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Survey: E-scrap industry holds dim view of current business climate

Posted at October 5, 2015 » By : » Categories : Latest News » Comments Off on Survey: E-scrap industry holds dim view of current business climate

Article by: E-Scrap News

Researchers recently asked over 200 electronics scrap reclaimers how they feel about the state of the electronics recovery business. The response: These are dark days. Welcome to E-Scrap 2015

“We heard from about 75 percent of our respondents that they feel the industry is either staying the same or declining. That’s a pretty significant change over the last few years,” said Anne Peters, president of Gracestone, Inc. “Our respondents reported that the industry is under pressure due to commodity prices and the uncertainties in the global market.”

Peters and Libby Chaplin, CEO of Arcadian Solutions, presented on the results of a survey at E-Scrap 2015 in Orlando, Fla. last week. The survey focused on what effects certifications and standards are having on the industry as well as the business climate as a whole. It was the third time they had conducted the survey.

Only 24 percent of respondents in 2015 said they saw the number of companies in the industry growing, while 41 percent said the number was declining and the rest said it has remained about the same, according to their presentation.

An even smaller percentage (12 percent) said they saw industry-wide profitability increasing, while 55 percent said it was decreasing and the rest said it has remained about the same.

Peters told session attendees they heard continuing concerns about the persistent flow of CRTs, which respondents ranked among the most pressing issues.

“Clearly we’re not done with the CRTs and that pig in the python isn’t through the python yet,” she said.

The researchers have seen a shift toward the refurbishment and resale market, because that side of the house isn’t as affected by low commodity prices, Peters said. They also see more competition for higher-metal-content scrap from higher-end businesses, including telecommunications companies.

They expect some of the companies entering the market during the good times will close during this downturn, she said. And manufacturers may feel added pressure to pay higher fees under state extended producer responsibility programs.

Researchers also heard companies find it harder to justify maintaining the expense of certifications as profits decrease, Peters said.

At the same time, the survey showed the industry sees value in certification programs. For example, 84 percent of respondents said certifications add some level of value to their businesses, and 93 percent said they add some level of value to the industry as a whole, according to their presentation.

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