment with new roles, skills and technologies in practical operational settings (see Näslund et al., 2010).

Lastly, theme seven addressed the limitations of traditional performance indicators and incentive systems in the context of circular retail, and the need to integrate sustainability and circularity metrics to further develop circular services. The literature indicates that there is currently a research gap in the design of performance indicators to evaluate and monitor circular services (Bernon et al., 2018; Sinha et al., 2026). Future research could focus on identifying performance indicators and reward systems that best support the implementation and operation of circular services in logistics nodes. Researchers could employ contingency theory (Donaldson, 2001) to ground the study on the premise that organizational control and performance measurement systems should be aligned with operational context and configurational aspects. Applying this perspective could suggest differentiating indicators between service type, circular logistics nodes, their operations and resources. Design science research is an appropriate method to address this research question. It enables the development of artifacts, such as KPI frameworks or scorecards, to measure circular service performance in collaboration with retailers. Its iterative design and testing can help assess the different design propositions.

Across the different themes, several tensions were identified, including supplier versus buyer roles, centralization versus decentralization, operational efficiency versus flexibility, separation versus integration and logistics efficiency versus customer utility. These tensions can be conceptualized as paradoxical demands in circular logistics networks, as competing and interdependent elements must be addressed simultaneously rather than resolved. This perspective opens opportunities for future research to investigate the tensions that arise, how they manifest in the node and network, and how organizations negotiate such paradoxes when integrating circular services. Paradox theory (Smith and Lewis, 2011) can provide a lens to analyze how actors respond to tensions and how these responses influence the configuration of circular logistics systems.

The purpose of this study was to expand our theoretical understanding of the circular retail transformation and its implications for circular logistics nodes. Through an integrative literature review, we bridged insights from fragmented literature across domains (e.g. sustainability, marketing, logistics, supply chain management) to understand the transformations logistics nodes undergo when integrating circular services (e.g. rental, repair, resale). Our review addressed the purpose by highlighting (1) seven themes that outline the circular retail transformation, (2) implications for retail stores as a circular logistics node, (3) implications for the configuration of circular logistics nodes and (4) proposing a future research agenda.

Our study makes several theoretical contributions. First, we conceptualized retail stores as circular logistics nodes taking on a range of roles such as collection center (Dukovska-Popovska et al., 2025; Das and Chowdhury, 2012; Savaskan and Van Wassenhove, 2006), refurbish center (Timoumi et al., 2021; Mont et al., 2006), gatekeeping, sorting and grading point (Wilson and Goffnett, 2022; Miao et al., 2017), testing nodes for circular services (Bocken and Konietzko, 2022) or offering resale (Beh et al., 2016). Second, our integrative review explored what it means for retail stores to function as circular logistics nodes by identifying and discussing seven themes that shape the transformation: (1) incentives and regulatory enablers for integrating circular services, (2) introducing the circular consumer, (3) the issue of supply, (4) circular governance and organization, (5) integrating and scaling circular services and operations, (6) leveraging resources to take on circular services and (7) new performance indicators for circular services.

Third, our study extended the review insights to implications for a broad range of nodes in a circular logistics network. These implications were clustered into three interdependent configurations: (1) the circular logistics network, (2) the circular logistics node and (3) resource development. The insights are generalizable to physical logistics nodes transitioning from linear to circular retail. These nodes operate within systems that require coordination across actors and product flows (e.g. logistics networks). They deal with integrating roles, responsibilities, operations and resource allocation. The transferability of the findings may be more limited for pure digital platforms, stand-alone nodes or nodes that break down or remanufacture items to recover raw materials. Fourth, by connecting all insights from our study, we developed an agenda for future research that links themes, implications, potential methodological approaches and theoretical perspectives. The reviewed body of literature revealed a concentration in specific retail sectors and practices. Sectors such as fashion and electronics were well represented in the literature due to product lifecycles, policies and market opportunities. This distribution may limit the generalizability of the findings to other retail contexts. Future studies are therefore encouraged to build on this work by extending its scope. This includes contrasting differences across cultural contexts and markets where services such as reuse, repair and rental are consumed differently. It is also relevant to extend our research beyond the commonly studied sectors of fashion and electronics.

Finally, to guide practitioners on the circular journey, our study offers a structured overview and understanding of the circular retail transformation. We highlight aspects to consider when (re)configuring retail stores and other logistics nodes in this new context. The insights and implications for the circular logistics nodes can serve as a roadmap for implementing various circular services and guide practitioners' discussions within their organization and support their planning and innovation efforts in circular retail logistics. Our research emphasizes that circular logistics requires systemic transformation, characterized by new services and actors, redefinition of roles for logistics nodes and a range of new configuration decisions. This suggests that using linear stores and other logistics nodes for circular retail is not a straightforward path. While we can learn a lot from past decades of improving logistics for linear consumption, it is not simply a copy-and-paste. Another implication is that circular retail constitutes a complex and dynamic system of interdependent actors and partnerships, including consumers, manufacturers, technology providers and third-party logistics providers (3PLs). This system creates greater demands on coordination, cooperation and information sharing among the actors involved. Technologies such as automated material handling for sorting and quality assessment appear to be crucial to scale circular flows in the long term. At the same time, it is unclear when such technology will be mature enough for broad implementation and at what cost. Our findings highlight that such technological solutions must be developed in conjunction with organizational changes, skill and competency development and new business models.

To reflect on the managerial relevance of our findings, we held ongoing discussions with our panel of experts: retailers, sustainability organizations, and technology and service providers, about the identified themes and their implications for retail stores and circular logistics nodes. They confirmed that the transition from linear to circular retail requires reconfiguring logistics nodes, their operations, and design and resources. They highlighted how different products, regulations and consumer characteristics accelerate or hinder the integration of services within existing nodes. At the same time, they emphasized the challenges of coordinating linear and circular operations within and between nodes in their logistics networks, the importance of making circular services profitable for scaling and the need for technology to enhance node capabilities. All of which reinforces the practical relevance of our study.

Database: Scopus.

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Editions included.

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- Social Sciences Citation Index

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Editions excluded.

- Conference Proceedings Citation Index-Science (CPCI-S)-1990-present

- Arts and Humanities Citation Index (AHCI)-1975-present

- Conference Proceedings Citation Index-Social Science and Humanities (CPCI-SSH)-1990-present

Research on sustainable retail has been published in many outlets and disciplines such as marketing, retailing, business strategy, circular economy, operations, or logistics and supply chain management. As this study deals with the intersection between circular economy, marketing, and logistics and supply chain management, the publications are distributed in multiple journals covering diverse research areas. The database of selected publications encompasses a total of 45 different journals (Table A3).

As of March 2026, when this review was conducted, we observed a spike in the number of publications in recent years, reaching 18 in 2025 (Figure A1).

Regarding research methods, the most used approaches are interview study (22), case study (18) and mathematical modeling (17). For a full split, please see Table A4 

From the review, we concluded that circular economy research is at an early stage of theoretical consolidation. Especially when it comes to applying mid-range or grand theories, where only 21 articles explicitly mentioned the use of theories. The most used is the resource-based view theory (6) and dynamic capabilities (4). For a full split, please see Table A5.