Reverse Logistics: The Upsides of Teardown

In reverse logistics, teardown is the act of disassembling a finished good, such as a laptop or tablet, to harvest its components for reuse and value recovery. It is a key part of almost every efficient product returns management program for electronics manufacturers and service providers. That’s because the teardown service provides these companies with three valuable upsides:

1. It’s green. By testing and reusing components recovered from disassembled returned products – whether it’s through remarketing or reintroduction into the company’s own service parts inventory – it is possible to extend the life of perfectly good electronic components, which is good for the environment.
   
   
2. It’s cost-effective. A manufacturer may need to use a certain type of component within a returned product for spare parts. A teardown service provider can disassemble the product, test the needed components to manufacturer specifications, and provide the good ones back to the customer’s service parts inventory. The result is that the customer spends less than if it had bought the parts new or was forced to have obsolete parts manufactured at a significantly higher cost.
   
   
3. It has profit potential. In some instances, the teardown operation not only saves the customer money but may also pay for itself by delivering additional revenue for the customer. A few teardown service providers, including ReSolve, can remarket other components recovered from the units that are not needed by the customer. The end result is revenue recovery that can make up for the cost of the teardown.

Here is an example of how a successful teardown program works. A ReSolve customer wanted to recover and reuse the cable cards contained in its returned cable boxes. The problem was that to retrieve the cable cards, disassembly of the cable box was required. Working with the customer, the ReSolve solutions team determined it would be costly to extract and ship the cable cards back to the customer. The challenge was further complicated by the customer lacking a budget for the recovery of the cable cards.

The ReSolve team analyzed the makeup of the full cable box and determined that additional components contained within the unit, such as the hard drive, were worth more than twice as much as the cost to recover the cable cards. A program was then enacted to recover not only the cable cards for the customer’s reuse, but also the hard drives – which were tested, securely erased, and remarketed by ReSolve’s remarketing team. The end result was net value recovery that not only covered the cost of the disassembly but also returned revenue directly back to the manufacturer … a profitable, win-win scenario for the customer and the environment.

If your company has been engaged in recycling returned goods without considering the value recovery options associated with teardown, you may want to reevaluate your options. You might be missing out on upsides that could benefit your bottom line.