NatWest SE100 Social Business Club Profile: London Re-Use
The lastest in our NatWest SE100 Social Business Club profiles looks at London Re-Use Ltd.
In the wake of the recession and the recent Brexit result, it is encouraging to hear from a social enterprise that meets changing market dynamics with flexibility and success. London Re-use Ltd (LRL) is a social enterprise with a clear mission: to divert reusable bulky items out of the waste-stream in London and surrounding regions. This is no small task. Every year in the UK 1.25 million desks are thrown away and 22,000 office chairs go to landfill.
LRL is an organisation that has seen many changes since it was founded in 2010. Two years ago, the company had contracts with London boroughs to link up owners of unwanted domestic items with re-use organisations. Its role was primarily as a promoter of reuse, contract negotiator and broker.
In the wake of the financial crisis, public services took a hit and a number of London boroughs and re-use organisations stopped offering LRL contracts high enough to cover its costs. Faced with a business that was no longer financially viable, the social enterprise was quick to reassess its approach.
CEO Pyarali Jamal, explains: “I was brought in at that time to do a strategic and operational review, part of which was a market segmentation analysis. It showed we should work more with commercial furniture.”
Adapting to change
LRL has a new model two years on from that. Commercial organisations contract the social enterprise to collect office desks, chairs and storage units, which it redirects to new owners, including large corporations, start-ups, individuals and charities. Its role has changed from broker to direct collector and supplier, and its main clients from domestic to commercial.
With UK businesses spending £1.1bn a year on landfill tax alone (plus the cost of collections and deliveries to waste disposal facilities), there is a definite opportunity for profit generation – which Jamal is confident the social enterprise can seize: “The outlook is promising given that we offer exceptional value-for-money and help clients reduce their waste – which many organisations are increasingly required to do under legislation and as part of their sustainability initiatives.” Numerous big names have contracted LRL, including Diageo, Balfour Beatty, The Big Issue and the BBC.
Reusing a desk has a two-fold effect: landfill is prevented, and the need for raw materials is reduced. If a desk is sent to landfill, the wooden component of the desk breaks down and produces methane. It is the second ‘displacement effect’, however, that brings about the most significant reduction in greenhouse gas emissions.
Creating a new desk relies on carbon-heavy manufacturing processes. In a 2011 report, The Waste and Resources Action Programme (WRAP) estimates that if all reused desks were bought in place of new desks, “the greenhouse gas savings could increase to 2.5 tonnes CO2 equivalent per tonne desks.”
The business is always looking for ways to improve impact measurement. Recently LRL have worked in partnership with a specialist consultancy to develop their own carbon footprinting tool which calculates the carbon diverted from landfill for each contract in a more precise and user-friendly manner.
At any one time the 10,000 square foot warehouse in Croydon is home to hundreds of chairs, desks, office cabinets and pedestals, and a modest array of hat stands, sofas and coffee tables.
In general, the furniture is sold on at 20-30% of the price of comparable new items, which allows businesses or individuals to purchase high-quality furniture at affordable prices. Its no surprise the social enterprise has made significant sales to organisations such as Wates Group with whom LRL has a Preferred Supplier Agreement (PSA).
In a neat example of circularity, last year LRL cleared 29 tonnes of clothes, duvets and kitchen equipment from seven London Universities’ accommodation. The Federation of Rescued Kitchenware (F.O.R.K.) sorted packages of the kitchenware LRL had collected and sold them back to students.
With the nature of work changing, how will the social enterprise respond to changing office spaces? Office furniture is evolving, with greater demand for smaller desks more suited to laptops. LRL is well positioned to meet this demand as it also has the ability to re-manufacture good-quality larger desk designs into smaller desks which are popular in modern office layouts.
London Re-use, it seems, has an answer for everything.