Resource: Case Studies: Comptec
Comptec remanufactures compressors for refrigeration and air-conditioning applications.
Tuesday, 31st October 2006
Machines are produced by Comtec with sizes ranging from 1 kW to over 100 kW. Most of the business is in the UK, but some is now going into Europe where facilities of this type are rarer. Comptec employs around 28 people, handling around 5000 units per year (ca. 5% of the total compressor market in these sectors), with a turnover of �1.5m in 2001. The value is in the higher end (75-100 kW) where labour costs are a smaller fraction of the total value. Special features of Comptecs Operations Comptec operates in a number of ways. As a 4th party supplier on behalf of service companies serving supermarkets, they are contracted to remanufacture non-functional units from site as inventory replacements under warranty elsewhere. They also provide a direct service under warranty on behalf of OEMs; to the customer, Comptec is part of the OEM. Comptec also obtains cores from redundant plant and shops, which are held for resale to retailers into end-users. Like many other remanufacturers, Comptec is asked to provide a "total solution": for example, handling the disposal and documentation of end-of-life machines. They use a trusted network of business to complete certain tasks. Each core is subject to a process of: stripping, cleaning and measurement; replacement of moving parts; discretionary remanufacture through 3rd parties of e.g. motors; stage-wise checks; rebuild and final test.
Special Features of the Sector
Remanufacture of precision manufactured components retains their value and avoids land-fill or return to smelting. There may also be some benefits in higher observance of standards in the collection, reuse or disposal of refrigerant gases. Core technologies are constantly changing due to the action of the OEMs. At the low end of the market, the trend is towards machines of finite life requiring low or zero maintenance, with disposal at end of life. Here, low prices and black-box designs make remanufacture uneconomic. At the higher end, technology evolves but machine types come in and out of favour due to the latest advance in efficiency, for example. New equipment is simpler and more robust, and some OEMs have bought up remanufacturers, to recover the value that they have been generating and retain it in-house. Purchasers prefer to buy 'new' rather than 'reused' goods, unless the price is right. Remanufacture is becoming uneconomic at the low end of the market, due to competitive OEM prices for new products. There is no cascade of remanufactured product into secondary markets e.g. in the developing world, where there is low-cost labour that can remanufacture items, albeit with fewer concerns over environmental issues. Post-use equipment may be diverted into secondary markets via reclaimers, but such markets have a poor track record of payment for services and goods.
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