Purpose: This study aims to explore the evolution mechanism of business model in the circulation industry, which is conducive to the comprehensive analysis of business model function and dynamic understanding of inherent logic of enterprise value creation. Research design, data, and methodology: By using POAA value creation analysis framework, adopting the design of longitudinal case study, this study analyze the evolution process of business model of Zhejiang Materials which is one of the World’s top 500 enterprise. Results: The evolution of business model can be represented in terms of time series and propelled by both external factors and internal factors. In different stages, the changes of core elements are dynamically consistent with the constitutive dimensions of business model. Both of them are beneficial to maintain enterprise’s competitive edge. Conclusions: Regarding value proposition, there is the transition from economy value to ability value and finally to relationship value; in value operation, the form of organization evolves from modular organization, to modular cluster and finally to no-boundary firm; as to value appropriation and acquisition, there is the evolution from internal systems integration to external systems integration within the industry, and finally to the internal system integration outside the industry.