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An Introduction to Entrepreneurship in Solid Waste Management

An Introduction to Entrepreneurship in Solid Waste Management
Municipal solid waste in India; Source: thehindu.com

Municipal solid waste in India; Source: thehindu.com

There is no such thing as an infinitely durable product. The world’s current consumption, in the form of various goods, must end up in the waste stream and the onus is upon us, either to innovate in the field of Solid Waste Management (SWM) or to keep continuing the existing polluting methods of solid waste disposal. However, this field has lot of challenges and it takes persistence and providence to overcome them, as the root of the problem mostly lies in the mindset of the people. To solve this global challenge, smart minds need to come up with innovative solutions. But as one of the panel members put it, this field is not sexy enough for the smart minds. The panel members are Tom Szaky, founder of Terra Cycle and Bilikis Adebiyi, founder Wecyclers Corporation. Together they brought a cumulative experience of more than 15 years in the field of solid waste management. They brought great insight and critical analysis of the opportunities, challenges and risks that confront the area of SWM. Growing entrepreneurs have a great deal to take away from the discussion. Unfortunately, there was not enough time to discuss some other aspects of solid waste management. The aspects will also be discussed here.

Fundamental aspects of entrepreneurship:

Entrepreneurs in the field of SWM should realize the fact that, this field is no exception and it all boils down to economics. Constant flow of revenue is needed to make projects sustainable. And who knows the meaning of sustainability better than the people who work in SWM and environmental protection in general? The revenue can come in the form of payments made for services offered or through funds from national and international governments, corporate, philanthropy and other welfare organizations under various programs. As one of the panel members puts it, entrepreneurs should be imaginative and far-reaching in securing funds from foreign sources, and this can be debated as one positive aspect of globalization and the information era. When relying on funds, a proper risk analysis should be conducted and alternative sources should be tapped for continuous and timely availability of funds.

Source: 44 minutes
Video panel on entrepreneurship in solid waste managament

Contributors:

Author:

Editors:
Carine Abouseif 

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Three-step process: How not to fail in SWM:

While success in this field or any other entrepreneurship cannot be guaranteed, there is a three-step process in setting up a sustainable or successful value chain in SWM. Infrastructure, awareness and incentives are the most important steps in this strategy and should be handled with utmost care.

Before dealing with each one of these, knowing what constitutes solid waste is essential.

Constituents of Solid Waste:

Waste composition depends on various factors like type of economy, cultural & social habits, etc. and varies from place to place. The composition of waste has a major impact on the type of technology and infrastructure that needs to be installed. The cultural and social habits of an area should have a major impact on the strategic approach that needs to be taken to spread awareness and on the approach to creating incentives.

Solid waste or municipal solid waste can be broadly classified into organic, degradable waste (fruits and vegetables, food waste and garden waste), inorganic, recyclable waste (paper, cardboard, plastic, glass and metals), and medical, sanitary, electronic and hazardous waste (solvents, chemicals, etc). Each constituent can be handled or disposed of through multiple technologies or processes and proper care should be taken while searching for the appropriate process. Technologies which can handle solid waste on a wholesale basis are also available, like land-filling or incineration. They are by far the most preferable ways of waste disposal.

Powerpoint 1-Slide1

There are entrepreneurship models for each constituent of solid waste and each model requires varying degrees of infrastructure, awareness and incentives. It should also be noted that currently only inorganic and recyclable wastes like paper, cardboard, plastics (only rigid PET and rigid HDPE), glass and metals (aluminium, iron & steel, etc.) and some electronic waste has economic value. All other wastes are considered as liabilities.

Infrastructure:

When we talk about infrastructure in SWM, we’re talking about the logistics mechanisms between the waste producer and the waste processing facility. The processing facility and the logistics mechanism should work in tandem and they cannot exist with out one another.

Waste recycling mechanisms:

The kind of waste that is going to be produced is determined the moment a product is made. A typical value chain of a product consists predominantly of the following stages: consumers, retailers, wholesalers/distributors, manufacturers and component/raw material suppliers. Waste is generated at every stage of the value chain, but disposal methods for solid waste generated at the customer consumption stage are only discussed.

The type of waste generated by the customer can either be sent to a totally different waste processing facility or it may be of particular value at one stage of the value chain or the other. Hence, it will be prudent to explore all the options to establish simple and efficient waste recycling mechanisms.

Some of the examples quoted by Tom of Terra Cycle in this regard are that of National Cigarette Recycling Program, which is funded by the cigarette manufacturer Philip Morris. In this program cigarette stubs are collected at various locations or are directly sent by the cigarette consumer to the recycling center. In another case a retailer, Staples Inc. the office supply chain store provides recycling for binders.

One thing that should remembered is that recycling programs will be funded by those who will benefit from implementing the programs. In the case of Staples, implementation of the program led to increased foot falls. In the case of Philip Morris, the strategy increased brand awareness and presented the company as responsible. In another case, a hazardous product distributor was interested in a recycling program as it eliminated the burden of waste processing from its buyers and helped to increase sales. Again, as Tom of Terra Cycle puts it, we need to look at the waste stream and identify the point, where the value of the waste peaks.

Infrastructure sharing mechanisms:

To handle the operations part of the recycling program resources, in the form of infrastructure and labour, are required. In some cases, resources can be provided by waste management companies who offer to provide their services in transporting waste to the recycling centers, or by brand partners who subsidize collection services or centers. Government organizations and local municipalities should not be expected to provide capital investments, but they are a great resource for labour and infrastructure. In one case, a city leased electric poles, which were used as cigarette collection points, as well as schools, hospitals, police stations and other public places to spread awareness of the project, and employed 800 people for the day-to-day operations of the project. Here ingenuity lies in identifying unique resources that can be pledged easily by each of the involved stakeholders, as mentioned by Tom Szaky.

Awareness:

The real challenge lies in making a person aware of the problems associated with solid waste management. Infrastructure without awareness is a mere waste, but if people are aware of the problem and are really motivated to contribute to the solutions, even a lackadaisical infrastructure can do wonders.

Spreading awareness and getting people to recycle is a tricky job. Knowing things is different from doing things. Children can be taught easily and can be molded to recycle waste. But teenagers and adults are very tough to change, if not stubborn. Awareness about solid waste management should start from an early age in schools and rules should be enforced strictly. Solid waste management should be an involuntary action and a habit.

On another note, people in developing countries, may never seen their cities clean. This aggravates the problem, as they would never understand the problem associated with improper disposal of solid waste.

More than awareness, it is thought that is most important—the thought of sustainability, conserving the environment and the urge to be a part of it.

Incentive:

Incentives can be of two types: direct and indirect. With direct incentives, people are rewarded directly with money or through other things of value for the amount of recycling they achieved. With indirect recycling, charities of recyclers choice are funded for the amount of recycling achieved. Various innovative models of incentivising can be designed, waste-to-money, waste-to-products, etc. However, incentives come with a caveat. Incentives can motivate people only up to the point that they are comfortable. Anything outside their comfort levels, even though incentivised, would not generate more results. A risk-analysis for incentive projects should be made, so that it does not aggravate the problem once incentives are taken off.

Information Technology and Marketing in Solid Waste Management:

Information technology and marketing strategies can help improve communications as well as facilitate smooth transfer of information between all the stages of supply chain.

Marketing can make you want to go on vacation and decide where you’ll go on vacation. Tactful and subtle marketing is what drives many of our thoughts and actions. Without marketing, most causes, or products, would have never garnered the massive support they currently enjoy. The importance of marketing cannot be denied and should be embraced to spread awareness on the issue of solid waste management. Marketing should be mostly focused on creating the thought. Marketers can plant the thought of importance of solid waste management and how people can be a part of it. While there are many outlets for marketing, like print, digital, television, radio and more, experience is required and knowledge in all of them to create the best impact.

How do we create revenue in solid waste management?

How do we create revenue in solid waste management?

While marketing incurs cost, Tom Szaky of Terra Cycle, has found a novel and brilliant way to generate revenues from marketing, which he termed as “Negative Cost Marketing”. In this method, the publishing houses pay for providing content on sustainability, impact of pollution, environmental conservation and degradation, and so on. In another method, companies use recycled products produced or certified by Terra Cycle, that help enhance the company’s brand image. Marketing should be utilized and the benefits of it should be clearly articulated and communicated.

Information Technology though, is not so ubiquitous. It should be leveraged to create maximum value of the waste at all stages of the supply chain. Bilikis Adebiyi of WeCyclers, have employed information technology to pass on the latest and updated value of the waste being collected to the recyclers through mobiles and this has ensured transparency in operations, along with reduced need for human intervention. Information technology can also be used to spread awareness, by providing relevant material on mobile devices.

Brief overview on entrepreneurship models in recyclable solid waste management:

Wecyclers Corporation:

The operating area of Wecyclers is Nigeria, which is an underdeveloped country, and the company caters to the poorest communities. Wecyclers encourages, people from these communities to segregate and store waste of value, like paper, plastic, etc. The waste collected can be exchanged for something of value. The corporation is funded by MIT Ideas Global Challenge, Coca Cola and other organizations.

Terra Cycle:

Terra Cycle, mostly operates in developed countries, where infrastructure is developed and where already people have awareness and motivation. Terra Cycle works with various stakeholders in the supply chain to create and provide logistics for the smooth flow of recyclables, along with incentivising recycling activity. Operations are mostly subsidized by the corporations and brand partners, thereby providing a constant stream of revenues, which will also benefit them in building their image. Terra Cycle collects around a million waste articles every three to four hours from 23 countries. Items are collected by approximately 50 million people.

Terra Cycle, either refurbishes or up-cycles around 5% of the waste it collects and the rest is smelted to produce polymer solutions, which are used to produce coffee cups. Terra Cycle has a team of researchers and scientists to help them achieve this incredible feat.

Entrepreneurship in Organic Components of Solid Waste Management: An Indian Perspective:

India has a deep and entrenched habit of recycling and the recycling supply chain has a strong foothold in the country’s economy, in the form of kabadiwalla’s and rag-pickers. Due to the virtue of this system, India has one of the highest recycling rates in the world. This poses a strong and unique challenge for entrepreneurs in the areas of solid waste management as most of the recyclables and waste of economic value are processed by the informal sector. That leaves the entrepreneurs only the organic and degradable component of the waste. Thankfully, there have been some innovative solutions for the disposal of organic and degradable waste.

Composting and anaerobic digestion technologies have been applied for the disposal of degradable components. Some of the companies that applied composting techniques are Daily Dump from Bengaluru and Pelican Biotech from Kerala. Green Tech Life from Bengaluru and Biotech from Kerala had employed anaerobic digestion technology to fasten the degradation process. However, the main challenges faced by these entrepreneurs is the indifference and lack of concern of the general public. The people buying these solutions are the more aware and having an urge to be a part of the solution.

EcoWise Waste Management Pvt Ltd of Noida, is a company, which deals with Collection, Transportation, Segregation, Treatment and Disposal of residential, commercial and Industrial waste.

As sea is the culmination for most rivers, all the products end up in the sea of solid waste management. Capitalizing on its potential requires a robust strategy where the base is built on the right infrastructure, righteous awareness and prudent incentives. Information technology and marketing can be used to create awareness and a bigger impact.

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