Plastics News correspondent Rebecca Kanthor traveled to Beijing to visit Incom Resources Recovery Recycling Co. Ltd., a 7-year-old company that has recycled more than 7 million PET bottles. Liu Xuesong , a founder and deputy general manager, spoke about her journey in the plastics recycling business.
Q: How did you get started at Incom?
Liu: Before this, I worked at a Japanese company, which I entered right after my graduation from a Japanese university. I kept working there until the end of 2010 and came here. I love doing environmental protection and I have been dreaming of doing a related job for a long time. All the three of us partners were classmates at the China Europe International Business School's EMBA program. I came to this company and this factory specifically being in charge of purchasing.
Q: What were some of the challenges at the beginning?
Liu: We found recycling is a huge problem. So we specialized in doing the recycling. I visited all the trash grounds in Beijing. In this procedure, I saw certain kid doing very dirty and very heavy work on the ground. So I felt that, this industry, as it already has a very long history, will be very hard to change. Yang and I thought we could find some internet-based solutions. So we invited Chang Tao, who has IT experience. So we did this together, trying to make a difference by using approaches of the internet. Every step was quite hard. We never had any idea in the beginning. But as we went deeper into the problems, new methods came out again and again.
We buy the bottles with a very high prime cost. And the chips that you sell can't be more expensive than the plastic directly made from petroleum. If it's more expensive, the companies don't need to use my product. After all, there is no law confining such practices. So I'll have to cheaper. So I can't control the upstream or the downstream. Can you understand? So we can't make money. The only thing I can do to change is to control the way of recycling.
Lots of chances also emerged. Having gone so far, I now think we might really change China. This is our dream. No one is willing to engage in the line of garbage. But when we are engaged in it, because we adapted the Internet way of thinking and other experiences from abroad to this line, it became a lot of fun.
Q: Why do you feel there is a need to change the recycling industry in China?
Liu: I've been to lots of trash ground in Beijing and I saw kids of 3 or 4 years old sitting there and, as you said, using a knife to scrape bottles, which can be sold [for more] without the label. It's really dangerous. Their living environment is also very tough. These trash grounds also have lots of problems like secondary pollution. If they are not out there working, Beijing and Shanghai might be already buried under garbage. They are also collecting the trash, so we cannot just blame on them. In fact, it requires the participation of government, enterprises and individuals to promote garbage separation, recycling, and waste reduction, which haven't been really implemented so far. But if you just entirely copy advanced approaches and ideas from abroad, it will not work.
Q: Has it been smooth sailing?
Liu: We are always faced with problems as we implement our plans, so we keep on adjusting our plans all the time. Now we have two general intentions. The first is that we want to build an independent system: recycling machines for beverage bottles, cell phones, waste papers and energy saving light bulbs. The second is to build an integrated value chain including but not limited to: garbage management, garbage recycling and garbage reusing.
Q: How did your role change at the company?
Liu: We had to transform or we'll become broke. I was originally in charge of marketing. But purchasing bottles was too important. If we don't have enough bottles, we'll have to stop working. There is no other solution. So we agreed that I'd take charge of purchasing. Now I'm in charge of coordinating with government, marketing and purchasing.
Q: How are you adding value to your business?
Liu: What I want to do, as well as what we're doing right now is environmental education, because in China, environmental education is [not sufficient]. We've built recycling machines in almost 300 primary and secondary schools in Beijing. We've launched environmental classes in 50 schools. Education is a great form of promotion for our corporation. At the same time, we fostered good habits of garbage categorization in the kids. The thing I'm most interested in personally is to do environmental education and building an eco-brand, cooperating with Japanese designers.
Q: Sounds quite idealistic.
Liu: We want to do both, to make money and to realize an ideal. Because we want to do environmental protection deep down inside, especially for me, who has a child and was largely influenced by my time in Japan. Mothers nowadays are all very concerned with the air quality, food quality problems imposed upon our children. But if you messed up your career of environmental protection and become broke, it's even worse than not doing anything at all. Because it makes others think negatively towards environmental protection.
It's been always difficult in China and it's just getting better. So, if even we fail, people will be like “Ouch, the three of CEIBS [alumni] even failed. Three!” No one will ever dare to do it again. So we are having a great deal of pressure.