March 2016
Key Success Factors for Optimizing Value Recovery in the eMaterials MarketMichael Blumberg, Blumberg Advisory GroupJoe Morrow, Belmont Trading Company
© 2016 Belmont Trading Co., Inc. All rights reserved.
Agenda
• The eMaterial Market and Challenges
• Criteria for Selecting an eMaterial Management Partner
• The Integrated Value Recovery Partner
• Integrated Value Recovery Case Studies
• Belmont Trading Company Overview
• Blumberg Advisory Group Overview
2
THE EMATERIAL MARKET AND CHALLENGES
© 2016 Belmont Trading Co., Inc. All rights reserved.
eMaterial vs eWaste
4
eWaste
Generally implies material that is:• Beyond Economic Repair
(BER) or End Of Life (EOL)
• Destined for lower-value recycling/metals recovery
eMaterial
Any electronic product that is transitioning from one use to the next, such as:• New in box equipment that an OEM never sold as new • Resalable used equipment even if it requires repair or
refurbishment to make it suitable for resale • Material generally referred to as eWaste: BER or EOL
material that cannot be used again due to obsolescence or damage.
In this presentation we use the most applicable term given the context of the topic we are discussing.
© 2016 Belmont Trading Co., Inc. All rights reserved.
eMaterial Value Recovery Drivers
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Maximizing Economic Value
Pursuing Sustainability
Goals
Complying With Regulations
Protecting Private Data
© 2016 Belmont Trading Co., Inc. All rights reserved.
The Growing eWaste Problem: 2014
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India, 4.1%
China, 14.4%
Brazil, 3.3%
Russia, 2.9%
Japan, 5.3%
Italy , 2.6%France, 3.3%
Germany, 4.3%
United States, 17.0%
UK, 3.6%
Top eWaste Producers (%age of Global eWaste)
1.4
4.4
7.0
8.5
17.3
18.0
21.9
22.1
22.2
23.3
0.0 5.0 10.0 15.0 20.0 25.0
India
China
Brazil
Russia
Japan
Italy
France
Germany
United States
UK
eWaste Generated per Capita (KG)
Source: http://i.unu.edu/media/ias.unu.edu-en/news/7916/Global-E-waste-Monitor-2014-small.pdf
© 2016 Belmont Trading Co., Inc. All rights reserved.
The Growing eWaste Problem: Trends
7
33.835.8
37.839.8
41.843.8 45.7
47.849.8
55.2
5.45.7
5.96.1
6.36.5
6.7
0
1
2
3
4
5
6
7
8
0
10
20
30
40
50
60
2010 2011 2012 2013 2014 2015 2016 2017 2018
Growth in Global eWaste Generation
E-waste generated (Mt) E-waste generated (kg/capita)
Total CAGR = 5.0%Per Capita CAGR = 3.7%
Source: http://i.unu.edu/media/ias.unu.edu-en/news/7916/Global-E-waste-Monitor-2014-small.pdf
© 2016 Belmont Trading Co., Inc. All rights reserved.
The Growing eWaste Problem: The Impact We Can Have
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Paladium, 0.05
Gold, 0.12
Silver, 1.24Copper, 8.44
What We Keep Out of Landfills(ounces per 100 phones)
Paladium, $27.25
Gold, $145.19
Silver, $18.97
Copper, $1.10
What it's worth(value per 100 cell phones)
Source: Shegerian, John, Triple Pundit, August 21, 2015
Total value per 100 cell phones: $192.51
© 2016 Belmont Trading Co., Inc. All rights reserved.
eMaterial Reuse & Recycling Options
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Lower Value
Recovery
Higher Value
Recovery
Scrapping & Recycling
Component Harvest & Resale
Remarketing Whole Units
Striving for higher value recovery options helps us achieve economic, sustainability, and regulatory goals
© 2016 Belmont Trading Co., Inc. All rights reserved.
Global eMaterial Challenges
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North America Latin America Europe Asia Africa
Canada:
• 7 provinces have recycling systems in place
• National-leveleWaste export controls
US:
• 25 states have (differing) laws on eWaste and recycling
• Limited national regulation
• Most countries have regulations and follow UN protocols
• Robust private-sector self-regulation, e.g. by MNOs who put in place take-back programs
• WEEE directive
• Local laws like PAS 141 in UK
• RoHS directive
• Battery directive
• Japan only country with formal laws
• Taiwan & S. Korea have well developed systems in place
• China has national regulation on imports and licensing
• India has no national law but some state laws
• Little governmentaction to speak of
• South Africa is building eWaste recycling infrastructure
Countries with regulations: 52Countries without regulations: 153
Source: http://i.unu.edu/media/ias.unu.edu-en/news/7916/Global-E-waste-Monitor-2014-small.pdf
SELECTING AN EMATERIAL MANAGEMENT PARTNER
© 2016 Belmont Trading Co., Inc. All rights reserved.
Evaluation Criteria for eMaterial Management Service Providers
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eMaterial Manager
Geographic Footprint &
Local Expertise
Vertical Market & Material Diversity
Breadth of Services Offered
Logistics & Processing
Capabilities
Remarketing &
Distribution Capabilities
Analytics & Reporting
Capabilities
These are the critical criteria to examine when evaluating the capabilities of any eMaterial management partner
© 2016 Belmont Trading Co., Inc. All rights reserved.
Evaluation Criteria: Geographic Footprint and Local Expertise
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Value Recovery
Goal
How Geographic Footprint and Local Expertise Helps Achieve It
Maximize Economic
Value
Diversity of resale markets maximizes value-in-use for materials
Maintains current knowledge of constantly changing local regulatory environment and demand trends
Pursue Sustainability
Goals
Deep knowledge of local markets allows greater transparency into the material’s second life
Comply with Regulations
Decreased risk of violating local regulations
What Is It?
Ability to deal with the global business challengesand their implications through:• Knowledge of local
regulations• Knowledge of local
markets & demand patterns
• Understanding of trade requirements & relationships between countries
• Local market presence
© 2016 Belmont Trading Co., Inc. All rights reserved.
Evaluation Criteria: Vertical Market and Material Diversity
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Value Recovery
Goal
How Vertical Market and MaterialDiversity Helps Achieve It
Maximize Economic
Value
Single point of contact for all eMaterial value recovery needs
Potential to cross sell components across product segments
Knowledge transfer between verticals
What Is It?
Breadth of vertical markets and material processing capability; may include:• Mobile devices• Computing equipment• Telecom equipment• Network connectivity
devices• Consumer electronics• Wearables• Batteries
© 2016 Belmont Trading Co., Inc. All rights reserved.
Evaluation Criteria: Breadth of Services Offered
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Value Recovery
Goal
How Breadth of Services Helps Achieve It
Maximize Economic
Value
One-stop shop for all processingservices you may need
Savvy partners specialize in services they are best positioned to provide and outsource others
Pursue Sustainability
Goals
The fuller the range of services provided, the more options for avoiding less sustainable practices (e.g. landfill disposal)
Protect Private Data
Secure, certified data erasure/ device destruction is one service your partner should perform in-house, with a strong track record of avoiding security breaches
What Is It?
The breadth of services a partner can perform on agiven device, such as:• Triage, sorting and
grading• Data wipe/destruction• Repair/refurbishment• Component harvest• Remarketing whole
units• Remarketing
components• Recovering precious and
other metals• Recovering other
materials
© 2016 Belmont Trading Co., Inc. All rights reserved.
Evaluation Criteria: Logistics and Processing Capabilities
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Value Recovery
Goal
How Logistics and Processing Capabilities Help Achieve It
Maximize Economic
Value
Lean, efficient, standardized logistics & processes reduce operating costs creating more value
Pursue Sustainability
Goals
Tracking of process metrics support demonstrates progress toward sustainability goals
Comply with Regulations
Standardized, documented processes allow clear demonstration of compliance
Protect Private Data
Efficient, mature, standardized QA processes reduce the risk of incomplete data wiping
What Is It?
Maturity & sophistication of logistics & processing capabilities:• Productivity vs. other
vendors• Logistics expertise and
partnerships in locations served
• Quality assuranceprocesses and certifications
• Process and technology standardization across facilities
• Metrics and SLAs measured and supported
© 2016 Belmont Trading Co., Inc. All rights reserved.
Evaluation Criteria: Remarketing and Distribution Capabilities
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Value Recovery
Goal
How Remarketing and Distribution Helps Achieve It
Maximize Economic
Value
Find both the highest price and the quickest payment for your material—then optimize the two to maximize value
Pursue Sustainability
Goals
The more remarketing options a partner has access to, the more capable they are of finding solutions aligned with customers’ goals
Comply with Regulations
The more country and channel options a partner has access to, the more capable they are of ensuring & demonstrating regulatory compliance
What Is It?
Breadth of market reach and depth of expertise in remarketing and distribution:• Insight & knowledge
into every viable market
• Direct presence in these markets
• Access to multiple channels and potential customers
• Proven track record of optimizing inventory turnover
© 2016 Belmont Trading Co., Inc. All rights reserved.
Evaluation Criteria: Analytics and Reporting Capabilities
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Value Recovery
Goal
How Analytics and Reporting Helps Achieve It
Maximize Economic
Value
Modeling & scenario planning to examine several variables to ensure processing and remarketing decisions are yielding maximal value in minimal time
Pursue Sustainability
Goals
Use data to demonstrate clearly where you are in relation to your goals
Comply with Regulations
Generate reports to demonstrate regulatory compliance
What Is It?
Ability to analyze and report against KPIs relevant to recovering value from eMaterial, such as:• The frequency &
thoroughness of reporting on recovery rates, revenue sharing schemes, and compliance levels
• Analytics to support procurement,processing, remarketing and sales decisions
THE EMATERIALS VALUE OPTIMIZATION PARTNER
© 2016 Belmont Trading Co., Inc. All rights reserved.
The eMaterials Value Optimization Partner
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eMaterials Value
Optimization Partner
Geographic Footprint &
Local Expertise
Vertical Market & Material Diversity
Breadth of Services Offered
Logistics & Processing
Capabilities
Remarketing &
Distribution Capabilities
Analytics & Reporting
Capabilities
Global
Multi-Vertical
Broad Services
High Process Maturity
Broad Reach, Deep Expertise
Robust Analytics & Reporting
The eMaterials Value Optimization Partner possesses advanced
capabilities along every dimension of our
framework
EMATERIALS VALUE OPTIMIZATION CASE STUDIES
© 2016 Belmont Trading Co., Inc. All rights reserved.
Case Study: Global, Diversified Telecom Equipment OEM
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Client
• Leading Europe-based telecom equipment OEM
• Operations in 120+ countries• Diverse portfolio of Telecom Network products
Integrated Solution
• Five providers (including Belmont) partnered to provide solution
• Services span remarketing, recycling, logistics management, and CO2 offsetting for all the client’s products across all 120+ global locations
• Resale values increased over those attained by prior partners
Client Situation
• Required diverse set of services, from remarketing to recycling
• Operated in 120+ countries with 47 vendors—goal to minimize vendor count
• Required customized services based on product type, country, and optimal value recovery strategy
© 2016 Belmont Trading Co., Inc. All rights reserved.
Case Study: Global, Diversified Telecom Equipment OEM (Continued)
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eMaterials Value
Optimization Partners
Geographic Footprint &
Local Expertise
Vertical Market & Material Diversity
Breadth of Services Offered
Logistics & Processing
Capabilities
Remarketing & Distribution Capabilities
Analytics & Reporting
Capabilities
Capabilities Demonstrated
Local expertise or partnerships in all
120+ client countries
Consistent processes across all facilities serving the 120+ countries
Improved resale values by leveraging global network to find optimal resale markets and channels
Ability to process all types of telecom
material
Including remarketing, recycling, logistics management,
and CO2 offsetting
Tracked and reported on client KPIs globally
© 2016 Belmont Trading Co., Inc. All rights reserved.
Case Study: Latin American Mobile Device Trade-In Program
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Client
• Leading LATAM mobile network operator• Diversified service portfolio includes mobile phones, cable TV, broadband, mobile payments
• Operates online eCommerce site and a network of retail stores
Integrated Solution
• Partnered with client and in-store processor to develop end-to-end trade-in program
• Integrated Value Recovery Partner manages all out-of-store logistics
• Leverages Colombia facility for device collection & processing
• Leverages Dubai and Hong Kong facilities for international remarketing
• Leverages U.S. facility for recycling devices that can’t be remarketed
Client Situation
Sought partner to run online and in-store mobile device trade-in program and provide:• Maximum recovery value by selling phones in
optimal markets (domestic or international)• Maximum velocity of cash conversion• Minimum environmental impact• Compliance with strict Colombian regulations
© 2016 Belmont Trading Co., Inc. All rights reserved.
Case Study: Latin American Mobile Device Trade-In Program (Continued)
25
eMaterials Value
Optimization Partner
Geographic Footprint &
Local Expertise
Vertical Market & Material Diversity
Breadth of Services Offered
Logistics & Processing
Capabilities
Remarketing & Distribution Capabilities
Analytics & Reporting
Capabilities
Collection & Processing: Colombia
Resale markets: Colombia, Dubai &
Hong KongRecycling: U.S.
Belmont handles end-to-end logistics, sorting, grading,
repair, and remarketing
Integrated processing and logistics across 4+ countries (Colombia, US, Dubai, Hong Kong)
Belmont remarkets devices on both B2B and B2C channels in Colombia and globally via Hong Kong and Dubai
Capabilities Demonstrated
© 2016 Belmont Trading Co., Inc. All rights reserved.
Case Study: Maximizing Value and Minimizing Environmental Impact of Russian eMaterial
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Client
• Western-Europe-based global telecomcompany with customers in more than 180 countries
• Strong corporate focus on sustainability and finding highest-value “second life” for eMaterial
Integrated Solution
• Based on local expertise, determined an export route to move the equipment from Russia to an intermediary country, then to Sweden for resale in the EU
• Belmont handled all the logistics for the operation, leveraging its own office in Moscow and processing facility in Sweden
Client Situation
• Routinely installs and de-installs equipment for clients in 180 countries
• Had high-value telecom inventory in Russia • Exporting equipment for resale has many costs and legal complexities
• No resale market for the equipment in Russia; only option was to scrap it, with obvious negative environmental impact
© 2016 Belmont Trading Co., Inc. All rights reserved.
Case Study: Maximizing Value and Minimizing Environmental Impact of Russian eMaterial (Continued)
27
eMaterials Value
Optimization Partner
Geographic Footprint &
Local Expertise
Vertical Market & Material Diversity
Breadth of Services Offered
Logistics & Processing
Capabilities
Remarketing & Distribution Capabilities
Analytics & Reporting
Capabilities
Knowledge of local laws in all European countries, facilities in Sweden & Russia
Logistics management across three countries
Ability to take ownership of material, export from Russia to Sweden, remarket across EU
Capabilities Demonstrated
BELMONT TRADING COMPANY OVERVIEW
© 2016 Belmont Trading Co., Inc. All rights reserved.
We are passionate about creating sustainability solutions for used electronics equipment
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Belmont Trading Company exists to make our
world sustainable for future generations by
creating responsible and ethical solutions
for managing and recapturing value from
used electronic equipment in every global market
Reducing the proliferation of eWaste
With 10 facilities on 4 continents we are well positioned to localize processing and
remarketing solutions for our partners
Our focus materials include computing, mobility, network
telecom, batteries & accessories, and a range of other electronics
28 year history of growth of innovation for its
business partners
Meeting or exceeding local governmental
and NGO standards
Maximizing value returned to customers
BLUMBERG ADVISORY GROUP OVERVIEW
© 2016 Belmont Trading Co., Inc. All rights reserved.
Experience and Credentials
• Full service management consulting firm specializing in the Aftermarket & Reverse Logistics Service Industry:
- Reverse Logistics & Returns Management
- Depot Repair & Field Service
- Service Logistics
- Tech Support
- Asset Recovery & Liquidation
- E-Waste & E-recycling
• Founded in 1969
• Headquartered in suburbs of Philadelphia, PA
• Practice areas include:
- Strategic & Business Planning
- Market Research & Customer Satisfaction
- Benchmarks & Best Practices
- Productivity & Efficiency Improvement
- Systems Design, Evaluation, & Recommendation
- Mergers & Acquisitions
• Broad Industry Focus
- IT/Telecom
- Consumer Electronics & Appliances
- Medical/Scientific Instrumentation
- Process Control & Plant Automation
- Building Controls & Automation
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© 2016 Belmont Trading Co., Inc. All rights reserved.32
Questions & Answers
© 2016 Belmont Trading Co., Inc. All rights reserved.
Thank You!
33
ContactBelmont Trading Companywww.Belmont-trading.com
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