Model-based analysis of capacity and service fees for electronics recyclers

Abstract

By 2010, billions of discarded electronics will require recycling due to concerns over data destruction and electronics recycling legislation. Unlike manufacturing planning that seeks to meet finished goods demand, recycling planning must meet recycling service demand to accept end-of-life electronic products. Motivated by actual electronics recycling problems that were observed, a short-term bulk recycling planning model was developed to determine what products to accept, process, and reprocess. Using data collected from electronics recyclers, an experiment was run including eight scenarios on the analytical recycling planning model that vary the processing capacity, service fee, and storage capacity. Although the results demonstrate that recyclers may improve their material revenues with reprocessing and selection of key product groups, the material revenues do not cover the total costs. Products with higher service fee-to-weight ratios and material output revenues are more attractive for recyclers to accept. Service fee revenues are necessary to cover overhead costs such as capital equipment purchases, administrative costs, and logistics costs. The modeling scenarios also indicate that recyclers could benefit from greater processing and staging space capacity to accept more products that generate service fee revenues and, upon processing, generate material revenues.