This report presents the results of the Revertia case study, selected in the framework of the R2PI project, among 17 other cases, because of its focus on an activity linked to priority areas of the Circular Economy, namely Plastics and Critical Raw Materials. The information contained in the report is based on the methodology designed within the framework of the R2PI project to understand the characteristics of the business model, evaluate its outcomes and identify the main barriers and enablers of the CEBM.
Revertia is an authorised Waste Electrical and Electronic Equipment (WEEE) manager that combines e-waste management services with a circular value proposal consisting in the preparation of IT equipment for reuse. The company responsibly manages an e-waste flow and, by applying secure reconditioning processes, is able to extend the service life of IT equipment that has been discarded. Refurbished equipment, with a 1-year warranty, are sold in second-hand markets or donated. The activity of preparation for reuse also involves the utilization, to the extent possible, of used and recycled components. In addition, the business model is based on efficient logistics, avoiding e-waste transportation when reconditioning is not an option.
The value proposition is based on the provision of high added value services to corporate IT equipment users, who need to manage their WEEE responsibly. The value network is thus formed by the origin-customer that generates e-waste and the EEE manufacturers represented through collective schemes. Downstream there are the destination-customers of second-hand and donated products, as well as the WEEE recycling companies to which Revertia's own waste is destined.
Revertia's business model is clearly influenced at the context level by the WEEE Directive 2012/19/EU and the Spanish RD 110/2015, which regulate the industry and set targets for reuse and recycling of WEEE. In addition, the market context given by the rapid technological change in the EEE sector, the collective schemes derived from the implementation of the EPR obligation, the maturity of the WEEE recycling industry, the existence of illegal scrap metal agents, and some socio-cultural aspects such as the lack of awareness of WEEE's environmental costs are factors that strongly affect Revertia's activity.
The report also presents an assessment of the circularity of the business model. The model corresponds to the Re-make pattern among the CEBM defined in the R2PI project. Its circularity lies in extending the useful life of a product, also integrating used and recycled components as far as possible. Current circularity is limited, since it is not based on services added to this second-hand product, nor is the organisation further able to act on the products manufacture or end of life. Therefore, Revertia takes opportunity of a gap left by other players in the sector (EEE manufacturers). Therefore the business model is dependent on the generation of an e-waste flow as well as on sales of refurbished computers.
With regards to the outcomes assessment, the main advantages of the business model are found in the non-financial aspects: reuse of IT equipment for the same use demonstrates clear environmental benefits compared to recycling. In addition, it also allows for greater local employment generation linked to the management and preparation for reuse activity. In the socio-economic area, second-hand products provide access to quality equipment at very affordable prices.
The SWOT analysis shows that the main strengths are the long-lasting and stable relationships with the origin-customers, the know-how and expertise of Revertia. The weaknesses point to its dependence on the linear model, therefore, to being able to capture waste streams, in competition with the mature recycling industry. The opportunities lie in the Spanish regulatory framework, which sets targets for the reuse of WEEE, as well as a state of opinion more favourable to responsible and sustainable consumption; however, there are also clear threats to the model, such as the possible entry of more competitors and the lack of sensitivity of EEE manufacturers towards reuse.
Based on the analysis, it is concluded that the Re-make CEBM is replicable and transferable, especially as long as the linear economic paradigm is dominant. However, there are a number of business and policy recommendations that may support greater circularity: first, specific agreements with EEE manufacturers to extend circularity from the conception of EEE products until its final disposal after multiple lifetimes; second, at the policy level, tighter regulation, with inspection and sanction systems, incentives for eco-design and product life extension activities, transparent information and monitoring systems, as well as education and training measures are neededThis project has received funding from the European Union’s Horizon 2020 research and innovation programme under grant agreement No. 73037
