Repair and Re-manufacturing are Driving New Growth Opportunities in the Global Electrical and Electronic Equipment Recycling Market

International Repair Day – 21st Oct 2023

The third Saturday of October every year is recognized as International Repair Day and leading up to International Repair Day Oct 21st, 2023, themed Repair for Everyone, – I would like to share a few insights from our current research on the topic of Growth Opportunities for Sustainability and Circular Economy in the Global Electrical and Electronic Equipment (EEE) Reuse, Repair, and Recycling Market. The speed of technological innovation coupled with shortened lifecycles of EEE is driving an exponential increase in e-waste volumes, depletion of finite natural resources, and increase in carbon emissions as well as serious environmental and health risks. In 2022 the total global e-waste generation is estimated to be around 59.4 million metric tons and is expected to reach 74.7 million metric tons in 2030. Progressing e-waste generation is a global issue with everyone being involved, starting from the manufacturers to the consumers, and the end-of-life management specialists. We are all involved to deal with the problem as well as contribute and benefit in the process. The good news is that we, as the consumers, have started to understand that the unused equipment that we own has value and there are an increasing number of start-ups with platform business models that offer secure and sustainable solutions to extend the lifecycle of our equipment, maximize its value recovery, and minimize waste generation. Are we ready to turn the challenges into opportunities that will benefit us all?

According to Frost & Sullivan’s 6P framework for Sustainability and Circular Economy, a successful businesses approach should focus on six core pillars of the Environmental, Social, and Governance (ESG) factors: Policies, Processes, People, Products, Partnerships, and Platforms. Effective synergies across these core pillars create growth opportunities and the development of new business models while ensuring companies meet the ESG standards consistent with a “good for people, good for the planet, good for business” approach.

As part of our current research, I have recently met with three leading experts involved in the Circular Economy of EEE - Eric Ingebretsen, Chief Commercial Officer at TES; Fredrik Forslund, Vice President and General Manager at Blancco; and Paul Anton Ploberger, Public Affairs Manager at refurbed, to discuss the key challenges and opportunities that will influence the future path for Circular Economy of EEE forward, the rising trend of repair, remanufacturing/refurbishment and reuse as well as the critical aspect of data security in today’s world.

TES is the leading end-to-end IT asset disposition and e-waste recycling partner with a global range, enabling companies to responsibly and securely manage their EEE. The company fully covers services in the scope of transportation, in-house inventory, data sanitation, reuse and repurpose, recycling, and reporting with the ability to effectively process all types of technology assets. The EEE devices are individually inspected to facilitate maximum value and resource recovery. These include refurbishment and resale, part harvesting, or in-plant materials recycling with the reuse rate reaching 98%.

Blancco is a global software company that ensures secure and sustainable data erasure from a wide array of IT assets with its software-as-a-service (SaaS) solution. The key customers include IT Asset Disposition (ITAD) companies, recyclers, system integrators of IT infrastructure, resale partners, and OEMs. Over the years the company has successfully sanitized more than half a billion devices, performing an average of 70,000 data erasures daily, that are verified by audit trails as well as the external government certificates.

refurbed is the fastest-growing online marketplace for multi-category refurbished electronics in the German-speaking region. The company operates an e-commerce platform through which it sells fully renewed electronics, especially mobile phones, laptops, and tablets. Products sold via refurbed’s marketplace come with at least 12 months of warranty, are up to 40% cheaper when compared to a new one, and support sustainable purchase decisions of the customers.

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Here are the key takeaways from the discussions.

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Regulatory changes are projected to drive much-needed growth of the e-waste recovery and recycling infrastructure globally.

According to Eric Ingebretsen from TES, we're headed for an inflection point across the e-waste management market that is expected to come in the next couple of years, due to the new regulations. The upcoming regulation called the Ghana-Switzerland proposal is seen as a catalyst for that change, establishing new definitions and restrictions on the transboundary movement of materials. The implementation date for these changes is 2025, having a significant impact on the market as in many countries this will mean a lot less material will get exported and thus have to be processed in-country. This could drive growth in e-waste recovery and recycling infrastructure in countries with limited material processing capacity. In addition, as consumers are demanding higher transparency and responsibility of manufacturing and end-of-life management, the Digital Product Passport (DPP), proposed by the EU Commission, is seen as a breakthrough solution to address major challenges faced by the electronic industry with the practical implementation of circularity approach through comprehensive access to the product-related data and its lifecycle. Batteries are projected to be the first product category required to comply with DPP, starting from 2026, with consumer electronics and apparel following shortly after. Until 2030 the DPP will be required for approximately 30 product categories in total.

Paul Anton Ploberger from refurbed has no doubts that we are ahead of the major systemic changes: “Considering the way that our economy works right now, our system of production and consumption, there is just no way we can keep this up for the years to come. We must change this to a circular loop”.

Development of the Repair Economy is expected to bring maximum value recovery and support the development of re-commerce market.

“The best form of recycling is reuse,” says Eric Ingebretsen, and TES’ approach is to find a second life for IT assets, whether it is for refurbished equipment, components, or individual materials. According to Eric Ingebretsen, the demand for refurbishment services of EEE will witness a growth momentum over the next five years, fuelled by proposed regulations, like the Right to Repair in the EU supporting the right for consumers to claim repair to producers, as well as the OEMs incorporating closed-loop strategies at the design stage and take-back programs and the end of life, but moreover, the secondary market offering more access to spare parts. TES has strong expertise in refurbishment and repair services dedicated to retired IT assets, data center equipment, and spare parts, that guarantee maximum value recovery before de-manufacturing and recycling. The refurbished products are then returned to the market and redistributed via retail and trade platforms.?In fact, the development of the re-commerce market is supporting sustainable purchase decisions to extract value from pre-owned products and goods, in a much more structured and safe way. According to Fredrik Forslund from Blancco, the demand for second-life equipment is high for all IT asset categories: “There is a strong and underlying trend in the market to work more actively with the reused assets. We see it on the mobile phones side, it is a mature market on the laptops and desktops side, and we see it on the server and the storage side growing and becoming more significant”. Therefore, the electronic equipment repair market is witnessing a strong trend with double-digit growth.

At present majority of the refurbished equipment available in the second-hand markets comes from the take-back programs dedicated to businesses and OEMs. However, there are still, mostly unexplored, opportunities dedicated to unused equipment of individual users. “The European Commission says there are about 700 million unused phones somewhere in the drawers of people around Europe. That is just so much potential” says Paul Anton Ploberger from refurbed. We can expect the transition happening and companies like Refurbed are there to close the loop for the individual users as well. “We know that there is so much potential to do something good and bring those phones back into the loop to give them a second life,” says Paul Anton Ploberger.

Safety and secure data destruction at the forefront of the Circular Economy of EEE

Today the number one concern related to the Circular Economy of EEE is data safety. “We know that this is a great concern for a lot of customers, they are not sure what happens to the data if they trade in their old device. And so, this is something that is critical in the refurbishment process” says Paul Anton Ploberger from refurbed. Eric Ingebretsen and Fredrik Forslund both agree that safe data destruction enables the efficiency of the Circular Economy of EEE forward. “What is holding people back is the fear of losing control of their data. But if we can continue spreading the awareness that data sanitization is a mature technology today and that we have hundreds of millions of devices being securely processed without any risk of data leaks, that will help release more equipment into the second-hand economy for sure” says Fredrik Forslund from Blancco. TES is using highly accredited Blancco data sanitization software solutions to develop data protection and secure chain of custody protocols to limit ‘data in the wild’ that could present significant risks to its customers. Within Blancco’s solution, the company can execute a triple-pass data overwrite and certify full data destruction enabling it to process IT assets safely and re-introduce it back to the market.

?TES, Blancco, and refurbed feature in the upcoming Frost & Sullivan’s market research on the Growth Opportunities for Sustainability and Circular Economy in the Global Electrical and Electronic Equipment (EEE) Reuse, Repair, and Recycling Market that indicates Companies to Watch – the Growth Accelerators of Circular Economy of EEE. The report will also provide a growth opportunity analysis along with sustainable business development for all the stakeholders involved in the EEE value chain.