Johannes V. Gloria
This study develops a process-based engineering framework for evaluating circular manufacturing performance in micro, small, and medium enterprises (MSMEs). The framework was applied to 100 manufacturing firms in the Caraga Administrative Region, Philippines, using matched survey responses and twelve months of production, energy, and waste-management records. Circular Process Performance (CPP) was modeled as a formative construct comprising material flow efficiency, inverse specific energy consumption, waste recovery rate, and process efficiency. Partial least squares structural equation modeling was used to examine the associations among Sustainable Entrepreneurial Orientation, Resource Bricolage, Circular Business Model Innovation, CPP, and Sustainable Performance. Circular Business Model Innovation was positively associated with CPP (β = 0.466, p < 0.001), while CPP was positively associated with Sustainable Performance (β = 0.473, p < 0.001). In the formative assessment, process efficiency showed the most stable contribution to CPP, with a significant outer weight, high loading, and acceptable collinearity. Inverse specific energy consumption also had a significant outer weight; however, its elevated VIF and negative loading indicated collinearity-related instability and required cautious interpretation. Material flow efficiency and waste recovery rate remained theoretically relevant complementary dimensions of CPP. The framework provides a practical basis for linking circular business-model innovation with measurable production, energy, waste, and yield conditions in resource-constrained manufacturing MSMEs.