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Online-to-offline waste recycling industry expands in the capital city, using innovative development strategies
On the morning of the first weekend of each month, 28-year-old programer Liang Tianlong waits patiently for the recycleman to collect his household waste, including papers and bottles. Liang said he's gotten used to it after having done it for more than six months.
Nowadays, a growing number of Chinese can enjoy services like Liang's, thanks to the development of the online-to-offline waste recycling industry.
New Living (Beijing) Information Technology Co Ltd is a startup at the heart of the sector, which was established two years ago. It's developed an application that provides a regular door-to-door recycling service for waste - including plastic bottles, cans, paper and old electronic appliances.
Having won itself a solid customer base in the capital, New Living is striving to carve out a self-sustaining business model, according to Xia Fan, its CEO.
"As scrap prices are declining, the company's innovative business model is showing advantages in dealing with the challenges," Xia said.
Besides the recycling service, the app also provides e-commerce services, enabling its users to purchase fruit and vegetables online and to hire housekeeping or repair services.
Such services are not uncommon on other O2O platforms. But Xia said his company's increasingly mature logistics system gives it an advantage over competitors.
"When collecting the waste, the worker can also bring what the clients order online. That's how we reduce the cost and improve logistics efficiency," Xia added.
Xia said he believes such "reverse logistics" is a sustainable business model and will add to returns from the recycling business.
To date, New Living has built up a recycling team of more than 300 recycle men who serve more than 200,000 families in 800 communities in Beijing.
The amount of waste paper New Living recycled so far in 2016 more than doubled to 6,500 metric tons from the same period of last year. In the same period, the number of plastic bottles and cans processed totaled 36 million, up 38.5 percent from a year earlier.
In the past several years, many startups have been spawned to compete in the industry, especially after the government released a six-year plan on building up a recycling system for renewable resources in January 2015.
According to statistics from the Ministry of Commerce, the size of China's top 10 categories of recycling renewable resources in 2015 was worth 514.94 billion yuan ($74.15 billion).
Li Yinan, an analyst at China Co-Harmony Investment Fund Management Co Ltd, said companies needed to establish a sound and sustainable strategy.
"The door-to-door waste recycling service is the actual demand of many individuals. That means a tremendous market potential ahead," Li said.
"For household waste, however, the profit margin is relatively low. O2O startups in this sector need large-scale operations."
Tian Yuanyuan contributed to this story.
jingshuiyu@chinadaily.com.cn
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A worker (left) stores old newspapers and other recyclables in his electric bike in Shanghai. A recycling company employee (right) shows a granny how to install and use the New Living applications for pickup of the recyclables in Shanghai. Fang Zhe / Xinhua |
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A woman scans and installs an application for the collection of waste in Shanghai. The recycle collection and pickup services, via apps, are now popular in big cities such as Shanghai and Beijing. Yang Yi / For China Daily |
