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6.4.1. How is a Recycling Strategy formed?

How a Recycling Strategy is formed?
Recycling might be used for many products or by-products as well as from many different sectors. In addition there are many technologies available for recycling purposes as well as expert consultants in several recycling areas. According to the above context, the following paragraphs provide a general framework of actions and major issues for any company interested in recycling. 


Basic questions
The following exploratory framework provides a good starting point before any business decision is made for recycling. The aim is to investigate the financial feasibility of recycling and to explore in this preliminary stage if and how the recycling team should continue:

Draw up a profile of the product’s current end-of-life system
Who owns the product?
What kind of ownership is involved?
What is the price?
How big is the product?
What is the average life of the product?
What is the weight of the product?

Analyze the main reasons why users dispose of the product
Is the product disposed of because of technical failure?
Is the product sensitive to trends?
Are there new products on the market, which offer more features?

Determine what legislation and regulations affect the end-of-life system
To what extent is the manufacturer responsible for the end-of-life phase?
Does a take-back obligation already exist for discarded products?
How can the costs of returning an processing the product be financed?
What rules and prices apply with regard to product reuse, material recycling, incineration and dumpin of residual wastes?

Contact the suppliers
Due to specialised expertise, suppliers can usually achieve sub-assembly reuse, recycling more efficiently than the OEM (Original Equipment Manufacturer)

Establish how the product can be collected (possible ways)
Consumer return system via recycling center
Pick-up from last user
Return system via retailers

Determine who is going to recycle or process the product
Should the product be processed in house?
Should a third party process the product?

Select the most efficient end-of-life system
Use the answers to the preceding to establish an end-of-life scenario
Due to the uncertain nature, consider establishing several scenarios

Some trends to keep in mind:
Users will think twice before discarding products
Governments will develop more regulations
The processing industry will become more effective
Technological options will be expanded, especially in mechanical waste processing
Market for recycled materials will improve
Incineration and burial of waste will be subjected to more regulations and become more expensive
 
Basic Cost Factors in Recycling
The basic idea in recycling is that we want to make recycling profitable: Profit = Revenue – Cost
 
Revenues are obtained from:
  • High value (high demand), undamaged recovered reusable components.
  • Additional processing (cleaning, inspection, upgrading, reassembly, and redistribution) adds to costs.
  • High value, uncontaminated scrap materials.
  • Any contamination, which reduces material properties depreciates the material value.
  • Energy recovered and sold from incineration or pyrolysis.
  • Lowest revenue of all.
 
Common Cost Factors
  • Buy back of product (€/product)
  • Dependent on condition and value of product type.
  • Transportation costs (€/km)
  • May also be dependent on weight and damage tolerated.
  • Tip/storage fees (€/product), also for land filled residue.
  • Strongly influenced by location of facility and local legislation.
  • Labour cost (€/hour)
  • Dependent on level of skills required and location.
  • Equipment investment cost (€)
  • Influenced by need for special (expensive) equipment.
  • Equipment operating cost (€/car, €/hr)
  • Time necessary to recover parts and materials (hr/product). This cost factor is strongly influenced by product design.

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