Creating a reverse logistics ecosystem

HP Brazil & Sinctronics Creating a reverse logistics ecosystem

Overview

The Need: an estimated 50 million tons of electronic equipment is discarded every year globally, a figure increasing 17% a year due to lack of reverse logistics and remanufacturing initiatives.

The Solution: combine HP’s outreach capacity to establish a robust reverse logistics scheme with Sinctronics’ capacity and expertise to recover and create value out of HP end-of-use electronic equipment.

What makes it circular? Design decisions happen in one company, while production is carried out by another - forming a partnership has been fundamental to create feedback, exchanging information on practical feasibilities that are key to increase circularity.  

The Benefits: collection times reduced by 50%, costs reduced by up to 30%, and 97% of the collected materials and components reincorporated into Sinctronics’ supply chains.  

The partnership between HP and Sinctronics has brought about the first circular economy initiative in the Brazilian electronics sector. HP has considerable manufacturing operations in Brazil and have set themselves a zero waste to landfill ambition through the adoption of a circular economy strategy. To help achieve this, HP has formed a partnership with Sinctronics, which has facilitated the development of processes to increase the volume of recycled materials into new products and packaging.

In 2008, Flex became the manufacturing partner of HP Brazil. Flex offer design, manufacturing, distribution and aftermarket services to original equipment manufacturers globally, and worked with HP Brazil to provide one facility to support the whole HP product portfolio in the country and improve efficiency and synergies in the supply chain.

Working side by side

The circular economy is driving a new approach to business around the world and will transform the way the economy produces and consumes goods and services. Flex and HP, as market leading companies, have embraced this idea as a way of creating value for their business, customers and society. From these common goals, Sinctronics was created in 2012 as the first unit of Flex to provide recycling solutions for the IT sector. The idea was to apply industrial standards and expertise into the recycling process, thereby scaling circular economy solutions. Sinctronics business objectives seek to generate value by providing a full portfolio of services and solutions that goes from a reverse logistics management system to providing technology that helps incorporate recycled materials into new pieces and parts of IT products.

The creation of a Recycling and Innovation Center next to the manufacturing site was an important first step in understanding and re-thinking the product cycle. Cross-company communication allows for the most up to date knowledge on disassembly to be disseminated among all fields of expertise. It also enables Sinctronics to share practical insights with HP, seeking to influence and enhance their design decisions and identify new opportunities to create a closed loop process between manufacturing and recycling end-of-use products. For both companies, designing products and services that enable circular economy applications is a business opportunity. Sinctronics is committed to stimulating the development of recovered materials markets by using recycled content in new HP products.

The manufacturing of the future has already begun, and it has the potential to reduce the impact on the environment, create jobs and wealth at the same time.

- Carlos Ohde, Sr Director Innovation and New Ventures, Sinctronics

One of the specific goals of the partnership between HP and Sinctronics was the development of a closed loop process for plastics recovered from HP end-of-use products. After a lot of research and interaction between engineering and technical teams of both companies, the initiative achieved a breakthrough. The R&D process led to the development of recycled white plastic, to be used in electronics products, which satisfied the high-quality criteria and cosmetic appearance required by HP. The process to obtain the white plastic is very rigorous, as any contamination in the final recycled plastic will change the purity of the white colour required. The recycled white plastic used is made of at least 94% recycled plastic and up to 6% pigments and additives, to achieve the purity of 96% required by HP.

Raising ambition

The average level of recycled material in HP Brazil’s products currently sits at 8% , and the aim for 2017 is to increase this to 20% as part of the company’s circular economy strategy. However, this will require an increase in the collection rates of end-of-use products or even the use of post-consumer plastics from other sectors. As well as reducing waste and creating added value, the strategy can also lead to environmental benefits such as a reduction in GHG emissions.

Through the program, 97% of materials collected by Sinctronics is now recovered to be directly returned into the supply chain. A proportion goes back into HP products while the remainder, for example materials such as metals, join other local supply chains. For HP, this outcome not only helps accomplish its circular economy goals but also bring costs reduction and less volatility across the supply chain. For Sinctronics, the project created an expertise in reverse logistics integrated into industrial strategy that can enable a decrease of its client costs up to 30% and in collection time for end-of-life products by 50%.