Applying sustainability to something as complex and often globalized as a supply chain can be challenging. But it needs to be done.
Mounting environmental pressure from regulators requires that original equipment manufacturers (OEMs) consider means for establishing green supply chain practices.
A green supply chain involves incorporating environment-friendly initiatives into every aspect of supply chain activities. It encompasses sourcing, product design, manufacturing, transportation, disposal and post-sales services, including end-of-product life management.
France passed the Anti-Waste for a Circular Economy Act (AGEC), which aims to reduce plastic consumption and encourage reuse and recycling. Since January 2021, some French businesses have been displaying a repairability score for their products to comply. The law applies to smartphones, laptops, televisions, washing machines, and lawnmowers.
But it’s not just from the regulatory side that pressure is growing. Other stakeholders are also demanding more sustainability from companies. Today’s consumers, for instance, no longer see sustainable products as a simple alternative. They are basing their purchasing decisions on the sustainability of products and companies.
Organizations that promote green supply chain practices are more likely to meet consumer expectations and bolster their manufacturing competitiveness. On the flip side, companies that can’t meet the growing directives to green their supply chains will see their businesses suffer.
There are many strategies OEMs and EMS providers can use to drive sustainability within their supply chains, such as creating a circular economy, enhancing supply chain visibility, and fostering collaboration across the supply chain.
An emerging approach toward a green supply chain involves creating a circular economy. The goal is to minimize resource consumption and waste by extending the useful life of electronic components. One way to achieve that goal is to optimize a product’s durability and performance during the design stage and provide a viable pathway for the part’s reuse or recycling at the end of life. Companies, for instance, must consider the obsolescence risk associated with component life cycles when designing a new device. The rapid developments in the electronics space mean that components are discarded quickly, even if they are new and unused, opening the avenue for a potential e-waste build-up. In addition, consideration should be given to the product’s engineering modularity so that parts can be easily disassembled and shipped for reuse.
As sustainability moves up the corporate priority list, OEMs and EMS players are investing more in after-sales and end-of-life services. Attention is turning to preserving the value of electronics to avoid incineration or disposal of used components into landfills. This concept is visible through trade-in, and recycling programs manufacturers have initiated to help improve sustainability across their supply chain.
For example, Samsung allows customers to trade in their old devices in exchange for brand new mobile phones. Apple is also implementing a Self Service Repair initiative that gives customers access to iPhone 12 and iPhone 13 parts and tools. Other manufacturers have recycling services that offer various incentives, giving consumers the option to extend the life of their electronics instead of discarding them.
Better visibility and control translate to clearer paths for companies determined to green their supply chains. It is much easier to integrate downstream operations in order to gain more control of the distribution and destination of your components. To that end, OEMs will need to invite and incentivize distributors to disclose information such as which distributors sell components to and whether the disposal of the components meets set standards. Such visibility opens an excellent opportunity for manufacturers to trace the lifecycle of their products and reduce the risks of components being counterfeited or discarded. It also ensures that products reuse and recyclability are directly within the firm’s control.
Achieving a green supply chain also requires collaboration with business partners to further your sustainability goals. Supply chain collaborations rely on many players acting together to affect change. For OEMs, this implies working closely with EMS providers and other suppliers to improve operational footprint and realize gains across the entire supply chain. Those might come from joint initiatives on sustainability, expanding business reach to support ethical sourcing, or supporting clients’ post-sale services like repairs and exchanges. They can also share information with other companies along the supply chain to ensure suppliers are doing the same. Without transparency among partners, moving towards a greener supply chain might be difficult.
One of the major stakes within the electronic components market is not only the way electronic products end of life is handled by organizations, but also the way electronic components are managed at the beginning of the product lifecycle. Indeed, the amount of discarded unused electronic components represents billions of dollars.
At AIRENC, we empower OEMs and EMS companies to build green supply chains by facilitating circularity within the electronic components sector. We have created a community-driven marketplace that enables OEMs and EMS to give their unused components a second life according to their sustainability goals, avoiding them to be stockpiled and even discarded. Also, if a component has gone obsolete for your products, you can find buyers interested in it on the AIRENC platform and sell it at a fair price.
Proper care is taken to ensure that you sell only to registered members and carefully vetted buyers, so you can be sure where your components are going. With the help of an intuitive dashboard and live notifications, clients can see the progress of their transactions and make efficient decisions while selling components.
Finally, in situations where components fail to find any buyer on our platform, we help our clients to recycle those unused components through our network of partners dedicated to electronics recycling. Retrieved parts can then be refurbished or recycled, giving them a second life in a closed loop system.
Say goodbye to being railroaded by cheap brokers. Leverage AIRENC platform to enhance traceability and reduce the risks of your components being counterfeited ending up with your competitors.
If you want to know more about how AIRENC transform your supply chains, don’t hesitate to contact us.