Remanufacturing and the Circular Economy
Within the Circular Economy value recovery cycles, products can be REused, REpaired, REnovated, REmanufactured or REcycled.
The Circular Economy model applied to Remanufacturing aims to reuse end-of-life products and components as resources, for making good as new, or upgraded products.
Remanufacturing is a well-defined industrial process.
The industrial process consists of restoring a worn-out component or product (broken, at end-of-life, obsolete or waste), to a product with equal or higher performance, quality and warranty as a new product.
The Remanufacturing process makes it possible to recapture the products intrinsic value, including relevant materials and components, imbedded production energy, imbedded evidence of real-use, and imbedded technical design.
The Circular Economy is strongly supported by the European Commission, who frequently proposes Project Calls on this topic.
Unlike the recycling process which recovers only a portion of the materials and embedded energy from a product, Remanufacturing bypasses much of the industrial phases of new product development and production - by recovering a majority of the formed/machined materials, embedded energy, and knowledge and experience that is already integrated in the product! (recaptured in a new life cycle)
Making a new product requires high consumption of materials and energy, most of which, are not embedded in the final product itself – like industrial consumables (oil, heating, electricity, water…), and infrastructure, (software development, and transport for example). These consumed elements cannot be recovered in any of the Circular Economy loops.
The remanufacturing process requires much less consumption than generating a new product. It avoids a significant use of virgin materials, a reduction in energy and information that is needed for development iterations and manufacturing of a new product.
Remanufacturing is a strategic industrial way to recapture lost value, create jobs, reduce waste, and potentially change the customer-maker relationship.
A lower price barrier
The consumer has access to a quality product and brand at a lower price.
It can significantly reduce unit production costs
Makers are looking for cents. Here, they can save thenths of euros by collecting components from end-of-life products, reducing the energy requirements and raw material costs to make new products.
State of the art technology
With a 3-5 years service contract, the customer has access to the latest technology/aesthetic/interface more frequently than the usual 10-15 year life cycle of products.
Create new ranges of products and services
REman products can be proposed as new ranges, in accordance with the standard ranges; New services can be proposed to users.
Many Remanufactures argue that REman products can have higher quality, as quality control systems are usually higher than that of new products, and the maker has designed them to last!
It can internalise revenues
Which, external companies, already profiting from second-life products, would otherwise capture. Such as damaged product re-sellers and scrap material merchants.
Greater after sales service
This service can be for the entire ‘life’ of the product (perhaps within a service contract of 5 years); and can be quicker ‘next day service’…
Designing products specifically for the Remanufacturing process will optimise the Reverse engineering(design for disassembly, design for tests, design for logistics...), which will benefit the standard range of new products.
Access to eco products
The customer has access to products and or product/services that are ‘greener’ than the current products.
Better quality proposed
The engineering teams will acquire a better user experience from the returned products, which will benefit the next ranges of new or Remanufacured products.
From the range of new services that could be proposed to the user with the Remanufactured products (leasing, Premium After Sales Service...), the maker will develop closer customer relationships.
It can create more jobs, and more skilled jobs, in manufacturing. Remanufacturing usually requires an increased man-hour/kg ratio than the manufacturre of a new product.
Reduce environmental impact
It can be used to reduce environmental impacts of manufacturing new products. Such as reduced green-house gas emissions, toxic air pollutants and waste.
Be better prepared for future legislation
Environmental taxes will come - this sets the company on a pro-active direction for mitigation.