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End-of-life resource recovery

The Fuji Xerox and Xerox Groups have a long-standing commitment to accept responsibility for their products throughout their life cycle, shared by Fuji Xerox Australia.

In Asia Pacific, Fuji Xerox Company Limited has four purpose-built state of the art remanufacturing, reuse and recycling facilities in Japan, China, Thailand and Australia that achieve over 99 percent resource recovery from our products at end-of-life.

We take back products, parts and toner cartridges returned by our customers for remanufacturing and recycling either at our Zetland-based Eco Manufacturing site in Sydney or at the Asia Pacific Integrated Recycling Centre in Thailand.

The Eco Manufacturing Centre processes used parts, packaging and waste collected from Australian customers, while end-of-life equipment and toner cartridges are sent to the Asia Pacific Recycling Centre. There are opportunities to improve the levels of remanufacture and reuse in our 'closed loop' systems so that the embodied energy in our product components is retained. Ultimately the rationale for taking our products back at end-of-life is not just related to responsible 'waste' management; remanufacturing and reusing parts allows us to reduce new resource input and to cut the carbon footprint of new product manufacture.

Eco Manufacturing Centre

The Fuji Xerox Australia Eco Manufacturing Centre is the Fuji Xerox Asia Pacific hub for the remanufacture of complex sub-assemblies. It is a multi-award-winning, state-of-the-art engineering facility for the remanufacture of parts removed from equipment during service.

Since it opened in 2000 the core activities of the Zetland-based centre in Sydney have shifted to more complex remanufacture programs, reflecting its unique expertise. The more labour intensive aspects of the centre's operations, such as toner cartridge remanufacture, have moved to our Asia Pacific Integrated Recycling Centre in Thailand.

The Eco Manufacturing Centre is emerging from a period of transition whereby local management had been working with our parent company to confirm a medium range strategy for the centre.

This strategy has now been agreed and will result in the centre working more closely with regional product development and asset recovery management. This will increase the opportunities for our local remanufacturing expertise to influence the global approach to end-of-life resource recovery and share the benefits of those advances more broadly.

Our work developing and implementing remanufacture programs for Fuji Xerox parts and sub-assemblies and Xerox origin products will continue. Remanufactured Fuji Xerox parts and sub-assemblies significantly reduce the costs of our customer support organisation.

By exporting remanufactured products, other operating companies in the region can also benefit from increased profitability. The centre will also continue to act as a total waste management facility, identifying recycling pathways for returned parts, sub-assemblies and cartridges that are not remanufactured.

In the future, there is the potential for it to act as a centre of excellence, providing remanufacturing consulting to other industries and designing remanufacture programs for implementation in the region.

During the year under review, 198,300 parts and sub-assemblies were remanufactured, which was below our target of 217,000 items. This is due to a decline in demand for remanufactured parts, which can in turn be explained by their increased reliability during service. The centre's 10/11 goal is to remanufacture 232,500 items.

In 09/10 the centre achieved a saving of $5.89 million versus the cost of Xerox and Fuji Xerox supplied alternate parts. Savings would have been higher without currency fluctuations that lowered the price of imported products and made remanufactured items less competitive. Of the 265 remanufacture programs currently in place, 11 had to be cancelled for this reason, although the volume of items under these programs was relatively small.

In 09/10 the centre established 48 out of its 50 target new remanufacture programs. This is an important measure illustrating that innovating new remanufacture programs is core to the centre's viability. Two programs were delayed due to the detail of work required by our parent company and protracted approval cycles. In 10/11 we will work with our parent company to simplify approval for new remanufacture programs.

Asia Pacific Integrated Recycling Centre

Award-winning resource recovery

In 09/10 Fuji Xerox was recognised at the nineteenth Nikkei Global Environmental Technology Awards in Japan with the Monozukuri Special Environment Award.

The award recognises best practice approaches to conserving the environment at monozukuri (manufacturing) plants both inside and outside of Japan.

The Fuji Xerox integrated recycling system and its industry first reverse logistics network for recovering used products and cartridges across China was recognised, as well as its pioneering introduction of reuse and recycling technologies in China.

The Asia Pacific Integrated Recycling Centre based in Thailand was developed by Fuji Xerox Company Limited to process up to 30,000 units of equipment and 500,000 toner cartridges per annum and is now operating at full capacity. The centre achieves over 99.8 percent resource recovery from end-of-life products and employed 350 local staff in 09/10.

Between its opening in December 2004 and March 2010, the centre has processed approximately 131,000 products and generated 21,200 tonnes of recycled resources. Our efforts in product stewardship are not just resolving a landfill issue – through parts reuse we avoided 28,130 tonnes of carbon emissions and 4,460 tonnes of new raw material requirement across all Fuji Xerox companies in 09/10.

Policies and procedures are in place to ensure that the local environment is not impacted by our resource recovery facility. A tracking system deters any illegal disposal and parts containing hazardous substances are exported to specialist waste management providers where required. The facility also monitors the environmental and safety management practices of our local recycling partners in Thailand. Where required, Fuji Xerox has committed to work with those partners to further improve their environmental management.

We joined this program in early 2005 after obtaining the necessary export licenses from the Australian Government in December 2004. In 09/10, we exported 1,481 tonnes of equipment, parts, cartridges and packaging to this facility for recycling or remanufacture. In the year under review the total amount of end-of-life products gathered from our customers increased marginally from 2,320 tonnes in 08/09 to 3,044 tonnes in 09/10.[1]

The weight of equipment recycled has increased by 30 percent on 08/09 levels. As new equipment installations have grown, there was a corresponding increase in end-of-life equipment returned to us. In addition to this, as our market share has grown we have collected more competitive products. However our reporting currently does not allow us to differentiate between competitor product disposed of and our own.

Improvements we make in reporting for regulatory purposes will address this issue. There has also been a 59 percent increase in the weight of assets recovered — this relates to toner bottles that are cleaned, refilled and redistributed. The increase is due to both growing quantities being collected and returned and that they are larger, heavier toner bottles.

In 10/11 we will explore local equipment recycling options that can achieve a similar recycling rate to our dedicated facility in Thailand as part of our broader review of product return systems. Although there have been no issues with our well-managed operations, there is a growing trend against the off-shoring of e-waste due to poor waste management practices in developing countries. Meeting the requirements of the Basel Permit has also been a resource intensive exercise and costly delays have been encountered in the process. We are hopeful that improved business efficiencies and equal if not better environmental outcomes can be achieved through a local e-waste recycling strategy.

Optimising end-of-life product return

As a leader in product stewardship we have invested significant resources in collecting and recycling our end-of-life products. It is important that our systems and processes achieve the best business and environmental outcomes, particularly in light of emerging regulatory drivers. A cross-divisional product stewardship committee is focused on optimising the business and environmental efficiency of our end-of-life resource recovery systems.

The following drivers inform the committee's activities:

  • e-waste regulation coming into effect in 2011
  • increasing demand for customer environmental accounting
  • need to identify business and environmental efficiencies in product return process.

The committee's purpose is to respond to these drivers through the following measures:

Reviewing product return logistics
In the past, the committee has implemented a number of discrete improvement opportunities such as modal shift from road to rail for interstate product returns. However we recognise that a broader review is required and that limited resources are available to conduct this work. In 10/11 we will contract a product stewardship manager who will complete a comprehensive assessment of our product return systems and processes, including reverse logistics and local recycling options.

Establishing product return measurement system
For some years our goal has been to measure the rate of total product return from our customers to our remanufacture and recycling facilities as a percentage of new products distributed.

This is a complex cross-divisional undertaking and while we have made continual progress year on year, we are disappointed by the slow pace. Work is still required to improve procedures and measurement systems to ensure the volume of outgoing and returned products is appropriately recorded. The development of federal e-waste regulation will mandate that the company expedite this work.

This task will be assigned to the new product stewardship manager. In the interim we will continue to provide trend data on the weight of returned equipment, parts and cartridges and how those materials are utilised or responsibly disposed at our dedicated facilities or through recycling providers.

Identifying business efficiencies and new business opportunities
The new product stewardship manager will have an objective to improve the business efficiency of product return systems through a streamlined approach. Any new approach must take into account the increasing customer requirements we have to provide organisation specific product return and recycling reports.

Advocating for extended producer responsibility

Fuji Xerox Australia actively participates in industry association activities that drive the adoption of extended producer responsibility across our sector. Whilst we maintain an extensive end-of-life recycling process for our own equipment, we recognise that some will always find its way into the community waste stream. We participate in these initiatives both to address that residual waste and in recognition of the community's expectation that companies like ourselves should take a leadership role in such matters.

Australian Information Industry Association
We have been working closely with our peers from the Australian Information Industry Association (AIIA) to establish an extended producer responsibility scheme for the computer and peripherals industry. After six years of extensive consultation between the AIIA and the federal Department of Environment, Water, Heritage and Arts, a national e-waste regulation has been proposed. We will continue to take an active role as the regulation is developed to ensure it meets community environmental expectations as well as industry conditions.

Business Imaging Association of Australia
We have also been working with the Business Imaging Association of Australia (BIAA), an association representing business document-solution providers, to establish a code of environmental practice for the industry. This work has been superceded by the proposed e-waste regulation. Our focus now is to ensure our industry is well prepared to respond.

[1] Includes a small amount of waste from Eco Manufacturing Centre office operations.

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