The Economics of Recycling and Remanufacturing · The Economics of Recycling and Remanufacturing Edgardo N. Bolinao Business Management Department, De La Sulle University-Manila BACKGROUND

The Economics of Recycling and Remanufacturing

Edgardo N. Bolinao Business Management Department, De La Sulle University-Manila

BACKGROUND OF THE STUDY Scarcity is the basis of our current way of life and why

capitalism is arguably the most efficient way to allocate resources. At the most basic level, the field of economics is predicated on the principle of scarcity. With the Earth's limited resources, everyone must make the best use of what he has, the basic tenet of the Japanese efficient allocation of scarce resources-people, time, money (NPV, IRR), etc. The good news is that there is something that every individual can do to help "re-purpose" the resources, and that is: RECYCLE!

The recycling of automobiles and automotive parts in North America represents one of the most successful examples of materials recovery. This activity is sustained by a large industry constituted by several groups, namely consumers, dismantlers, remanufacturers, transportation companies, materials recycling companies, metal recovery enterprises, landfills, and to a certain extent, the automobile manufacturers. Another industry that joined the recyclers' world is the used computers (laptap, hard drivers,

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24 THE ECONOMICS OF RECYCLING AND REMANUFACTURING

printers, ribbons/ cartridges, etc). These pieces of equipment are sorted for resale or material recovery. Revenue is recorded for resold equipment and unsold equipment is dismantled, with materials sorted into different scrap material categories. The scrapped materials are then sold and/or given to recyclers for further processing.

In the U.S., it is estimated that approximately 94 percent of the vehicles being retired are processed by the recycling industry. The fundamental of this industry is that it works purely on the basis of economics. It is argued that the success of the industry is based on the structure of the system: parties taking profit maximizing decisions are able to efficiently deal with the recycling of cars. However, the historic trends of reducing the vehicles weight and increasing the non-metal composition of cars pose serious doubts on the industry's future viability. A significant portion of the economic benefits associated with automobile recycling comes from the recovery of metal materials and parts. In addition, most of the non-metals represent a double cost to the industry; they have to be processed thereby increasing the transportation and operations costs, and at the end, are sent to landfills at an additional cost.

Automobile manufacturers are concerned about these risks because they behave that they have a major impact in the recyclability of automobiles; they determine weight and composition as well as the level of design for disassembly (DFD) in vehicles. Today a lot of companies like Xerox, British Telecom, Eletrolux or Duport de Neumour have integrated the parameter "recycling" from the design of their product to the end of its life. This concept of design method is called design for recycling or design environment. This method aims to include some parameters in the design in order to recover the product at its end of life. From this this new life cycle, assuming one can define several levels, the environment has an important bearing on the product itself.

• Design: A well-designed product is not only a product that meets the customer's needs. At the same time, it is an environment-friendly product designed to be reused.

• Manufacturing: Reduce the energy consumption and the waste from the manufacturing operations (oil, metal cuttings, toxic fumes, etc.).

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• During the product life: Limit and recycle the worn-out parts. Taking a car for example, that means oil, tires, batteries, etc.

• At end of life: Try to give second life to the product by remanufacturing or reconditioning process. Nevertheless, if there are no alternatives, recycle it after shredding and sorting the raw materials like steel, copper, plastic, glass, etc.

For a long time a lot of companies have understood the importance of the relationships between the environment and their products that is why more and more companies work through projects with laboratories specialized in this area. On the other hand, the different governments with specific legislation, sustain this global policy to preserve the environment. A good example is the "Blue Angel" legislation in Germany.

There are several differences between the recycling process and the remanufacturing process. The remanufacturing process involves reasonably large quantities of similar products which are brought into a central facility and disassembled. Parts from a specific product are not kept with that product; instead they are collected by part type, cleaned, inspected for possible repair and reuse. Remanufactured products are reassembled, usually on an assembly line basis using those recovered parts and new parts where necessary. Remanufacturing involves rather high volume factory arrangement similar to new product manufacturing except that parts flowing to assembly lines are mostly reconditioned parts. In other words, remanufacturing process includes the recycling of its components. When finished, a remanufactured unit should function as well as a new unit and provide similar service or longer. Each remanufactured product is tested and analyzed according to the manufacturer's original specifications on quality control and testing like an original product. The remanufacturers usually have an extensive core acquisition program which provides a customer with a remanufactured product from the extensive inventory on an

· exchange basis. The automobile after market, where engines, alternators, starters, transmissions, clutches are remanufactured, is an example of remanufacturing process. Suffice it to say that remanufacturing is the ultimate form of recycling.

The recycling processes on the other hand, instead of reusing the old parts, reprocesses them directly after disassembly and, cleaning of the product to do new raw materials and afterwards



rebuilding a new product. Consequently, the products issued from the recycling process are always new. In the contrary, the products issued from the remanufacturing process are, after one life, second hand products even if they have the same quality as a new one. Nevertheless, the remanufacturing process have the advantage of being cheaper than the other one. Indeed, one does not have to insert the cost of the process to treat old parts after shredding to make raw materials. In addition, remanufacturers normally give excellent warranty on remanufactured products.

Recycling is the wave of the immediate future. The potential savings in terms of energy and capital have long been obvious. The savings in terms of reduced environmental impact are less obvious but increasingly important. Increasing energy and other resources cost, together with increasing waste disposal cost, will favor greater use of recycling . But government policies driven by employment and environmental concerns may accelerate the shift towards greater recycling by gradually reducing taxes on labor and increasing taxes on extractive resource use.

Statement of the Problem What are the underlying imperatives driving the global trend

toward eco-efficiency and specially asset recovery at the firm level? What are the economic benefits of recycling and remanufacturing old products in the production process instead of paying for disposal cost?

Research Objectives This study seeks to establish the underlying imperatives towards

recycling and remanufacturing at the company level and the economic benefits that can be derived by companies practicing it. Likewise the study shall discuss the role of government regulation as a driver towards this change. Finally, there will be a review of specific cases from automobile and other selected industries. With emphasis on the potential for internalizing product by recovery, remanufacturing and material recycling.

Significance of the Study As firms become more and more responsible for collecting,

dismantling, and upgrading of used products and long-term reuse of products in whatever way will be beneficial in both environmental and socio-economic respect.



Scope and Limitation This study is expected to cover a representative sample of

automative parts remanufacturers and automotive service centers, as well as others like computers, computer printers (toners and cartridges), and other industries where recycling/ remanufacturing has been applied.

Operational Framework

The Mathematical Models. In this study some cost/ benefit recycling models and analysis have been applied on selected commercial applications. In addition, a model quantifying the benefits of green engineering, will examine a pair of major issues regarding product "greenness". First, it estimates the benefits of incorporating reuse, remanufacturing, and recycling into the designs of a green product and quantities, the conditions under which green practices become profitable (H. Scott Matthews and Lester B. Lave, 1997).

The model has two components of product cost (C;): initial manufacturing cost M

1 and turnaround cost T;- The initial cost of

manufacturing isM,. In each period after initial manufacture, the manufacturing cost is (1-k) M 1, where K might be thought of as the proportion of product's components that can be reused (O<k<l). Under these assumptions, the cost can be written:

c, c,

M, (1 - K) M, + T

Within this model, a perfectly reusable product is characterized by K = 1 (all components reusable). The quality of design, choice of materials, quality of manufacturing, and number of uses determine the value of K.

Methodology Considering that the study is relatively new under the

Philippine setting, actual industrial applications here and abroad had been included, showing applications of cost/ benefit models and green product design models to establish economic viability of recycling and remanufacturing.



Review of Related Literature

What is Reverse Logistics? Reverse Logistics is a rather general term. In the broadest sense, Reverse Logistics stands for operations related to the reuse of products and materials. The management of this operation referred to as Product Recovery Management (PRM). PRM is concerned with the care for the product and materials after these have been used. Some of these activities are, to some extent, similar to those occurring in case of internal returns of defective items due to unreliable production output. Reverse Logistics, though refers to all logistic activities to collect, disassemble, and process products, product parts, and/or materials in order to ensure a sustainable (environmental) recovery.

Why Reverse Logistics? Traditionally, manufacturers did feel responsible for their products after consumer use. Usually, used products are dumped or incinerated with considerable damage to the environment. The consumers and authorities expect manufacturers to reduce the waste generated by their products. Therefore, waste management has received increasing attention. Lately, due to new waste management legislation (especially in Germany), the emphasis has been shifting towards reverse logistics due to the high costs and environmental burdens of disposal. Firms become more and more responsible for collecting, dismantling, and upgrading of used products and packaging materials. The main reasons to become active in reverse logistics:

• Environmental laws that force firms to take back their products and take care of further disposal.

• Economic benefits of using returned products in the production process instead of paying for disposal cost, and

• The growing environmental consciousness of consumers. Long-term reuse of products in whatever way will be beneficial in both environmental and socio-economic respect.



Reverse Logistics as Competitive Strategy. Conventional wisdom holds that the flow of goods in a supply chain typically ends with the consumer. In reality, however, a number of supply chain functions occur after final distribution of the product to the consumer. Yet, even waste disposal, probably the most basic post-consumer activity, is not to be found on most supply chain flowcharts (Marier, 1998).

This situation is changing, however, accelerated by growing consumer awareness of recycling coupled with more stringent federal, state, and local regulations on waste disposal. The overriding problem is evident, for example, in the disposal regulations governing used motor oil, vehicle batteries, and tires. Increasingly, manufacturers and suppliers in these and other industries are being held responsible for their products once the consumer is done with them. In an effort to deal with this responsibility and the related supply chain complexity, many industries are beginning to build reusability into their products. And this, in turn, necessitates developing an infrastructure to handle post-distribution and post-consumption activities.

Within this evolving environment, many leading business now realize that a reverse logistic system combined with sourcereduction processes can be used to gain competitive advantage when they take responsibility for post-consumer waste, they are striving to generate revenue or cost savings or at a minimum, keep from losing money from regulatory compliance.

Making Reverse Logistics Profitable. A number of organizations are capitalizing logistics opportunities. Companies such as Eastman Kodak (reusable cameras), Hewlett-Packard (printer toner cartridges returned for refilling), and Sears (25 percent reduction in packaging) have implemented successful reuse and recycling programs. These initiatives not only have reduced the amount of waste fed into the supply chain and the landfills, but also have lowered operating cost for these companies.

All of these organizations have begun to think of the reverse logistics process as investment as opposed to simply minimizing the cost of waste management. They have been able to reduce their cost of investments from one or more of the following areas: raw material and packaging procurement, manufacturing, waste disposal, and current and future regulatory compliance.



Furthermore, many of the programs implemented by these leaders bring the added benefits from improved employee morale and public image.

For these companies, the benefits outweighed the costs of their reverse logistics and source-reduction programs. Yet cost is a real issue at multiple points in the typical supply waste sites. All of the REs (reverse engineering) associated with these reverse flows bring cost implications. Returns and recalls are obvious examples. But other REs include refusals, reworks, recyclables, rejects, reprocessed overruns, reuse, remake, redo, residues, reorder, resale, and returnable shipping containers and pallets.

These REs can be a real operational nightmare for companies because it is costly to process and administer. The direct indirect costs of correcting them can be staggering in some industries, such as logistics challenges at various points in the supply chain. One way is to shift the responsibility of minimizing the cash flow into the capital equipment, operating system, facilities, and people to support such activities. Through this cost minimization approach, firms spend money on the primary business and on logistics activities that directly serve customers, consumers, government, and society.

Another approach is to passively wait and be regulated into action. Companies can satisfy customers demands and government regulations by acting in a passive, follow the rules manner. Although this approach minimizes costs, it continues to shift the burden of waste disposal to the general public.

A more proactive alternative attempt to stimulate customer demand and reduce the cost to company and to society. As the automotive industry's experience has demonstrated, batteries can be a means of reducing waste management costs, while at the same time enhancing customer satisfaction and lowering production costs. By recycling 90 percent of the lead from used batteries, manufacturers have kept demand for new lead in check, thereby holding down costs to consumers.

Another proactive strategy is to reduce the amount of materials used in producing and delivering products. The computer industry has had some success here by developing smaller and more powerful products. Less material is used in producing and packaging the goods; meanwhile, costs drop along the supply chain. This source-reduction strategy benefits all supply chain number as well as consumers.



One more highly effective strategy is to reengineer how business is conducted. Through this paradigm-shifting approach, firms step back and take a hard look at what values reverse logistics processes can add for consumers specifically, and society in general. An insightful book on the subject is Jeremy Rifkin's The End of Work. The author identifies activities that are changing the way in which business is conducted and discussed the impact on supply chain activities and Rifkin offers a number of examples to support his thesis. One describes how music product companies now tap into communications systems to download new CD releases to compute retail outlets, where consumers select the new release they want. A blank CD is sourced, the recording is made, the promotional package jacket is printed in color, and the CD is assembled for sale. Logistics costs drop sharply as flexible micromanufacturing costs are increased.

Industry Segments React in Different Ways. As these reverse logistics and waste-reduction strategies go from passive to active, they incur value for customers and build loyalty. With consumers becoming more concerned about the environment, firms must look beyond their shipping and receiving docks. They can gain real competitive advantage by rejecting the conventional notion that once the product is out, disposal waste management becomes somebody else's problem.

The Remanufacturing Process. Jean-Jacques Andreu (1995) said that nowadays, the protection of the environment requires the reduction of waste and good management of the natural resources. Companies try to go this way by retrieving their old product. These actions are called recycling and remanufacturing.

The steps of the remanufacturing process will be defined in detail by sustaining design guidelines and practical examples. On the other hand, one can note that there are some differences in the older the steps depending on the needs of the factory. The processed introduced here is a possibility and is met frequently.

1. Check-in: This operation is practiced in a lot of factories that

reprocess large volumes of products like Xerox, Lucas or



Jasper Engines and Transmission or Sun Microsystem. In this stage, core inspection and identification are very much involved.

On the other hand, assuming a volume of treated product less important, a simple system could be sued to check in the products. For example, each time the product arrives to be remanufactured, the operator moulds in a mark on the housing. Then after three passes, that the product is considered no longer enough to be remanufactured anymore and should be sent for recycling.

In fact, each company has to choose the type of data that it wants to collect. Then, in certain cases, the check in can be just an operation to put the products on the line and nothing else.

2. Disassembling This stage is very important and demands a lot of

attention from the designer during the design study. Indeed the time and the easiness of disassembly are the keys to earn or lose money in the remanufacturing process. More precisely, if a product needs a long time and lot of operation to be disassembled, the cost will increase.

Consequently, there is a lot of guidelines that can help the designer to design a good product for disassembly.

3. Inspecting The aim of this operation is to detect wear or assess

the condition of parts subject to wear. The inspection shall be performed such that the fitness for further use or degree of wear can be detected as easily and clearly as possible. So, this operation must be very quick. In most cases, just a visual check is necessary.

4. Sorting Just after inspection, the components have to be

sorted. At first the unreusable parts are rejected for shredding or over operation of recycling. It's therefore important to sort the old parts by their type of material. Consequently the operator must know very quickly the kind of material. A solution could be a different colour for each material or a code moulding on the parts.



5. Cleaning This operation is necessary to eliminate all the dirty

substances that could modify or alter the functionality of the product. More over it is obvious that the external parts of a machine for example have to be cleaned before painting or other operations. Nevertheless it is very important to do the validity or not of this operation. Indeed if this operation is not obliged for a certain part, we will have an increase in the final cost.

The process to clean the parts varies and depends on the kind of parts.

Types of cleaning operations Nevertheless it's important to underline that if a special bath

is used, it has to avoid to be toxic for environment. Several problems could be met in the cleaning operation. That's the reason why several rules have to be followed.

• Avoid using paper labels with glue. It may be preferable to mould writing directly on the component.

• Avoid printing writing on the components.

• Avoid having closed angles in the components because of the difficulty to clean.

• Try to make the label removable.

6. Reconditioning Normally this operation concerns the parts that have

to be painted or surface treated. In fact it's a pre-assembly operator. Nevertheless, several parts specified to be worn during the life of the product are also concerned (e.g., bearings, rings). It is preferable that product parts should be charged with minimum of operation, and if possible without machining. Nevertheless, in the majority of the cases, several cutting processes such as turning, milling is needed. For example, one is obliged to change the brushes of the electric motor and skim the commutator. These parts wear the most in a motor. Moreover, this area is very important to the performance and the life of the motor.

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Consequently, to reduce the cost of this stage, the designer has to reduce the number of wearing parts. Another possibility is to design strong parts enough to obviate need for reconditioning operation. Nevertheless, this solution may increase the basic price of the product. The designer has to compare the cost of a classic component and its reconditioning operation with the cost of a stronger part.

7. Reassembling The reassembly of the product takes place in small

batch assembly lines. It is a difficult task to prepare the required quantity of new parts in high proportion, as this depends on the number of reusable parts from disassembled products, and is subject to considerable variation with respect to the product, the parts and production batch size. To save new parts, the number of reassembled products if the required surplus to defect products is available. Thus a reduction, for example by 10%, in the number of assembly parts may often lead to a reduction of 20% in the number of new parts required.

The assembly procedure is followed by functional inspection or test run of each manufactured product. By this 1 00% inspection, the reliability of reconditioned products, which can be observed in later operation, is often higher than that of similar products inspected only by random sampling, and many times higher than the reliability of just "repaired" products.

8. Control & Testing This stage is very important and requires a lot of

attention. The aim is to control so that the remanufactured product answers to the same quality features as a new one.

At the same time, it is a good way to compare the performance of the new products with the old ones after one or two passes through the remanufacturing process. On the other hand, these results will show the number of passes that make the product unsatisfactory.

Moreover, after several cycles, the life time of the product decreases.



9. Pre-paint inspection

10. Painting

11 . Final Inspection

12. Packaging

This operation is similar to the firs one 'Check in'. In fact, the aim is to record the new data on the product before sending it to market for another life.

At least, this operation includes the packaging of the product.

Recovery Options DIRECT REUSE: This type of recovery involves products

which do not receive repair procedure but are cleaned and brought to a state where they can be directly reused by the customer, like pallets, bottles, etc.

MATERIALS RECYCLING: In this type of recovery, the product does not retain its function. The purpose is to use some or all of the materials from the returned goods. The recovered materials can be utilized in the production process of the original product or maybe inputs of other industrial process.

REPAIR: The product is brought back to a functioning/ working state usually on a one-at-a-time basis after this recovery process. The process involves trouble shooting to identify the malfunction and then, appropriate disassembly, repair and reassembly of a single product. We use the term to mean that activity takes place in product service centers like T.V. repair shops, automobiles garage, etc., and do-ityourself repair by consumers.

REFURBISHING: A good process where the product/ component is upgraded such that it meets higher quality standards than the original product. The recovered products are usually brought back to some central facility for



processing. However, upon disassembly of a product, the parts are kept together and after cleaning, inspecting and replacing with new parts where necessary, the original product is reassembled with most of its original parts. Other words synonymous with refurbishing are reworking, rebuilding, or reconditioning.

REMANUFACTURING: In this type of recovery operation, the products are completely disassembled and all modules and parts are examined in detail. Worn-out components are either repaired or replaced with the new ones. If required and feasible, model upgrading is performed on some technology modules. The remanufactured products receive a high quality assurance and are delivered to customers under new product warranty contracts. In principle, remanufactured products can be sold at the same markets that of the original product.

Without disposal, this model would fit the industrial economy ideal; if disposal is reduced, there should be some gains in pollution prevention and green design. Manufacturers can alter the fate of a product, from disposal to reuse, repair, remanufacturing or recycling by altering design, choice of materials, quality of manufacturing, and the terms of sale. Since manufacturers presently do not bear disposal cost and do not have access to the product after consumer use, there is little or no incentive to design products for reuse rather than disposal, to address industrial societies problems like waste disposal, and at the same time, address their concerns about shortage of raw materials in the future.

Options for Replacement Parts

NEW With new parts, one can rely on the quality, but the price

tag is high. New parts are often the only viable option for fast moving, relatively low dollar maintenance and replacement of items such as filters, brake pads, ignition components, etc. But when it comes to hard parts, i.e., ABS unit, engine computers, and power steering components, to name a few, one can have a high dollar price tag that puts a big dent in the wallet.



USED Used parts are another option. If you can take the time

to search for the part and actually locate the right one, the fact that it has been used on a previous vehicle may not make it last the life of your vehicle. This can lead you back to the repair shop in just a short time.

REMANUFACTURED Then, there is the remanufactured option-the best

option in terms of economy and performance. Remanufactured parts are 30-50% below the cost of new ones and perform the same for one's vehicle. Remanufacturing is the process of taking used parts, completely disassembling and thoroughly cleaning them, replacing the worn components, with original quality components and restoring them to their original function. The testing and procedures are the same as the original equipment manufacturers. So the part is as good as new ... with a much better price.

Quick Facts on Remanufacturing • Remanufacturing is a 53-billion-dollar industry • There are over 73,000 remanufacturing firms in the U.S.

alone • Automotive remanufacturing is a 36.5-billion-dollar

industry • 46% of the parts of today's automobiles are available as

remanufactured units • Remanufacturing is labor-intensive business, creating

more jobs no matter where the cars are made • Automotive remanufacturing recycles 80% of the energy

and 85% of the material • Materials are kept off landfills • Automotive remanufacturing reduces emissions from

resmelt castings • The worldwide remanufacturing industry saves the

equivalent of energy contained in 10.7 million barrels of crude oil and the raw materials equal to 155,000 railroad carts filled to capacity annually.



INDUSTRIAL APPLICATIONS OF RECYCLING AND REMANUFACTURING

Automotive Industry Many remanufacturers in the automotive industry rebuild

starters, alternators, aircon compressors, bearings, surplus spark plugs, batteries, diesel fuel injection pumps, and anti-lock brake system, to name a few of the automotive applications of remanufacturing. Custom remanufacturing services for alternators and starters, for uncommon specialty and vintage vehicles, are all being offered in the industry plus the fact that parts are remanufactured on a first-class assembly line with standardized, repeatable procedures for better quality control. Components are likewise tested under simulated operating conditions. Remanufacturers guarantee quality workmanship on defective parts. Majority also offers a rebate where used unit is returned following purchase of an exchange unit and actively purchase "cores" domestically and overseas. Customers get real peace of mind with remanufacturers parts as all are warranted for as long as full six months-not just from the date of return, but from the date they are placed in service.

PC Remanufacturing Personal computers are among the durable goods with the

shortest life cycle. Give the increased population of PCs, and their quick turnover, their disposal represent a considerable environmental concern. However, many users do not require the latest technology for running their applications. This opens an opportunity for renovated or remanufactured machines. It allows for the existence of two markets: one for remanufactured PCs and another for all-new PCs (Geraldo, 1997).

Mobile Telephones Australia is recycling mobile phones and batteries to be melted

down with the resulting slag recycled as building materials for resurfacing roads. The first in the world, the Australian recycling scheme is voluntary unlike the German recycling program which was introduced by politicians via an act of parliament.

Tire Remanufacturing The world market for tires is described to identify the current



,naterial flow from raw materials to tires and used tire disposal problem. Ferrer Geraldo (1997) describes the value-adding operations in the tire production process and in the tire retreading process. Once retreading is identified as the only recovery alternative that maximizes tire utilization, it is explained why heat generation is the only recovery alternative, when retreading is not technically feasible.

Batteries Lead-acid batteries are used in motor vehicles, marine vehicles

and industrial applications. Thus, they represent a potentially large contribution to the waste stream. The hazardous content of these batteries is lead which counts for approximately 15 to 20 lb. per battery. (Glaub, 1993).

Fortunately, the majority of lead-acid batteries are recycled. The sulfuric acid is drained and either recycled or neutralized. The lead is removed from the plastic housing of the battery and smelted to produce secondary lead, most of which is used for new batteries. Some battery processors also reclaim the plastic from the battery.

Inkjet and Laser Cartridges Remanufacturing Remanufacturing has come to include laser toner, inkjet, as

well as dot matrix printer ribbons, which include cash registers. New toner is simply inserted into the cartridge. Since cartridges are engineered to be used one time, the mechanical breakdown were frequent. Today, remanufacturing is a for more advanced. Remanufacturers test new cartridges to determine the number of copies that are generated. They remanufacture the used cartridge to duplicate the results of new cartridges.

Reputable remanufacturers replace "wear parts" resulting in printing performance equivalent to original.

High Quality of Remanufactured Parts "Remanufacturing is the ultimate form of recycling," says Dr.

Rolf Steinhilper (1998). As a process, remanufacturing has been around for more than 60 years, restoring old products to like-new performance. By extending product life, remanufacturing saves 85 percent of the energy that went into manufacturing the original product. In his book, Dr. Steinhilper promotes the concept of remanufacturing as the ultimate form of recycling to all sectors of the general population, form business owners to politicians to

DLSU Business & Economics Review Volume 12 No.! 2000-2001


economists to futurists to policy-makers, and ultimately, to consumers.

Remanufacturers believe that their products are high-uality alternatives to new parts. When a product is "rebuilt'', only the faulty components are replaced or "fixed" and the rest of the unit is cleaned and painted. In a remanufacturing facility, each component of the unit is cleaned and examined. All component parts are checked and are brought back to specification should it be necessary. When finished, a remanufactured unit should function as well as a new unit and provide a similar seNice or longer. On the other hand, a "rebuilt'' unit will begin its life where it left off with only the defective component replaced. Although remanufacturers can rebuild parts core to order, the goal is to provide the customer a remanufactured unit from their extensive inventory on an "exchange basis". Remanufacturers have an extensive core acquisition program which provides cores for remanufactured products, offers a better price, and equals the quality of the new product. An increase in the price of the new one will most certainly lead to an increase in the quantity demanded for the remanufactured ones (N.S. Poblador, 1996).

Issues on Computer Recycling Local and state government concerns about computer discards

is mounting across the United States. Computers and other electronic equipment are often characterized as contributing a growing amount of lead to the solid waste stream. One of the largest concerns about PC disposal is the amount of lead- and considered a hazardous waste-contained in computer monitor CATs (cathode ray tubes) and lithium batteries. Recovery of used computers can be oriented toward processing for resale, refurbishment, component and parts recovery or material recycling.

Due to rapid changes in technology and consumer demand for the newest technology, computers are estimated to depreciate at the rate of 40 percent per year (Leah B. Jung, 1999).

The resultant low value for end-of-life PCs does not often compensate financially for the costs associated with recycling used equipment. Nevertheless, a large amount of used computers are expected to be discarded in the coming years. To reduce discards, companies and organizations should work with their procurement departments and vendors to ensure that only upgradable equipment is purchased. The goal is to extend the life of the product as long as possible before it becomes discardable.

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Moreover, one may inquire from computer vendors about product take-back, trade-in policies, and information on recycling outlets. Computer manufacturers and/ or dealers are likely to have definite uses for old computer parts, and to design their equipment for longer life and more cost effective recycling.

Next, consider buying refurbished computer equipment. It may not only reduce purchase costs, but also help ensure the existence of markets for used end-of-life equipment.

Finally, establish a program for getting rid of old computer equipment as soon as it is deemed obsolete. Each day that an equipment is unused, it loses reuse and recycling value.

Therefore, as demand for more computer recycling increases and markets for used equipment grow, increased opportunities for recycling or refurbishing old equipment should develop. In the shortterm the cost for managing old computers is likely to remain high. A preferred strategy is to extend the life of existing equipment and develop a program for effectively managing end-of-life equipment.

THE ECONOMICS OF RECYCLING AND REMANUFACTURING

SAN JOSE COMPUTER COLLECTION AND RECYCLING PILOT

Background October 1997, used computers were collected from consumers

in San Jose, California as part of a pilot project supported by the U.S. EPA's Common Sense Initiative. The project aimed to determine the feasibility of collecting equipment at retail stores, identify potential barriers for using industry partnership, and determine the economics for collecting consumer equipment through this industry approach.

Methodology For the project, used computer equipment (i.e., laptops, hard

drivers, printers, etc.) was dropped off by consumers at one of three participating electronic equipment retail stores. A minimum of one equipment per week was collected and picked up by the recycler and transported to a processing facility. There, equipment was sorted for resale or materials recovery. Revenue was recorded for resold equipment. Unsold equipment was dismantled, with materials sorted into different scrap materials categories. The scrapped materials were then sold and/ or given to recyclers for further processing.



Weight and Volume Computer equipment was collected from 01 October through

02 November. A total of 4220 cubic feet or 61, 600 pounds (30.8 tons) of equipment was collected. Of the total weight, approximately 90% was not resalable and had to be "scrapped" or processed for material recovery. Over 30,000 pounds computer monitors could not be resold.

A total of over 2800 pieces of computer equipment was collected. In number, CPUs represented 35% of collected equipment, monitors reached 33%, and printers represented 15% of all collected items. Laptops only represented one percent of the total mix of equipment.

Revenue Revenue received from the used computer equipment fell into

two categories:

(1) revenue associated with the sale of the equipment and/ or equipment parts; and

(2) revenue received from the sale of related scrap materials (i.e., aluminum, wire).

Out of a total revenue of $5,120, 38% was generated by equipment resale while 62% came from the sale of scrap material. The majority of the resold equipment was black and white computer monitors. Almost $1200 was received for 95 resold monitors. The 95 monitors, however, represented only ten percent (1 0%) of the total number of monitors received during the project; the rest of the monitors were recycled.

Costs Costs for the San Jose pilot included:

• transportation costs; • processing (i.e., sorting, dismantling, and material separation)

costs, and • monitor recycling costs.

Transportation costs for the project totalled $480. These costs were based on a total number of 20 pickups and a roundtrip driven mileage of 360 miles, while the processing costs amounted to $7500.



Because the project's recycler had a unique, low-cost capability for recycling computer monitors, two separate sets of monitor recycling costs were used as data. The recycler's method (recycling monitors overseas in a third world country) cost $0.05/lb while the costs for recycling the monitors through U.S. vendors ran ten times higher, or $0.50 per pound.

Net Economics Due to the significant difference in monitor recycling costs, two

net economic scenarios were calculated from the San Jose project. The net economics for the first scenario (with the monitors recycled overseas) came to a program cost of $4,373 or $142 per ton. The net economics associated with the second scenario (monitors recycled through U.S. vendors) reached a cost of $17,990 or $584 perton.

%of Revenue Item Dollars or Cost

Revenue $1,940.50 38% Equipment Sale 3,179.50 62% Scrap Material Sale 5,120.00 Net Revenue

Cost-Scenario One (Monitors Recycled Overseas)

Transportation 480.00 5% ProcessinQ 7,500.00 79% Monitor Recycling 1,513.00 16% Net Costs 9,493.00

Costs-Scenario Two {Monitors Recycled in the U.S.)

Transportation 480.00 2% Processing 7,500.00 32% Monitor Recycling 15,130.00 65% Net Costs 23,110.00

Net Economics-Scenario One $4,373.00 net cost ($142/ton)

Net Economics Scenario Two $17,990.00 net 4 times higher net cost (584/ ton) cost than Scenario

One

Barriers: Government Regulation



Because of costs associated with environmental regulation, the recycling of CRT-containing monitors creates barriers for the recycling of computer equipment. Due to the lead content of monitor CRT glass, management of discarded CRT glass is usually considered a regulated hazardous waste activity. This CRT regulation causes additional handling, transportation, processing, and documentation costs to occur during equipment recycling.

A few days before the start of the San Jose project, a state environmental agency determined that a permit variance was required for collecting and managing the used computer equipment because the state considered the equipment as regulated waste. Although the permit variance was obtained, this last-minute requirement almost stalled the entire project.

Barriers: Corporate Support Another barrier encountered was a lack of corporate support

of two of the retail stores. At these stores, regional management prohibited expenditures for advertisement of the project. Although local store management supported the collection program, corporate management instituted restrictions that decreased the project's viability.

At the third store, however, corporate management fully supported the collection program. This resulted in equipment collection which is ten-fold higher than the two stores' collections combined.

Conclusion The farge amount of material coffected from the San Jose

project shows that collecting and recycling used consumer computer equipment through retail stores is feasible. However, the overall cost for the project ran from approximately $4,400 to $18,000. Although these costs are substantial, they are still lower than costs that could have been encountered if the monitors had been disposed as hazardous waste and the remaining equipment had been landfilled. The fact that the study found dramatically different costs for recycling computer monitors ($.50 versus $0.5 per monitor) demonstrates that there is not a singular set of economics for computer recycling. Additionally, the project economics do not include non-quantifiable benefits associated with recycling of the computer equipment (e.g., enhanced government/industry/ public relations or enhanced environmental protection).



Comparative Analysis of Options For Managing Used Computer Equipment

$----~------~----~--------1 increasing costs 1 ____....

$2400 • $3800 Landfill $78-$1 23/ton

$4373-$1 7,990 Recycle $142 -$584/ton

I

$34,780-$35,390 Monitors: Hazardous Waste Remaining Equipment: Landfilled $1 129-$1 149 I ton

BELL COMMUNICATIONS RESEARCH (INC.) Bellcore's work is primarily conducted in offices, commuter

centers, and laboratories in New Jersey. The company develops telecommunications software, integrated systems, and industrywide standards. Formed in 1984, as a result of the breakup of the Bell system, Bellcore's innovations include Video Window, video dialtone, and countless telecommuting and home phone service enhancements.

• Total number of employees: 6,150 • Types of building: Primarily offices and computer areas

Bellcore currently recycles:

• All grades of office paper • Cardboard/corrugated • Aluminum cans • Glass bottles • Newspaper • Hardcover books • Vinyl Binders • Styrofoam food scraps (pilot program) • Fluorescent lamps • Cafeteria food scraps (pilot program) • Laser printer cartridges • Lead/ acid batteries • Spent laboratory solvents • Small batteries (all types)



Recycling and reuse of laser printer cartridges Bellcore staff use thousands of laser printer cartridges on

an annual basis. Except for those considered unsalvageable, each is shipped off for remanufacturing and returned to Bellcore for reuse, at substantial savings over the cost of a brand new cartridge.

• Estimated % reduction of this waste stream:-80% • Weight of waste avoided:9,000 lbs/ year (3 lbs/ cartridge

x 3,000 cartridges= 9,000 lbs) • Volume of compacted waste avoided: 100 cubic yards/

year (3,000 cartridges/cubic yard • 30 cartridges/ cubic yard = 1 00 cubic yards) • Cost savings before avoided disposal fees: $75,000/year

(3,000 cartridge x ____ _ • $25 savings/ catridge = $75,000)

SNOWMOBILE AUTOCARE CENTER (PHILIPPINES)

Cost/Benefit Remanufacturing Model AIRCON Compressor Sanden 507 Brand

A Purchase Cost of Brand New Sanden 507 Car Compressor

B. Remanufactured Sanden 507 Car Compressor Core Sanden 507 Parts to be replaced (bearings, etc.) Oil Change Painting Labor: disassembly, cleaning, assembly,

Testing Total Remanufactured cost

Net Savings per remanufactured Sanden 507 AIRCON COMPRESSOR

P5,500.00

P1 ,000.00

500.00 20.00 30.00

50.00 P1 ,600.00

P3,900.00

Note: To generate more patronage for remanufactured auto parts, substantial discounts are offered to the customer plus three to six months warranty on installed car air-conditioning compressor, depending upon the condition of the core upon disassembly.



PRICE SETTING FOR GREEN DESIGN Industrial ecology says that economics can be thought of in

ecological terms. The output from one process is the input to another process. Industrial societies face increasing problems with waste disposal, particularly hazardous waste. At the same time, industrial societies are concerned about shortage of raw materials in the future. The current industrial structure sells products to consumers who ultimately transform them into waste to be disposed of. Reuse, remanufacture, and recycling requires a more extensive interaction between consumer and producer than what currently exists. New market structure is required to accommodate this interaction.

A model quantifying the benefits of green engineering (Matthews and Lave, 1997) must examine a pair of major issues regarding product "greenness". First, it must estimate the benefits of incorporating reuse, remanufacturing, and recycling into the design of a green product. Second, it must quantify the conditions under which green practices become profitable.

Life Cycle Modeling of Manufacturing Green products by design can have their components or entire

assemblies used more than once. This figure represents goods in an economy where the alternatives of reuse, remanufacturing, and recycling are all plausible given the economic conditions.

Raw Materials

Processing

Remanufacture

Recycling Reuse

Disposal

Without disposal, this model would fit the industrial ecology ideal; if disposal is reduced, there should be some gains in pollution prevention and green design.

Manufacturers can alter the fate of a product, from disposal to reuse, repair, remanufacturing, or recycling by altering design, choice of materials, quality of manufacturing, and the terms of sale. Since manufacturers presently do not bear disposal cost and do not have access to the product after consumer use, there



is little or no incentive to design products for reuse rather than disposal. This paper considers the effect of incorporating disposal costs in a green product.

The Model The more had two components of product cost (CI): initial

manufacturing cost M 1 and turnaround cost T1. The initial cost of manufacturing is M1. In each period after initial manufacture, the manufacturing cost is (1-k) M1, where k might be thought of as the proportion of a product's components that can be reused (0 < k < 1 ).

Under these assumptions the costs can be written:

C1 C1

= =

M1 (1-k) M1 + T

Design, choice of materials, quality of manufacturing, and number of uses determine the value of k.

Consider a remanufactured product such as a laser printer toner cartridge. Most of the expensive components can be reused at little cost. This table shows a schedule of costs for such a product, assuming that k= 0.7 (70% reusable), initial manufacturing cost M1 = 40, turnaround cost T = 2, and number uses, as well as the (potentially toxic) disposal cost at the end of its life. The optimal price given these conditions is also shown.

Use Main Cost Turn Cost Use Disp End Disp End Toxic 1 Cost {i) Life Cost Price

1 40 0 0 0 I o 0 0 0

2 12 ,2 3.6 0 0 17.6 57.6 28.8

3 12 '2 3.6 0 0 17.6 75.2 25.1

4 12 2 3.6 0 0 17.6 92.8 23.2

5 12 2 3.6 0 0 17.6 110.4 22.1

10 12 2 3.6 0 0 117.6 198.4 19.8

20 12 2 3.6 0 0 17.6 374.4 18.7

End 0 2 0 5 7 14 388.4 19.4

The model has two components of product cost:

c, = (1-K) M, + T

DLSU Business & Economics Review Volume 12 No. I 2000-2001


product cost initial manufacturing cost Turnaround cost

Where: C, =

M, = T, =

K = proportion of a product's components that can be reused (0 < K, 1)

Note: design, choice of materials, quality of manufacturing and number of uses determine the value of K.

Based on the foregowing table, the life's cost takes the following form:

C, = M,atuse, n = 1

LC = Life's Cost = C, + C; were C; is the additional cost at each use (n)

Also shown is the computed green design price (P 0

)

Po= !.Q n

For optimality, the revenue and costs associated with a decision variable may be represented symbolically as follows:

R = LC (x) n

where x = value of decision variable

C = LC (x)

The managerial objective:

Maximize net revenue from the variable, that is,

Maximize: n = (LC) (x) - LC (x) n

at ~ (LC) - d --dx - n /dx - d(LC)/dx = 0

therfore, d { L; ) /dx = d(LC) /dx



At the optimum level of operation, the marginal changes in revenue and costs associated with the decision variable in question are equal.

The only distinction in the initial manufacture of the product, the decision variable was highly monitored and controlled like it is in a tightly controlled production process. This tightly controlled situation is not present in the product's turn around after its first use, when it is considered "surplus", unless the manufacturer has systems in place to recover the green product after its first use.

The researcher's conclusion therefore, even with environmental attributes, given that they can be recycled, reused or remanufactured, is that the condition of optimality still holds. The model just maintains the report's conclusion that the inclusion of disposal costs of a product over its lifetime and generalizes new optimal solutions based on the se additional costs. Extensions of the basic model also provides strong tolls to product designers to see exactly what trade offs in this system are between increased lifetime costs and product price.

Through the green design initiative, one is solving problems and building tools that help businesses accomplish more with less. The focus is on developing practical pollution prevention technologies and lowering costs, by recycling scarce resources, using fewer rate materials, and creating better products.

CONCLUSION This model serves several purposes. First of all, it creates a

generalized system for accounting for costs in a manufacturing setting. It further supports the lifecycle nature of a green product and shows the optimal price for all cases.

Finally, the model accounts for the inclusion of disposal costs of a product over its lifetime and generalizes new optimal solutions based on these additional costs. Extensions of the basic model also provide strong tools to designers to see exactly what the tradeoffs in this system are between increased lifetime costs and product price.



THE NEEDS OF THE RECYCLING I REMANUFACTURING INDUSTRY

THE NEED FOR MARKET DEVELOPMENT Gregg D. Sutherland of Resource Integration System Ltd. in

Granby, Connecticut said that typical economic behavior dictates that price and quantity are directly related. As price increases, quantity supplied should increase to take advantage of the new price. This traditional behavior is supposed to work in the other direction as well, so that when prices fall, quantity supplied should decrease due to reduced price incentive.

However, recent recycling markets have not followed these traditional economic precepts, at least on the surface. In fact, for many grades of recyclable materials, the volume supplied has increased to record levels while prices have fallen to historic lows. How can such contrary behavior occur? The answer lies in the fact that the supply of recyclables has been artificially stimulated by government mandate, while the demand for recyclables has been largely unaffected. The result is growing supplies along with declining prices.

The development of end markets for recyclable materials is now advancing to the forefront of vital recycling issues. Without effective development of these markets, recycling cannot grow. Accordingly, market development is now receiving the attention from government policy makers, from recyclers, and from industry that it requires in order to "close the loop" on recycling.

Definition of Terms When discussing market development, it is important to start

with a clear understanding of the terminology. This is because the term "market" depends largely on perspective. For a generator of waste material, the "market" is the recycler who collects the material. That recycler then sorts, grades, and processes the material for shipment to his "market"-a manufacturer who is an end user of that material as a raw feedstock for his product The end user then sells the product to her "market", a consumer who purchases the finished product with recycled material content



Processed Secondary Materials

"Recycler~

(Collects, processes and

ships secondary materials)

Secondary Materials

Waste

~End User" (Remanufactures finished products from secondary

materials)

Finished Products

Definition of key recycling entities

• A consumer is a person or other entity who purchases a finished product that may or may not include recycled content. After consuming the product, the consumer becomes a generator of any remaining waste material. Consumers and generators can be individuals, business, or government units. Examples include homeowners who produce old newspapers and scrap packaging or business that produce used corrugated boxes.

• A recycler is a person or other entity who collects scrap materials for sorting, processing, and shipping to a manufacturer. Manufacturers often make the point that, technically, the term "recycler" does not apply fully to the business usually do not complete the loop by turning the material into a finished product. Nonetheless, because they take the first step toward diverting material from the waste stream and they are widely dispersed and visible to generators, these businesses are commonly called recyclers anyway.



• An end user is a person or other entity who remanufactures a finished product from secondary, scrap materials that have been diverted from the waste stream. This use of the term "end user" is based on the concept of secondary materials as a raw material. Thus, the end user is the manufacturer who uses that raw material, as opposed to the consumer who then buys the finished product with recycled content. End users often combine secondary materials with "virgin" materials.

• Given these definitions, market development means development of end users of secondary materials.

The Goals of Market Development Before discussing ways to promote market development, it

is important to understand the goals of this activity.

Goals of Market Development • Prevent imbalances • Promote economically sustainable recycling • Minimize need for government intervention • Promote economic development • Conserve ancillary resources

Prevent Imbalances The most obvious goals of market development is to match

end-use infrastructure growth with collection infrastructure growth. Imbalances, where collection grows rapidly compared to end-use market, have resulted in severe material gluts that threaten the operational and financial viability of many recycling programs.

Promote Economically Sustainable Recycling While creating a balance between collection and end use is

the most obvious goals of market development, it is not the only goal. In fact, from a long-term perspective, there may be an even more important goal of market development: to promote economically sustainable recycling.

Because market development promotes the demand for recyclable materials, the price of these materials increases. Figure



1 illustrates a classic economic supply and demand curve, showing that price (as well as quantity) increases from point 1 to point 2 if market development can shift the demand curve by causing a structural increases in demand.

Market Development Material Price

Original Material Price

Price

Demand after Market Development

Demand Original

Figure 1: Market Development Effect on Price

Volume

Market development improves the economics of recycling. An improvement in the economic motives to recycle makes all varieties of recycling programs more viable and sustainable.

Minimize Need For Government Intervention Another goal of market development is to minimize the need

for governmental involvement in recycling programs. Currently, most public sector policy toward recycling is based on overcoming economic barriers to recycling by funding new collection and processing systems (in the case residential recycling) or by mandating generators to bear the incremental costs of increased recycling that may or may not be directly economical (in the case of commercial recycling). To implement and enforce these policies can be expensive, intrusive, and bureaucratic. While there is little dispute that increased government involvement is needed to achieve recycling targets, it is imperative to remember that private sector can play an effective role in achieving those goals. Market development is the most effective way to provide economic incentives.

Promote Economic Development Another goal for market development is that of general

economic development. Most jurisdictions have committed



resources toward economic development. As a matter of local public policy, these actions usually focus on providing information to prospective new businesses and on making special arrangements to attract specific, large-scale new businesses. Recycling end users are excellent targets for such market development efforts, because

• End users are often large-scale businesses that can be significant employers.

• End users engage in an activity-recycling-that holds widespread public appeal.

• Recycling is sustainable use of resources and usually has significant energy savings over virgin material use.

• Recycling is perceived as long-term growth industry that can lend economic stability to a jurisdiction.

ConseNe Ancillary Resources One other goal for market development is that jurisdictions

are eager to take advantage of the ancillary resource conservation that recycling can cause. Manufacturing that uses secondary materials generally takes less energy and water and produces less waste than that which uses virgin materials.

TAXATION AND RECYCLING The need for market development to excite demand for

remanufactured/ recycled products can not be over emphasized. The role of the government regulations in this endeavor is likewise paramount.

Taxation affects behavior; there are many examples in which tax increases have discouraged the consumption of the taxed good, and tax reductions have encouraged consumption. A subsidy, the opposite of a tax, may be equally effective. The size of the effect of a change in a tax or subsidy depends on the elasticity of demand - the responsiveness of the quantity consumed to the full price. Taxes that might affect recycling include income taxes levied on corporations and individuals, natural resource royalties or fees, and excise taxes on products or services.

Recycled materials complete with virgin materials in many industries, and in some industries' products with recycled content



complete with products from 100 percent virgin input. Recycling may be discouraged if tax rates are higher for recycled materials at any stage of the production, distribution, and recycling process, than they are for virgin materials. Government subsidies to natural resource industries will discourage that use of recycled materials. However, the complex interaction among Ontario producers and consumers, with the import and export of raw materials, intermediate goods and final goods, means that predicting the effect of a given tax regime requires careful analysis. Simple proposals to change taxes or subsidies may not have the assumed effect on recycling, or may have undesirable side effects (Donald N. Dewees, 1991).

THE NEED FOR AGGRESSIVE PUBLIC AWARENESS PROGRAMS

Until recently, industry leaders were unaware of the seriousness of consumer's demand for recycling and recyclable packaging. Slowly they are responding to consumer demand and to the government intervention exemplified by the need for alternatives to expensive waste disposal practices.

"Awareness," according to Webster's New Collegiate Dictionary, means "having or showing realization, perception, or knowledge." In this section, one assumes there is a need to increase public awareness about recycling. In doing so, one discovers that to achieve the result, which is participation within recycling programs, one must increase awareness about other interrelated aspects of solid waste management. Furthermore, awareness is perceived as the first and necessary step leading to adoption or rejection of a product or recycling service. If everyone is to follow through on the steps in between, a need for awareness and achieving participation, a strategy must be planned as the marketing professional does.

Well-known innovators Boone and Kurtz, fractionate the "consumer adoption process" into five stages:

1. Awareness 2. Interest 3. Evaluation 4. Trial 5. Adoption or rejection

A recycling program's success or failure overwhelmingly depends on the adoption by the entire community.

DLSU Business & Economics Review Volume 12 No,l 2000-2001


CONCLUSION AND RECOMMENDATION

Developed countries like Germany and the U.S. began voluntary or mandatory recycling program in the late 1980s based on claims that recycling trash could achieve significant energy savings and environmental benefits.

Critics say that recycling is not economical. One reason they put forward is that some people already pay a higher cost for trash disposal than they realize. They ask why they must pay more to give their recyclables to someone who will sell them? This is an illusion. The imperatives of recycling and remanufacturing can be gleaned below:

• Recycling avoids costs related to future disposal, e.g., landfill depletion

• Recycling cuts down on waste produced by processing raw materials into usable forms.

• Recycling requires less refining than raw materials. Example, it takes much less energy to melt down an aluminum can to make another aluminum can.

• If energy is reduced by methods such as recycling, less pollution is produced. This reduces everyone's cost in terms of paying to reduce pollution and in limiting damage to natural resources.

• Once the long-term costs and advantages are weighed, recycling does make economic sense. Using resources wisely is always economical.

• Recycling and remanufacturing as a process, have restored old products to new-life performance. By extending product life, remanufacturing saves 85 percent of the energy that went into manufacturing the original product.

• Remanufactured parts are high quality alternative to new parts as they function as well as a new unit or provide similar service or longer at a cheaper price, making remanufacturing the ultimate form of recycling.

In this study, examples were given proving the economics of recycling and remanufacturing. Recycling and remanufacturing is the wave of the future. The potential savings in terms of energy



and capital have long been obvious. The advantages of large manufacturers with economies of scale is declining overtime as the inventory of potentially recyclable materials in industrialized society grows to a point that efficient collection and logistic systems, and efficient markets, justify significant investments in recycling. Increasing energy and other resource costs, together with increasing costs of waste disposal, will favor this shift in any case. With government support driven by employment and environmental concerns, may accelerate the shift by gradually reducing taxes on labor, and recycled products and increasing taxes on extractive resource use. Likewise addressing the needs of the recycling industry as regards market development, and the need for aggressive public awareness on the serious demand for recycling and recyclables will go a long way in an efficient allocation of scarce resources.

BIBLIOGRAPHY

Andreu, J. "The Remanufacturing Process." In Design for Environment Research Group. Design and Manufacture Manchester Metropolitan University: Department of Mechanical Engineering, 1995.

Dewees, D. Taxation and Recycling. Presented to Recycling Council of Ontario, 12., Conference Annual Conference Toronto. Toronto: Department of Economics. 1991

Ferrer, G. 'The economics of PC remanufacturing." INSEAD, Research and Development Department, Working Paper No. 97/37TM.

Glaub, J. Household hazardous wastes. Recycling handbook, 1993

Jung, L. The conundrum of computer recycling. Vista Environmental, Inc., 1999.

Marien, E. "Reverse logistics as comparative strategy." Cahners Business Information. (Spring 1998).



Matthews, S. and Lave, L. Green design initiative. Carnegie Mellon University, 1997.

Poblador, N. Economics of the firm: Managerial applications. Quezon City: University of the Philippines Press, 1996.

Rifkins, J. The end of work. 1998.

Steinhilper, R. Remanufacturing the ultimate form of recycling. 1998.


Documents

The Economics of Recycling and Remanufacturing · The Economics of Recycling and Remanufacturing Edgardo N. Bolinao Business Management Department, De La Sulle University-Manila BACKGROUND