Nokia – Reverse Logistics Initiatives for Used Mobile Phones

Distribution centres face new challenges daily. One of the major challenges is how to handle the inflow of returns from retail vendors, seasonal goods, damages, excessive inventory and so on. Reverse logistics is an interesting area for mobile phones. In India every month 6-7 million new mobile handsets are added to the market. Even ahead of China, India now is the top mobile market in the world. Moreover, it is not all about low-end ones, increasing numbers of middle and upper- end mobiles are also being sold. Reverse logistics is an impor­tant strategic operational tool in the modern business era. This is particularly important for short life cycle industries such as the mobile phone industry. As estimated by Nokia, the aver­age life cycle of a mobile handset the world over is 18 months.

However, in India, it is about 24-30 months, but is shrinking drastically due to the changing consumer behaviour. Interest­ingly, in the war for market share of new handsets sold, retailers are exchanging old ones for the new at their shops. And what happens to the old ones? Even if 30 per cent of Indians replace their mobile handsets, that is nearly 80 million a year, there is a huge opportunity for reverse logistics for mobile handset companies here. Nokia has come up with an interesting concept for recycling its phones. It launched its “We Recycle” campaign sometime back. Within this, it has demonstrated how it will make mobiles using recycled aluminium, circuits and plastic. In Europe it has started putting up bins in the Nokia Care Centres, where people can dump their old mobiles. Something similar can also be done in India. There are e-waste companies such as Inforek Syscom and Trishiya (bought by SIMS Australia last year) that can recycle mobiles and computers. They get their stuff filtered up through the “kabadi” chain. The theoretical recycling ability of Nokia mobile devices ranges from 65 to 80 per cent. Nokia supports the concept of recycling as its drive towards environmen­tal concerns. Nokia is currently developing awareness-building programmes that fit into existing recycling infrastructure and local cultural norms as well as regulatory framework local legal require­ments. Old phones might seem worthless, but they still contain many usable and valuable materials. Nokia’s idea is to make it easier for the consumers to act as a ‘eco-conscious’ citizen by offering the possibility to return old, unused phones and accessories. Authorized Nokia sales and service points are all possible channels for returning used products.

Equipment sold via Nokia networks is traceable with recycling possibilities included in the commercial contracts. Nokia is offerings this service since 1999 in Europe. Currently, efforts in the United States are that pre-addressed, postage-paid envelopes will be included in sales packs, providing the customers with an easy method for returning used products for recycling, at no cost to them. The consumer simply places the contents in the bag and then puts it in the mailbox.

In post-consumer collection, the composition of collected products and materials is verified by professional pre-treatment. For the recycling of obsolete mobile devices and batteries, Nokia selects companies audited through its set of “Requirements for Service Providers.”

Source: Sople V.V (2013), Logistics Management, Pearson Education India; Third edition.