[b]$EWSI acquisitional strengths. PPS Undervalued[/b]
I posted this at that other board for the bashers to pawn over for a while. Solid personal DD seems to throw them off their game for a bit and makes them argue facts vs. their usual flaming baloney bashing.
As an E-Waste industry "Expert", I get lots of questions on why EWSI is doing certain acquisitions. Here is a synopsis of what I wrote on two of them.
I have been in the SURF facility in SO. Cal. Remember the recycling triangle? Reuse, Reduce, Recycle. All quality E-waste recycling companies that are R2 need to maximize the reuse possibilities for all electronics.
http://asoft10298.accrisoft.com/r2solutions/r...-standard/
My point is that every facility does not have to be a heavy destruction facility in the EWSI model. SURF is more of an asset recovery/reuse facility. While they do properly handle end of life, the SURF model is considered to be the first step in E-Waste recycling. Capture all the useable materials you can and recycle the rest. As they are a laptop specialist, they generate, all sorts of working parts for resale. The value of a working motherboard is exponentially more valuable than the recovery value of the smelted metals. As EWSI further integrates SURF, they may start to utilize and expand the facility to handle more destruction as opportunities arise. This would take a larger footprint and better logistical flows, but it could be done. Keep in mind that when done properly, Asset Management can be the most profitable part of an E-Waste recycler's business.
My two cents on SURF is to utilize the expertise in asset recovery and capture materials that have some recovery potential there from the West Coast. As the material flows expand, add more downstream processing capabilities, or open a facility in Mexico for more manual separation at a better labour rate.
I've also never been a gigantic fan of first-pass mechanical separation, i.e. shredding ewaste. Once you toss something down a shredder, there's no going back. Plastics, metals and all sorts of things are co-mingled and unrecoverable. Shredding should be only done to reduce the size of homogenous materials. Some of the worst e-waste recyclers are shred first, separate second operations, and their collateral waste is too high, in my opinion. In some logistical circumstances (moving material to another location costs outweigh the benefits), there is a need for mechanical, but manual should come first.
Who cares about plastics and other items?
Why 2TRG? The industry has much more to do with forming the proper upstream and downstream partnerships as it does with having ten dozen physical locations at the onset. The single biggest line item in a waste hauler P&L is the transportation cost/processing facility relationship. As you put the pieces together, you need the flexibility to contract locations for processing that are in geographical reach of the materials processed. Hence all the JV's and other paper deals. You can make lots of revenue in this industry by having the correct geographical reach for the deal. As downstream partners process material, and the volume stays steady or increases, it then behooves EWSI to stock swap for the physical location.
Why did EWSI choose the first deals in or near Columbus and Cincinnati? Why are these cities hubs of Distribution? Because 50% of the US population resides within 600 miles. This is ONE day of trucking. EWaste has to be consolidated and moved before it can be processed. It appears the 2TRG deal may actually have been thought out…. Who knew?
There are currently 482 R2 Certified Recyclers in the world. 2TRG is on the list. Have a look.
http://www.r2solutions.org/certified/electron...acilities/
You will NOTE that 2TRG is at the TOP of the page in the middle.
E-Stewards is a substantially more challenging standard. I didn't count, but here they are
