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- Report n°2: An integrated approach to economic and social contestability in business
Report n°2: An integrated approach to economic and social contestability in business
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Table of contents
- Exchange of batches of scrap metal under the constraint of defection, local challenging vigilance and Nimby
- Economic contestability of the recycler: inputs market and local assets
- ... and a variable degree of openness
- Economic contestability of the recycler: inputs market and local assets
- Exchange of batches of scrap metal under the constraint of defection, local challenging vigilance and Nimby
... and a variable degree of openness
The sources of scrap making up the collection area must be accessible for collection by the recycler (using his own truck fleet, or via those of his collectors). Legal rules (for instance ordering a supplier to be approved for access to demolition sites) or a specific organisation governing access to the resources instigated by the public authority (see, for instance, the case of an obligation upon the producer of a good to recover it at the end of its service life) would directly impact the "degree of openness" of the input market. This property directly influences the potential of a collection area in the eyes of a recycling operator: he may be able to collect only some material flows, while others may escape him.
The choice of site for a recycling facility must take into account any existing standards or standards being prepared that reduce access to the potential flows; this will determine the volume of materials that the recycler will be able to recycle and sell on the output market as well as his ability to meet the expressed demand on this market. A new recycling operator, whose objective is to develop activities rivalling those of the historic operator, all things being equal elsewhere (see below the modes of transactional organisation with the collectors) will have to carefully evaluate the total volume of flows he would have access to, given the rules that restrict access to the resources located in the coveted collection area.
Strategically, therefore, the historic operator should keep a watchful eye on any changes in access to his resources and anticipate any perturbations and miscellaneous restrictions on that access. The attribution of environmental or health risks to some materials naturally present in the resources (for instance, the gases used in refrigerators) or the absence of collection technologies enabling recycling of those materials (tyres on an ELV to be shredded) constitute two reasons that can encourage the public authority, via initiatives that come under the scope of its expertise, to instigate new rules reducing access to the material resources in demand. For instance, setting up approved de-contamination centres for ELV can modify the access to this source of materials. The historic operator therefore cannot avoid concerning himself with the risks weighing on his activity, which can result in new restrictions on access to or a contraction in the size of the resource.