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NTADBMA report submitted to
Prof. Rakesh Basant
Prof. Deval Kartik
Prof Bhavin Kothari
Prof. Jignesh Khakhar
Group 11:
Akshat Verma
Ankit Thavale
Prabhakar Kumar
Samina Rahman
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Table of ContentsIntroduction: ........................................................................................................................................... 3
Current Scenario: .................................................................................................................................... 3
Types of e-waste: .................................................................................................................................... 4
Business Model: ...................................................................................................................................... 5
Value Proposition: ................................................................................................................................... 6
To the end customers: ........................................................................................................................ 6
Reuse: .................................................................................................................................................. 6
Recycle: ............................................................................................................................................... 6
Info: ..................................................................................................................................................... 6
To the Supporting Partners: ................................................................................................................ 7
Platform/Interface: ................................................................................................................................. 7
Resources and Partners: ....................................................................................................................... 12
Promotions:........................................................................................................................................... 13
Financials:.............................................................................................................................................. 14
Assumptions: ......................................................................................................................................... 21
Ad Revenue: ...................................................................................................................................... 21
Advertisement: ................................................................................................................................. 21
Furniture, Machinery and Equipments and its Depreciation: .......................................................... 21
Maintenance & Repairs: ................................................................................................................... 21
Rent: .................................................................................................................................................. 21
Salary and Wages: ............................................................................................................................. 21
Other Assumptions: .......................................................................................................................... 22
Bibliography .......................................................................................................................................... 22
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3 | P a g e
Introduction:
Electronic waste, E-waste, waste electrical and electronic equipment (WEEE) are terms
which refer to the electronic products nearing the end of their useful life. It can be
discarded computers, office electronic equipment, entertainment device electronics,
mobile, television sets and refrigerators. This definition also includes used electronics which
can be reused, resold, salvaged, recycled, or disposed. The term is applied broadly to
refurbishing industries and also to product that cannot be used for its intended purpose. Over
the years, the term has been applied to all surplus electronics and electrical equipment. Due to
rapid changes in technology, changes in media (tapes, software, MP3), falling prices,
and planned obsolescence, the amount of surplus electronics has been increased at an ever
increasing pace.
Current Scenario:
A new era of electronic world has emerged due to the
rapid product innovation especially in IT and telecom
sector. People across the world are upgrading their
computers, buying technically advanced cell phones,
televisions, audio players and printers more frequently
than ever before. Presently the biggest problem is caused
by cell phones and computers as these products are
replaced most often and hence the number of discarded
electrical and electronic waste is piling up to millions.
According to researchers, the uncertainty of how to manage old electronic products leads to
nearly 75% of the waste being dumped into storage. Although many of these discarded
materials can be refurbished, reused or reused but they are not and as a result the e-waste isthe fastest growing segment of worlds waste stream.
At present e-waste makes up 5% of the total municipal solid waste worldwide which is equal
to the waste generated by all plastic packaging material. According to the reports, Asias
contribution towards e-waste generation has been estimated to be 12 million tons each year.
Efforts to regulate or recycle these e-wastes are being developed at a very slow pace.
As per a report published by UN, by 2020 e-waste from old computers in South Africa and
China will have jumped by 200-400% and by 500% in India as compared to 2010 levels. It
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also states that by 2020 e-waste from discarded cell phones will be increased to 7 times than
2010 in China and 18 times in India.
Types of e-waste:Based on two different criteria e-waste has been classified as follows:
Criterion 1: Based on the electrical products:
1. Computer2. Television3. Cell phones4. Some more e-wastes
Criterion 2: Based on their reasons of being waste
1. Type 1: Those electronic products which are working but because of the arrival ofnew technology, the older product are turned into waste.
2. Type 2: Those products which do not possess any function anymore and are actuallywaste.
3. Type 3: Those products which are partially defective and have been discarded.
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5 | P a g e
Business Model:
In this section, we would describe our business logic in a comprehensive manner. Having
identified the need for our product and the target segment, we would describe how our
product provides a unique value to our customers and how they are believed/expected to
value it. The business model also focuses on the mediums to reach the requisite customer
base. We will also try to look at how the generation of monetary wealth and sustainability of
our business proposition. The following are the basic building blocks of our business model.
Each of the blocks has been further explained.
Business Model Promotions
Platform/Interf
ace
Value
Proposition
Resources and
Partners
Financials
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Value Proposition:
To the end customers:
The customer segment that is under consideration has a latent desire to do their bit in
environment conservation. Our Business model and application provides them a systematic,
easy and non-tedious way of doing it. The e-waste, which they would have otherwise
discarded away, is now being properly channelized so that it does not cause any harm to the
environment.
Reuse:
Also, for the people in the target segment, who value creativity, would get an opportunity to
satisfy their creative hunger by using the application. The application would inform them
about ways in which they could creatively utilize the e-waste. They could also post any new
creative ideas to utilize the waste with the help of the application. So, the application also
provides the customers a platform to showcase their creative talents in the field of e-waste
management. For the customers, it also means publicity among the people having similar
interests and earning the redeemable points which can be later redeemed for an offer, coupon,
etc.
Recycle:
Based on the type and volume of the e-waste the customers want to give for recycling, they
would be awarded with redeemable points. There would be a few initial points for
registration and also points for sending an interesting and creative idea for reuse (as explained
in the previous section). The customers can redeem these coupons in a variety of ways. They
can get discounts at certain famous restaurants, spas, saloons, fast food joints such as
Dominos, McDonalds, in shopping malls, apparels shops, etc. The offers that the customer
would get will depend on the type of arrangements we have with the respective service
provider. The core element of this strategy is similar to the business model followed by
coupon and deal sites like Snapdeal.com.
Info:
Another important attribute that the customers gain from the application is relevant
information about e-wastes, current trends, awareness and happenings in the world of e-waste
management. This would appeal to the environment conscious people within the target
segment.
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7 | P a g e
To the Supporting Partners:
The supporting partners would include restaurants, saloons, spas, apparels stores, fast food
joints like Dominos, McDonalds, etc. The customers redeemable points would be redeemed
at these partners end. For each of these, the discount rates equivalent to the redeemable
points can be decided and used further. The partners would get increased sales pus an
opportunity to touch base a large number of our customers. The customer information that we
have can be used by these partners for advertising their own products/stores, etc. They can
also project it as a help they are providing for strengthening e-waste management and proper
disposal.
Platform/Interface:
We would adopt an easy to use interface for the application which guides the user through the
steps in a simple manner.
The home screen would be the first screen that would be visible to the user as soon as the
application is opened.
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The second screen is as follows:
It provides the guest users to register themselves on the application. The option of getting
more information about e-waste management is available to all users at this screen. The
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9 | P a g e
existing users have three options: reuse, recycle and the option to see the accumulated
redeemable points.
If the option reuse is clicked,
The customer here can select from an existing set of option or enter a new category. Based on
this information, the application would search its database and bring out a list of creative
ideas that can be applied to the type of e-waste that the customer has entered.
If the customer chooses the recycle option,
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The application asks for the type and quantity of e-waste and the pick-up point. For existing
customers, the address would be stored unless they want to enter a new address. A customer
can give multiple pick up point addresses.
Once the customers fill out the requisite information, a screen for final confirmation appears.
It reflects the date, time and address of the pick-up.
A new customer has to first register before the reuse and recycle options can be availed. The
registration form is as follows:
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11 | P a g e
The customer would be asked for general details such as mobile number, e mail id, address.
Etc. The customer here has the option to enter multiple pick up point addresses.
For the existing users, there are option to check their points and the offers from our
supporting partners. The offers could be made location specific and would also be used by the
partners for advertising their offerings to the customers.
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In the know more section, the user is provided more information and is kept updated about
the latest happenings in the world of e-waste. The screenshot is as follows:
Resources and Partners:The value chain requires presence of customers who are willing to give away their e-waste
for disposal. It also requires companies/manufacturing units willing to buy the e-waste. For
the redeemable point incentive to work, the supporting partners who are willing to offer some
discounts or coupons on the redeemable points must also be in sync. The chain is
diagrammatically represented as follows:
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13 | P a g e
As can be seen, the supporting partners play a significant role in the overall functioning of the
business model. The resources required would include a mechanism for point to point
collection of the e-waste and a facility to temporarily store the collected material. Also, a
mechanism to sort the materials as per the requisite industry needs would have to be in place
for efficient functioning.
Promotions:
The promotions would be focussed on creating awareness about e-waste, the current scenario
and its dangerous effects and how the application can solve it. The primary objective would
be to evoke and appeal to the environment conscious nature of the target segment
empowering them to do their bit in saving the environment without the requirement of a
tiresome effort. The redeemable point based incentive system would be projected as anadditional advantage of the application.
EW !
Supporting
Partners
Customers
Manufacturing
units
Provide e-waste products,
any new innovative ideas
on reuse
Provide Redeemable
Points
Advertising Support,
Sales O ortunities
Provide Recyclable
e-waste
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Financials:
The actual data on the amount of e-waste in India is hard to determine. The sector is highly
disorganised with multiple layers which makes it even harder to determine the exact market
size. Several agencies, both government and non government have tried to get an exact
estimate of the amount of e-waste that the country generates. The agencies mostly base their
studies on a model which takes into account the obsolescence of electronic products, which is
also validated with the field data.
The amount of e-waste generated by the country is poised to grow at a very healthy rate. The
West Bengal Pollution Control Board has determined that the growth of e-waste has been at a
Cumulative Accumulated Growth Rate (CAGR) of 6% 2007 onwards and is likely to remain
same going forward. According to a document on e-waste released by the Department ofInformation Technology, the growth in the amount of e-waste in India has been predicted as
follows:
The graph above clearly shows the existing and potential exponential growth in the amount of
e-waste that is likely to be generated in the future.
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15 | P a g e
There is great inequity among the states and the cities in the country in the generation of e-
waste. A few states, namely, Maharashtra, Tamil Nadu, Madhya Pradesh, Gujarat, Karnataka,
Delhi, West Bengal, Andhra Pradesh and Uttar Pradesh, generate about 70% of the countrys
e-waste.
The reason for this can be attributed to the rapid rise in the economic levels of these cities,
increase in the disposable income and increased tech-suaveness. Even, within the states, a
majority of contribution towards e-waste comes from the cities. A few major cities generate
more than 60% of the total e-waste in the country. A distribution to that effect is shown
below:
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This again can be attributed to the rapid growth and increase in living standards in these
cities.
These cities would be used as the target for the business, i.e., the business would start off and
soon cover these cities before it is expanded to other places. The total e-waste in 2013 would
be 589893 MT. Assuming that these cities account for 60% of the countrys total e -waste, the
e-waste generated in these cities would be 353936 MT. Almost all the e-waste in the country
id contributed by various major categories, namely, Television, Mobiles, Notebooks, Printers,
Refrigerators, CDs/DVDs and Desktops. There is significant variation in the amount
contributed by these categories. The chart below shows a relative contribution among the
various categories.
This relative contribution is likely to change over time. A rapid rise in the sale of desktops,
notebooks and mobiles is likely to increase their share over the years. The West Bengal
Pollution Control Board, in its report on e-waste, predicts the relative contribution of these
categories to change as follows:
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17 | P a g e
Percentage Contribution of Various Categories to E-Waste
Categories Years
11-12 12-13 13-14 14-15 15-16 16-17
Desktop 25.97 21.81 28.31 35.81 39.20 46.69
Notebook 0.82 1.12 1.31 1.45 1.74 2.06
Printers 1.19 1.29 0.94 0.83 0.78 0.69
TV 52.57 54.50 50.02 44.39 42.17 37.02
Mobile 0.59 0.48 0.54 0.57 0.53 0.55
Refrigerator 13.59 14.86 14.37 12.88 11.70 9.50
CDs/DVDs 5.27 5.95 4.52 4.07 3.87 3.49
The sale value of each of these categories would be different. Hence, it becomes increasingly
important to be aware of the relative contribution of these categories in the overall e-waste
generation.
Our clients would include recyclers authorised by the Central Pollution Control Board. They
are mostly situated in Bangalore, Chennai and Thane. The tentative list is as follows:
-Parisara Pvt. Ltd
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-Energy
EarthSense Recycling
The revenue side of the business would include the revenue generated from the sale of theproducts in these categories. The advertising fees collected from our partner firms would
form another chain of revenue streams.
The expense side would include the advertising cost, the commission and employee benefit
given to the employees, the collecting mechanism such as vehicles, etc., warehouse expense,
salaries, wages, inventory cost of storing the collected products, office expenses, etc.
The financial analysis has been done for the next five years 2013-17. The rate per kg for each
product category has been determined using a primary study of the market and informal
discussions with the personnel in the current e-waste distribution channels. The table below
shows the year wise tonnage segregated category wise.
Cumulative amount of e-waste (Metric Tonne) 589893 651831.5 713770 788716 863662
Rate
2013 2014 2015 2016 2017
Desktop 50 128656 184533 255601 309177 403244
Notebook 500 6607 8539 10350 13724 17791
Printers 100 7610 6127 5924 6152 5959
TV 100 321492 326046 316843 332602 319728
Mobile 100 2831 3520 4068 4180 4750
Refrigerator 25 87658 93668 91934 92280 82048
CDs/DVDs 10 35099 29463 29050 30523 30142
Tonnage
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19 | P a g e
Assuming that the profit margins are 10% of the sale value on each category:
Since the current focus is only on a few selected cities which would accumulate for 60% of
the total e-waste, the market size available for us is shown below:
In value terms, the revenue that can be generated, based on the assumed rate, is given below:
Assuming that we are initially able to penetrate only 5% of the market and that the
penetration increases by 1% each year till 2017 thereby giving us a 9% market share. The
revenue projections are as follows:
Desktop 5
Notebook 50
Printers10
TV 10
Mobile 10
Refrigerator 2.5
CDs/DVDs 1
Cumulative amount of e-waste (Metric Tonne) 353971 391138 428262 473182 518197
2013 2014 2015 2016 2017
Desktop 77193 110720 153361 185506 241946
Notebook 3964 5123 6210 8234 10675
Printers 4566 3676 3555 3691 3576
TV 192895 195628 190106 199561 191837
Mobile 1699 2112 2441 2508 2850
Refrigerator 52595 56201 55160 55368 49229
CDs/DVDs 21059 17678 17430 18314 18085
Tonnage
Cumulative amount of e-waste (Metric Tonne) 2728314 2982110 3193635 3553576 3867254
2013 2014 2015 2016 2017
Desktop 385967 553600 766803 927530 1209731
Notebook 198204 256170 310490 411710 533743
Printers 45658 36763 35546 36912 35756
TV 1928950 1956277 1901055 1995609 1918366
Mobile 16989 21119 24411 25081 28501
Refrigerator 131487 140502 137900 138420 123072
CDs/DVDs 21059 17678 17430 18314 18085
Value (Rs '000)
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Here, we have assumed a national rollout plan in 10 cities, namely, Delhi, Mumbai, Kolkata,
Chennai, Ahmedabad, Surat, Nagpur, Bangalore, Hyderabad and Pune. The estimated income
statement for the 5 years and the Net Present Value for the project are as follows:
Year 2013 2014 2015 2016 2017
Market Size (Rs. '000) 2728314 2982110 3193635 3553576 3867254
Penetration 5.0% 6.0% 7.0% 8.0% 9.0%
Revenue realised (Rs.) 136415706 178926573.5 223554477 284286057 348052850
Year 2013 2014 2015 2016 2017
Revenue
Sales Revenue 136415706 178926573 223554477 284286057 348052850
Ad Revenue 3600000 3780000 3969000 4167450 4375823
Total Revenue 140015706 182706573 227523477 288453507 352428672
Expense
Advertising 54566282 54566282 54566282 54566282 54566282
Web Hosting, Domain & Server 2000000 2100000 2205000 2315250 2431013
Depreciation/Amortisation 20000 20000 20000 20000 20000
Equipment Depreciation 20000000 20000000 20000000 20000000 20000000
Salaries and Wages 10000000 10500000 11025000 11576250 12155063
Maintenance and Repair 16857500 16857500 16857500 16857500 16857500
Office Supplies 500000 500000 500000 500000 500000
Rent 12000000 12000000 12000000 12000000 12000000
Other 6820785 8946329 11177724 14214303 17402642
Total Expenses 122764568 125490111 128351506 132049585 135932500
Profit Before Taxes 17251138 57216462 99171971 156403922 216496172
Tax @ 35% 6037898 20025762 34710190 54741373 75773660
Profit After Tax 11213240 37190701 64461781 101662549 140722512
Ap Development Cost 100000
Furniture and Equipment 100000000
Free Cash Flow -68866760 57210701 84481781 121682549 160742512
Discount Rate 12%
NPV Rs. 23,83,28,589
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21 | P a g e
Assumptions:
Ad Revenue:
There are approximately 30mn Smartphone users in these 10 cities. Out of these, we estimate
a conservative user base of 1 lakh users (approx.). If 10% of these use the app per day, we
have 10,000 per day users. Assuming 1 paisa per user, our daily revenue would be Rs. 1000.
Advertisement:
Educating the customer would be required for the application to succeed. Aggressive
marketing campaigns would be needed to promote the concept and services. Hence, we have
taken the advertisement and promotion cost to be 40% of the revenue in the initial year and
constant thereafter.
Furniture, Machinery and Equipments and its Depreciation:
In each of the 10 cities, we have assumed that we would require 5 trucks/trolleys each, the
cost of each of which is estimated to be Rs. 20,00,000 inclusive of all charges. The
depreciation is assumed to follow a straight line method with nil salvage value at the end of 5
years.
Maintenance & Repairs:
Each vehicle is estimated to travel approximately 85 km/day and Diesel charges have been
assumed to be Rs. 45/litre and a mileage of 4 km/litre and maintenance charges of Rs. 50,000
per annum.
Rent:
In 2013, we would be handling an annual tonnage of 3539.71 MT, which are approximately
300 MT per month and 30 MT/month/city. Since TV is the most voluminous product that we
may have to handle, to remain conservative, we take TV as the basis for the area requirement
calculation. Assuming a conservative average space requirement of 6Sq. ft., and a weight of
20kg, we will have to fit approx. 1500 TVs which require a space of 10,000 sq. ft. And rent
of Rs. 1,00,000.
Salary and Wages:
Each city would have 2 senior level managers, 4 middle level managers and 4 other office
employees for handling technical aspects, accounting, office administration, etc.
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Other Assumptions:
The corporate tax rate is assumed to be 35%. The app development cost is to be amortized
over 5 years with a nil salvage value. Other expenses have been assumed to be equal to 5% of
the revenues in the respective years. The discount rate is assumed to be 12%.
BibliographyChatterjee, D. S. (2011, September). Electronic Waste and India. Retrieved August 13, 2012, from
deity.gov.in: http://deity.gov.in/sites/upload_files/dit/files/EWaste_Sep11_892011.pdf
International, I. (2010, April). E-waste Assessment in Kolkata Metropolitan Area. Retrieved August
13, 2012, from www.wbpcb.gov.in/:
http://www.wbpcb.gov.in/html/downloads/Ewaste_AssessReport_ICC.pdf
Vivek Khattar, J. K. (2007, November). e-Waste Assessment in India. Retrieved August 13, 2012, from
www.weeerecycle.in: http://www.weeerecycle.in/publications/reports/GTZ_MAIT_E-
waste_Assessment_Report.pdf