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Economies of scale

On December 1 it will be 100 days since the Waste Electrical Electronic Equipment (WEEE) Directive should have been transposed into UK law. But still we wait. The last of three Government consultations went out at the end of July with a deadline of October 29.

Despite the controversy surrounding the directive, not least with questions over the legality of a national clearing house, one thing is certain the onus is on producers to provide for the recovery and reuse of separately collected WEEE. But what does this cradle-to-grave duty mean to manufacturers and how much will it cost?

One thing has become patently obvious, however, and that is that impending legislation has brought out the best and worst in companies. While some businesses are taking a wait-and-see approach, others have pulled out all stops and have gone so far as to strip products back to the design concept, taking into account ease of dismantling and disposal when redeveloping products. In addition, many are making sure component suppliers reduce the number of parts in their product to simplify product disassembly and to inform recyclers of the types and location of any hazardous substances.

Whichever approach has been taken up until now, stark differences are soon to manifest themselves between those who have taken a proactive stance and those who have waited for developments, as there is now a commercial necessity for manufacturers to incorporate end-of-life strategy into each area of the planning process, says Graham Margetson, director of Foresite Systems, a solutions provider for electronic and packaging regulations.

On first inspection, it appears that this commercial necessity requires major investment in terms of research and development from product design and manufacturing, sales and marketing, servicing and decommissioning with little return. It is all very well being legislatively compliant but will the costs associated with WEEE implementation send smaller manufacturers out of business? he asks.

Margetson believes that planned strategically, operating a WEEE-compliant business does not have to create a dent in the bottom line. Quite the reverse, in fact. Margetson says that managed thoughtfully it can lead to increased revenue, margin and customer satisfaction.



Business

To take advantage of the pragmatic commercial opportunities that effectively managing WEEE can represent, businesses must look at one or more of the five product recycling Rs: reuse, reclaim, refurbish, remanufacture and revenue, Margetson says. Although not all will be applicable to all companies as each does have its disadvantages most businesses will be able to springboard their solutions from one or more of these.

Reusing or refurbishing and reusing components for alternative purposes, such as for other products or for spares support, is an effective strategy to implement. However, Margetson says this particular strategy needs careful thought as the initial immediate return on investment may become counterproductive if it decreases new product sales. Reclaiming the inherent value of component materials is an alternative option.

More ambitious perhaps is remanufacture, he adds. To gain maximum value for a product, remanufacture sees products being upgraded and sold again as new. Again, this has a sting in the tail if extensive reworking is required to make the goods resaleable, the cost may outweigh the potential revenue gain and reclamation may be a better option.

All this brings us to revenue. Closely linked to remanufacture, there is intrinsic value in most WEEE and the more ambitious companies will look for this. Working out the best option or combination of options will have implications for the entire supply chain, but Margetson says that short-term implementation and operational set-up costs could result in long-term gain.

All this takes for granted the fact that a company has chosen to assume responsibility for its own end-of-life products, Margets

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