Dead ringers? - Giving old mobiles a second life in the developing world

Eazyfone buys and recycles old mobile phones collected by charities, hospitals and schools, and sells them on cheaply in the developing world. Pete Petrondas explains how he developed a successful strategy
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The Independent Online

With more and more of us developing a green conscience, it was only ever going to be a matter of time before businesses started making big money out of it. For Pete Petrondas, 29, the potential for him only became obvious when he'd started up a business in what might seem one of the most environmentally unfriendly industries there is - mobile phones.

Indeed, Eazyfone began as a distributor and dealer of mobile phones in 2001. But it wasn't long before Petrondas started to recognise the potential of a greener niche market. "We were selling a lot of phones up in the North-west, where we're based and where I grew up, but we were getting a lot of phones back too as customers upgraded their contracts. I started wondering what we could do with them and that's when we hit on the idea of giving them a second life," he explains.

In 2003, the company was completely remodelled and today Eazyfone is a European leader in the re-use and recycling of redundant mobile phones. "Basically, we use innovative, incentive-based methods of procuring these mobile phones throughout the UK and now Europe, and we get them out to developing nations, where the cost of mobile phones is prohibitively high for the bulk of the population. It's very much in line with the millennium goals because it provides an alternative means of communication for developing nations through low-cost methods of procurement in the western world."

Quite simply, Eazyfone pays a significant proportion of the value of the phone to the charity, individual or business that passes it onto them, and then is paid by distributors, organisers and buyers in the developing market for the refurbished products. The company growth has been phenomenal, with the turnover rising from £350,000 in 2004/05 to a projected £3.5m in 2006/07 - a figure that is expected to double again by 2007/08. The number of employees currently stands at 60 and is increasingly rapidly.

Back in 2003, Petrondas started by establishing links with places such as hospitals looking for a new scanner. He would explain that he could raise funds for their cause simply by them collecting redundant or surplus phones from their donors, patients and anyone else. "They didn't have any trouble persuading people, particularly since they were also helping the environment on account of mobiles being toxic," he says. "It generated an enormous amount of media attention and was very successful, so we knew it was a model that worked."

His next step was to find a way of getting that model to a mass market, which is how the fones4schools campaign was born. This began with a pilot in 100 schools, which generated around 20,000 phones from teachers and pupils. While it used the same concept as the hospital example, Petrondas admits that part of its success also came from the added incentive he put in for pupils.

"I did a deal with the retailer Argos that allowed me to offer every pupil who took part an electronic store card. For every phone they collect, we credit the card with points to use in Argos stores, while at the same time making a donation to the school and even providing education materials on the environment."

It did exceptionally well and two-and-a-half years later, 5,500 schools and four million pupils are registered with the campaign and over £1m has been raised for the education sector. "This department alone now employs 25 staff, so it's an exciting business story," says Petrondas.

It wasn't all plain sailing, he admits. "One of our biggest challenges was that people thought the concept was too good to be true. They kept thinking, 'Where's the catch?' We actually lost some schools because they didn't believe they'd get paid, so we had to work very hard at generating awareness and obtaining backing from the government through local councils."

The most recent significant step for the company was this March's launch of envirofone.com. The first of its kind, this online portal allows customers to "trade in" their old mobile for the current market value and at the same time support their favourite cause or charity. "We've teamed up with Argos again, so registered users of envirofone.com can swap their phone for cash or credit and we have 160 charities as partners."

While the charities promote envirofone to their donors, partner stores or websites are able to offer increased incentives - for example through special offers to people within the scheme.

"Since we launched, we're getting 10 million hits to the site every month and we've paid over £600,000 to consumers for their phones, raising over £140,000 for charities," says Petrondas.

Now ready to enter Europe, Petrondas is all set to launch in the Netherlands later this month, where he is investing €1m into the campaign. Germany is next on the list, followed by Spain and Italy. "Our European ambitions are right at the top of our strategy," he says.

He also has plans to diversify - for example to MP3 players - as well as to expand fones4schools. "We currently have something like 15 per cent of the UK market and we believe we should be able to penetrate 35 per cent of it by mid-2008," he says.

In some ways, Petrondas believes he has been a victim of his own success. "The expediential growth from eight staff to 60 in a short space of time has been a challenge. It's relatively easy to create an ethos of creativity, enthusiasm and commitment in a small company, but as people have come in who weren't here since the beginning, it's been hard to manage that ethos. But by all of us playing a hands-on role and being aware of keeping up the culture, I think we've achieved it."

The business is not without its competitors, but Petrondas remains confident that none have the technology or reputation of Eazyfone. Certainly one of the reasons for the growing interest in this market is the forthcoming WEEE Directive, which aims to reduce the quantity of waste from electrical and electronic equipment and increase its re-use, recovery and recycling. "It's an excellent driver for our business because we're right at the top of the game in meeting the regulations," says Petrondas.

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