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|Phase 1 Day 3||2001-10-04||Garry King (Renew North East Ltd, Felling)|
Submitted: (Report on the operation of the above (For copy see Official Minute Book)
The Chair welcomed Mr Gary King, Production Manager of Renew North East Ltd, to the meeting:
Mr King elaborated upon the report presented to the meeting, pointing out that the first Renew (Renew NE) had been established in Gateshead in May 2000; with the organisation recycling dry white goods on a non-profit basis. Its three objectives were to (1) undertake training and provide full-time opportunities for socially disadvantaged persons (2) achieve 74% self-financing from the sale of end-of-life dry white goods, and (3) reduce impact on the environment by prolonging the life of dry white goods.
Phase 1 of the operation had involved the recycling of 65% of material from the Comet platform in Gateshead and 35% refurbished for sale. There were 15 trainees at present, involved in the stripping-down to basic components for shelving, reuse or sending to appropriate bodies. (NVQ Level 2 in service repair qualification). The project aimed to recycle or prolong the life of domestic appliances. Numerous examples were given. Refrigerators beyond repair were de- gassed, the oil drained and sent to suppliers. All glass was segregated. Heating elements were stripped and recycled (the copper smelted and reused). Concrete ballast from washing machines was sent to Springwell Waste and Recycling Centre. All office paper was recycled. Steel was fragmented by a vibration system and sent to foundries; electrical wires sent to shredding centres for separation. Aluminium - sent to Alcan Ltd foundries - was stripped, crushed and compacted.
Phase 2 of the operation aimed to have a second vehicle operational by the end of the year. This would enable 100% collection from the Comet platform. Phase 3 related to publicity for collecting donations (84 end of life dry white goods so far) and Phase 4 would aim to establish a partnership with Gateshead Council to pick up bulk waste for refurbishment or reuse at the Renew site.
At this stage, the following questions were asked:-
(1) Renew seems like an example of good practice. Do you take white goods from any retailer other than Comet? If not, is there room for expansion of white goods re-use in this area, for example across the river in Newcastle? Was there a possibility for part exchange with the public? (Jo Bourne)
Mr King reported that part exchange was part of the service (having established reparability). In terms of extending the operation to `over the river', this was a problem of capacity at this early stage so there were no plans to extend at present. The Chair queried whether it would make sense to have one big unit covering the Tyneside area rather than the existing situation of several smaller units. Mr King suggested that from a local point of view they were trying to re-establish economic growth within smaller areas and because they were restricted by funding for trainees (who had to rely on public transport etc) this was difficult. From a personal point of view, however, Mr King suggested that three or four units might be better from a strategic point of view.
In response to Bob Stewart's query concerning the involvement of companies other than Comet, Mr King pointed out that there was again a capacity issue in terms of the project's operation, but Comet had been `on board' from Day 1. Phase 2 of the operation involved trying to establish a High Street `presence'. Mr King stated that people did buy directly from the project - there had been 15 sales per week at �60 per product.
(2) How pro-active are you in selling your goods? For instance, have you approached the Council (s) for contracts to supply them with white goods? (Bob Stewart)
Mr King reported that there were arrangements with Gateshead Metropolitan Borough Council. There was only 5 staff on site, so in terms of sales and marketing expertise they relied on the Council's support. Comet utilised the operation to refurbish goods from asylum seekers (at present, 60% of refrigerators were being so utilised). Partnership was the key.
(3) How do you advertise or market your goods? Not many people around here seem to know about Renew yet. Do you think more publicity would lead to a bigger market for your renewed goods, and if so, could you cope with it? (Eric Landau)
Mr King reported that this was a question of limited funding for marketing strategies. Renew would like to advertise from the production side, but if sales increased they simply would not have the facilities to keep up with it.
Eric Landau queried who received the income from broken-down component parts. Mr King stated that the income came back to Renew. He undertook to report details (although this was not a significant amount).
Roger Mould queried whether lack of funding was an issue in terms of progressing the phased development of the operation. Mr King confirmed that this was a restriction, but the market was definitely out there.
(4) Do you manage to shake off the perception of second hand goods being second best? (Nick Fray)
Mr King reported that public appreciation was maintained, since a 6-month warranty guaranteeing good quality was given. The organisation tried to `sell' its business on the basis of environmental issues, but market research did not really enlighten on whether this was significant to people who wanted inexpensive and reliable goods.
In response to Roger Mould's query, Mr King confirmed that safety regulations for the trainees were followed through to the highest standards. There were three fully trained service engineers on site.
(5) Your employment record for the people you've trained seems very good, proving that re-use and employment can work together. How many stay with your company? How many go back to unemployment? (Will Haughan) using any other incentive schemes? (Will Haughan)
Mr King reported that there had not yet been an end of year analysis. In response to a query, Mr King stated that funding was secure until the end of 2002. A bid for 2003 was being prepared, so this made for a year-on-year situation. In referring to a previous statement that Renew aimed at covering 75% of costs from sales, the Chair queried whether this was on target. Mr King replied that this was proving difficult. There was capacity to take on 25 trainees, but the Employment Services had found the recruitment stage difficult.
(6) What changes would have to take place for this to be a viable operation rather than based on funding and minimum wage? How does the funding work for your trainees? (Bill Hopwood)
Mr King suggested that there would have to be changes in the training operation. As stated previously, at present there were 3 professional engineers for 15 trainees. So to be a viable company not dependant on funding, this would have to have a number of `core' employees. A Sales and Marketing Department would have to be established in the marketing of product
Sylvia Conway queried if any of the products were going into schools. Mr King stated that no sales to schools were taking place at present.
Mr Capon queried whether, given that Comet was not an official `funder', wasn't there a case for that retailer to pay the organisation for taking away its waste- and perhaps using a `corner' of its resource to provide the High Street `presence' referred to earlier? Mr King replied that there had been discussions at Board level. There were in his understanding, legislative restrictions here since Renew refurbished material other than that supplied by Comet. Mr Capon queried if Renew considered the Gateshead civic amenity sites as good examples. Mr King felt that they were professionally managed and well displayed.
(7) When you've cannibalised and re-used all you can, where does the remainder of the white goods go? Do you think this amount could be reduced? (Eric Landau)
Mr King reported that this aspect was part of the ongoing engineer training. Current `tooling' techniques were used, and material was not `smashed with hammers'. There was capacity for one vehicle to undertake 200 trips, but at present approximately 160/170 were taking place. The Comet platform at Gateshead was cleared on Mondays and Tuesdays. Will Haughan queried if the units sold were energy efficient. Mr King responded that they were not as energy efficient as new product.
Nick Fray asked if there was any connection with charity chops before their material was thrown away. Mr King reported that there was involvement with a Community refurbishment Project in Byker, and two Salvation Army charity shops were also used. Discussion was presently taking place with Scope.
In response to the Chair's query, Mr King reported that Comet had 11 platforms in the North East, but that the Depot in Gateshead covered them all. In effect, one Depot brought in most of the material for the area. The Chair asked now much of the product handled by Renew was considered simply `out of fashion' by the donators, or just not doing its job. Mr King suggested that 70% of the material was redundant or broken down. The remaining 30% was upgraded. (Arising from the Chair's example, Mr King reported that an 8-year life cycle was appropriate for refrigerators.)