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Future of Commerce

Let's Talk Reverse Logistics for a Better Environment

Stephen Beard, VP of Network Development, FLEXE

We talk a lot about commerce and how the way we shop has changed. But as modern-day consumers decide among the myriad ways in which they can make a purchase, the quality of reverse logistics—convenience, cost, replacement options—plays an increasingly important role.

We live in a technology-focused world that is increasingly aware of the effect we’re having on our environment. Often woven into the returns process, recycling electronics is one major concern—nobody wants all that stuff ending up in a landfill. The ongoing transformation of the retail industry needs to include a greater focus on “greening” the supply chain.

For smaller and inexpensive devices, the challenge of recycling is far greater than that for an old computer or television. Bigger items can be refurbished, resold, or have its parts harvested, which means you often get paid for returning one. With smaller and inexpensive devices, the incentives are less compelling. There’s likely no way to salvage them or provide cash back.

At Tile, we face this challenge first-hand. In the past, we tried to make it easier for our customers to recycle by sending them a prepaid return envelope when they order a replacement Tile. They would send us their old device that we would then forward to a certified recycler. However, paying first-class mail on hundreds of thousands of transactions can become very costly. And while intending to be green, flying a device across the country to our warehouse isn’t the most environmentally-sound option. Many companies that manufacture wireless mice, keyboards, webcams—anything fewer than $40 dollars—face the same challenges. We knew that there had to be a better way.

The ongoing transformation of the retail industry needs to include a greater focus on “greening” the supply chain.

Instead of us piecing together our own solution, what if we coordinated with local e-cycling centers? What if we created a collaborative, green supply chain among retailers, manufacturers, and public service agencies? There are hundreds of local e-cycle centers in every major metropolitan area. What if we could direct our customers to their local center? If there was a database of these centers, we could make it easily available to our customers to let them know that there’s a Best Buy two-tenths of a mile away that accepts e-waste.

Unfortunately, we found after extensive research that this database doesn't exist. Various recycling groups publish lists of their own association members, but the lists aren’t connected to each other, making information disparate and difficult to aggregate for customers. Furthermore, we weren’t really interested in recycling processors. We wanted e-waste drop sites, which are far more plentiful than processors. So, the first step was creating that database. But how?

As a fast-growing, but small company, we knew we couldn’t do it alone and that we’d need to partner with other teams to get such a big project done. So we solicited the help of the Reverse Logistics Association (RLA) and Total Technology Results. Total helped complete the research for all current e- waste sites across retail and municipal channels in all 50 states. They put all that data into a format conducive to an API-accessible database. RLA, the largest global trade association for the returns and reverse industry, will host and maintain the database, making it accessible to their member organizations comprised of leaders in the consumer electronics and retail space. Tile will be the first user of the database, integrating the functionality into the Tile app, which will roll out later this year. Other companies are sure to follow as access to this database is being offered free of charge.

Consumers are demanding that electronics makers take better care of the environment and keep more of their used gadgets out of the ground.

Developing a better system for e-cycling is good business for everyone involved. If I'm walking into a Best Buy with a dead device that I want to drop off, there's a good chance that I want to buy a replacement. From a reputation perspective, manufacturers have even more to gain than retailers. When someone posts a Facebook photo of a pile of dead devices, it isn’t Best Buy's brand that’s tarnished, it’s the brand of the OEMs.

As an industry, it’s important for us to show we’re not waiting for a regulator to come and set standards for us. We want to be a company that is proactively addressing this problem. Consumers are demanding that manufacturers take better care of the environment and keep more of their used gadgets out of the ground. They’ve made it clear that they will reward the companies that do—and shun those that don’t.

I’m optimistic that we’ll get to a better system for handling e-waste that helps customers feel better about the products they buy. And I’m happy to be part of a team leading the effort and sharing it freely across the industry to make the consumer electronics space a little greener for all.

Tell Us More

What’s one piece of advice you’d give that you’d follow?
For an OEM looking to succeed in retail, invest time and effort up front to develop a bulletproof retail compliance program. Too often, the deal is done and execution is an afterthought, with logistics hastily thrown together against a tight deadline. Get your compliance program built before you have retail routing guides, choose a 3PL with experience shipping to retailers, borrow best practices from their experience, get work instructions in front of operators while they prepare your order, and make sure compliance is part of the 3PL QC audit process. Poor compliance with retail routing guides will eat all your margin from these relationships, and then some.

What’s something we, as an industry, aren’t talking about that we should be?
I could see a future where geo-fencing and technology that allows retailers to individually engage shoppers as they enter the store using smart tags (like a Tile) or opt in proximity sensing on your smart phone app, that would allow for micro marketing to the individual.

What’s a product that you now buy online but thought you never would?
I’m a musician and used to always need to look at my gear and talk with the sales staff about effects pedals and other music gear. With online research and reviews available so readily online, I now buy this kind of thing online without reservation.

What’s a product that you now don’t think you’ll ever buy online?
I’ll never buy shoes or clothes online. I want to know how the material feels and how the item fits me. Sizing charts are imprecise and different brands wear larger or smaller than others.

You’re a new addition to a crayon box. What color are you?
I’d be the box that holds all the other crayons together. I may not be flashy, but I’m necessary.

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Stephen Beard

VP of Network Development | FLEXE