Beyond Shredding

07.05.2018

How a ‘circular economy’ is already transforming consumer electronics
LISA JOHNSTON

Reduce, reuse, recycle: One company is providing a way for consumer electronics companies to plot a healthier path for device manufacturing, from early design to end of life and every step in between.

Re-Teck, a subsidiary of Li Tong Group, engages and facilitates the post-consumer recycling and recovery of CE devices. It not only works with tech retailers to manage their upgrade and takeback programs, but also provides solutions for various stages of electronics lifecycles.

TWICE recently spoke with Linda Li, Re-Teck chief strategy officer, to learn about the company’s processes, including some misconceptions about reverse supply-chain management.

For one thing, the traditional approach to recycling devices — of just shredding everything to obtain a few commodities — is the very last thing that Re-Teck does, Li said. Instead, the companies’ engineers focus on trying to give components a second life.

“If you’re just merely getting some gold or other type of precious metals out of electronic devices, it could only be a couple dollars’ worth, and the amount of carbon footprint that is gone forever once you shred is enormous,” said Li. “Whereas if you’re able to harvest and repurpose a display module, a memory chip or a camera and give it a second life so that it can be used in something else, the financial-value recovery is 10 times [greater], and the amount of carbon footprint savings and [reduced] environmental impact is much bigger.”

The process is different for each OEM, she said. Some employ Re-Teck for what’s known as closed-loop recovery, in which components harvested from a consumer’s returned device are remanufactured, restored to original functionality, and then redeployed to the OEM’s original supply chain.

Other companies choose closed-loop rebirth, in which key raw materials, such as cobalt from batteries, are harvested for use in future devices. Li noted that this process also enables more efficient device recycling.

See: ‘Right To Repair’ Bill Introduced In California

“The plastic [in CE devices] isn’t generic plastic,” she explained. It contains such elements as magnesium, and if these plastics end up in a generic plastic recycler, they’re unable to break down.

Just as recently as five years ago, recovery or recycling remained an afterthought for most OEMs, she said. “They were rushing to get products out there and worrying about environmental response later.”

And when that response did come, said Li, it was a traditional electronics-recycling method of collecting a lot of devices, allowing them to stay put, and then attempting to auction them to a scrap dealer. This method is problematic in that the value of the materials and components diminish during the holding period, and the materials end up becoming a liability to OEMs.

Linda Li

Linda Li

Re-Teck’s services, whether through recycling or retail takeback programs, are instead promoted as the veins and arteries of consumer electronics: “Both have to flow continuously for a body to function healthfully instead of letting things accumulate.”

Now, said Li, there’s very little convincing that needs to be done. “OEMs realize that having their own veins — their own solution — is a critical weapon for selling new products.” This is particularly the case for companies that launch a new flagship each year; not all consumers are motivated to upgrade annually, and so manufacturers are able to stage trade or takeback programs to not only minimize environmental impact but secure consumer loyalty as well.

It also reduces that liability impact. “OEMs also realize that if [device recycling] is handled wrongly, the damage could be huge. If something ends in a landfill, or data is leaked because it’s sold on a gray market, it could potentially damage the brand.”

More OEMs have enabled a commitment to this “circular economy,” said Li. While western retailers are already accustomed to shouldering some of the social and environmental burden of CE recycling, it’s just beginning to catch up in Asia, she said.

Re-Teck now works closely with CE design engineers, consulting with the OEM during Re-Teck’s de-manufacturing process. As part of this, Re-Teck engineers painstakingly take apart CE devices and provide feedback on potential future recycling hindrances. For example, a device using very strong industrial adhesives in which everything is glued shut makes it impossible to take it apart, so it decreases the reusability of the key components, said Li.

OLED is another example of a potential roadblock because of its fragility. “If something goes wrong, the whole module is going to waste,” she noted.

To help with this, Re-Teck’s engineers designed their own proprietary tools and fixtures for taking OLED devices apart. This allows them to rework the display and give it a second life, eliminating the need to toss the entire panel in the recycling bin if it suffers a crack.

It’s these small but monumentally impactful actions that Li said make her happy to get up for work in the morning. “Even if we change one very small thing, it has the potential to change for a million devices. It makes a real difference in the world. And it sounds very cliché, but it’s a fact.”

See: How Retailers Can Be King Of The Road

Li, an engineer who said she’s always had a passion for technology, began her career working in supply-chain strategy. After moving to Hong Kong to manage the portfolio of a private-equity firm, she realized she “was on the wrong side.”

“I was only worried about making money for the people who have a lot of money. I wasn’t making a difference,” she recounted.

She met Re-Teck founder Tony Wang in 2010 and was intrigued and inspired by what he was doing in the field of device recycling. She joined the company, which was essentially operating as a 10-year-old start-up, to help Wang bring it to the next level.

“Every entrepreneur goes through a bottleneck,” said Li, “and I saw this was a place I could become useful.”

Re-Teck had just a few factories in China when Li joined eight years ago, and now it operates more than 20 facilities in North America, Europe, Asia, Latin America and the Middle East. Its U.S. operations are headquartered in Redwood City, Calif.

“Everything is wholly owned, which is very [intensive] because you have to do everything from scratch to ensure the quality and standards for environmental health, privacy and safety,” said Li.

This is not to say that the growth has been (or remains) easy. Li spoke a bit ruefully as she described some of her responsibilities, including getting both operations and compliance employees on the same page during device development. Needless to say, it’s not always a simple task as both teams face their own heated priorities.

As part of its growth path, Re-Teck has planned investments in the U.S. The company anticipates the “heart” of the supply chain (remember that veins/arteries metaphor) moving to these shores.

This shift will have an exciting effect on retail, said Li, as it provides additional opportunities and solutions within the reserve supply-chain ecosystem.

“We understand the U.S. is still more post-consumer retail driven when it comes to end-of-life products,” she said. “A big focus of our business in the U.S. is going to be the retail and e-commerce network.”

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