A Shifting Landscape

The economy has taken considerable twists and turns since Recycling Today published our inaugural list of the 20 Largest Electronics Recyclers in North America in the July 2008 issue.

Those economic twists and turns have had an impact on the second version of the list. The former MaSeR Corp. of Barrie, Ontario, Canada, closed its operations temporarily before reportedly being sold to a Singapore-based company.

The continuation of mandatory state electronics recycling systems, the start of new ones and the spread of manufacturer and retail take-back systems have helped keep material flowing into electronics recycling plants even in the slowest months the economy had to offer.

Providing a challenge to electronics recyclers, however, has been the price volatility of the scrap metal and plastic scrap markets. (To view the largest Electronics Recyclers, click here.)

MOVING ON UP

With the fate of obsolete electronics having received considerable attention from environmental activists, major media outlets and ultimately elected officials, the volume of electronics to be recycled has remained relatively steady through the recession.

The commodity markets have wavered (as they always do), but the growing economies of Asia have continued to consume scrap materials of every kind, including the metals and plastics commonly found in office technology, household entertainment and telecommunication products.

This steadiness on both the supply and demand side has allowed many electronics recyclers to continue investing in new equipment and new facilities and to enter long-term agreements to serve retailers, manufacturers, corporations and government agencies that generate electronic scrap.

Among those companies who have invested in new shredding plants is Fresno, Calif.-based Electronic Recyclers International (ERI, www.electronicsrecycler.com), which ranks second on the list.

John Shegerian, the CEO of ERI, says his company will continue to pursue volume growth in 2010. “In the U.S., we want to grow to have more shredder locations and more overall locations,” he says.

Part of what drives that decision, says Shegerian, is to be in a better position in the commodities trading arena. “From the commodities aspect, bigger is better,” he says. “It gets you more visibility and it gets you more credibility with the smelters. We have great relationships with smelters all over the world; that lets our clients avail themselves of better pricing structures.”

On the material supply side, he also touts the advantages of scale. “You have to be where your clients are in terms of geography,” Shegerian comments. If you have a national or eventually an international footprint, a worldwide manufacturing firm or retailer is more likely to work with you than if you’re a one-trick pony with one location.”

The companies ranking highest on the list each have a half-dozen or more locations. GEEP (www.geepglobal.com) and Intercon Solutions (www.interconrecycling.com) have 12, while Sims Recycling Solutions (www.us.simsrecycling.com) nearly matches them with 11 North American locations.

A FULL MENU

In addition to geographic range, offering a full range of services appears to be a common denominator among the largest electronics recycling companies.

A healthy majority of the 20 companies on the list offer refurbishing, component remarketing, data destruction and shredding services as a way to serve both customers who insist on complete destruction and those who prefer a maximum asset recovery value approach.

In its reply to Recycling Today’s listing form, Universal Recycling Technologies of Janesville, Wis. (www.universalrecyclers.com), offers a comprehensive service list it makes available to its customers: refurbishing/resale, component remarketing, data destruction, shredding, glass-to-glass recycling, asset management/asset recovery services, retailer recalls and returns, universal waste recycling (fluorescent lamps, ballasts, batteries, mercury-containing devices, etc.), pre-paid pack-and-ship box recycling programs and recycling equipment.

Broadening the types of materials accepted provides another way to increase volume and serve the greatest number of customers.

In its listing form response, ECS Refining, Santa Clara, Calif. (www.ecsrefining.com), notes that it has added IT and test/lab equipment and component remarketing to its menu of services.

ERI’s Shegerian says he sees opportunities in the portable consumer electronics stream as well as in larger appliances as logical next frontiers. “There is a huge opportunity in the smaller electronics such as cell phones and PDAs,” he says.

“We’re also getting more into white goods,” says Shegerian. “People are looking backwards now and realize we have legislated those out of landfills and incentivized them into recycling streams with programs like the EPA’s EnergyStar program,” he adds. “We expect to start specializing in that in 2010 and beyond.”

FAR FROM SETTLED

As electronics recycling firms have enjoyed opportunities from 2008 to 2010, a management task in front of company leaders has concerned certification.

As spelled out in the feature “Certification Maze” (April 2008 Recycling Today, starting on page 90), a combination of alliances and competing certification systems for electronics recyclers has evolved in the past several years.

Electronics recyclers are being courted by groups that include the Basel Action Network (BAN), the United States Environmental Protection Agency (EPA), the Institute of Scrap Recycling Industries Inc. (ISRI) and the National Association for Information Destruction (NAID).

NAID’s certification largely concerns procedures to protect and destroy confidential information contained within obsolete electronics as it makes its way through a chain of custody.

BAN’s e-Stewards certification program has its origins in requiring accountability for the handling of toxic materials. Certified companies are forbidden to ship toxic materials from developed to developing countries for recycling or for disposal.

The EPA has historically avoided certification procedures, but its R2 (Responsible Recycling) program has been set up to allow for outside audits from accredited companies. These auditors will report their findings to the American National Standards Institute-American Society of Quality National Accreditation Board (ANSI-ASQ-ANAB).

ISRI’s RIOS (Recycling Industry Operating Standards) can be obtained jointly with the R2 standards. ISRI bills RIOS as a quality, environmental, health and safety (QEH&S) management system to help recyclers manage processes and procedures. It pairs up well with the R2 certification that addresses downstream material shipping requirements, according to ISRI.

Electronics recycling company leaders have decisions ahead as they determine which certification system best suits their business model or company goals.

The authors are editor-in-chief and managing editor of Recycling Today. They can be reached at btaylor@gie.net and dtoto@gie.net.

* Figure is from 2007