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A clean-up act in Ahmedabad

Let's Recycle is revolutionising dry waste mgmt in the city; expanding a challenge

Vinay Umarji 

Let's Recycle founders Ravi Patel, Chirag Patel, Sandeep Patel & Dhrumin Patel
Let’s Recycle founders Ravi Patel, Chirag Patel, Sandeep Patel & Dhrumin Patel

Soon your kabaadiwala (scrap dealer) could be seen wielding a smartphone and calculating how many green points you have earned even as he weighs old newspapers and other dry waste at your doorstep.

That is the vision shared by Sandeep Patel and his partners Dhrumin Patel, Chirag Patel and Ravi Patel at the Ahmedabad-based Nepra Resource Management, the start-up behind Let's Recycle. Launched in December 2011, the venture has revolutionised dry waste collection and management in Ahmedabad.

Let's Recycle aims to build an organised and reliable dry waste supply chain across India by connecting generators of waste and informal waste collectors with recyclers.

"We handle all dry waste, be it old newspapers, cardboards, plastics, glass, wood or metal. We collect everything from houses, enterprises and roadside waste pickers and sell these to recycling firms," says Sandeep, co-founder and chief executive of Nepra. The company follows a standardised system of quoting rates its clients.

Early days
Nepra was founded in 2006. Before that, Sandeep, Chirag and Ravi had spent four-five years researching opportunities in dry waste collection in the city. "We were into chemical trading at that time. We wondered how the dry waste the local kabaadiwala collected could be organised and converted into a scheduled service… we got our big break from Larsen & Toubro (L&T) in December 2011," Sandeep recalls.

L&T sought to clear dry waste at a solar park in Charanka village Gujarat's Patan district. Nepra grabbed the opportunity. Within 24 hours, it cleared loads of thermocol from the site.

"By January 2012, we had roped in our fourth core partner Dhrumin, a go-getter. We began approaching hotels, offices and hospitals for dry waste collection. By March 2012, we got Biplab Paul and Ravi Kalantri on board; they helped us tap roadside waste pickers and develop a dry waste collection software, respectively," says Sandeep.

He added Nepra's drive to work ethically and transparently led to the development of the Let's Recycle software, which was transformed into an enterprise resource planning system that used certified weighing scales. "The waste picker gets 30 per cent extra by selling his dry waste to us because we give him the exact price for up to three decimal points on the weighing scale, which no one else does," Sandeep says.

Soon, Let's Recycle began daily collecting an average 70 kg of dry waste from the city everyday.

Business model
Today, about 80 per cent of the average 6-6.5 tonnes a day of dry waste comes from rag pickers; the rest comes from hotels, offices and residential complexes. The dry waste is brought to the company's multi-commodity material recovery facility, where it is segregated and passed through a stringent quality check to meet recyclers' needs and standards. Subsequently, these are sold to recycling firms.

The company also has an exclusive plastic-processing facility. Of the dry waste collected, about 55 per cent is plastic, while 35 per cent is paper and cardboard.

Nepra has developed a cloud-based enterprise resource planning system and a smartphone application that connects its employees with clients. "Daily, the quantity of waste collected is recorded online and our clients are informed of the quantity, the commodity and the carbon emission mitigated by these. The app, however, is in beta stage, as we are looking to add more to it," Sandeep says.

Funding

"Currently, just nine of our vehicles and 20 people are into waste collection. And, we are yet to break even. Therefore, servicing residential premises tends to be a costly affair. However, we are hoping to raise more funds in the near future to fuel expansion," says Sandeep, while refusing to divulge the details of the company's fund-raising.

Nepra has invested about Rs 1 crore into Let's Recycle through internal accruals from its previous chemical trading business.

Recently, Aavishkaar Venture Fund had invested in the company. "There are challenges in waste-handling, especially in executing and scaling up the business. But in Nepra, we found an exciting model that could develop an entire value chain of collection, involving rag pickers and engaging them in the mainstream," says Ajay Maniar, principal, Aavishkaar Venture Management Services.

Future
Let's Recycle plans to go the franchisee way; local scrap dealers or waste pickers can be a franchisee collector for Nepra and earn commission on the dry waste collected. The company also plans to enhance waste collection from residential areas and expand into other cities.

Maniar believes with consumerism on the rise, an increasing number of people are open to organised dry waste collection, though there are challenges in replicating the model in other cities. For now, Nepra plans to consolidate its business in Ahmedabad.

Last year, the company recorded a turnover of Rs 1.68 crore, against Rs 40 lakh in 2011-12, the first year of operations. This year, Nepra hopes to record revenue of about Rs 3 crore, owing to increased collection and fund infusion from Aavishkaar.

Stating a broader vision, Sandeep says, "Five years down the line, I will have the analytics data of dry waste generation in the country."

EXPERT TAKE
Harish Pattnaik
Scalability will always be a problem in the dry waste collection and management business. The start-up should expect to face problems related to technology, logistics and collection. In this business, the risk, too, is very high. Collection of dry waste is not easy, owing to the presence of an unorganised mafia that prevents organised player from entering the market. Moreover, unlike some western countries where citizens are used to dumping waste in a systematic manner, in India, everything is mixed up. Here, we try to discard dry waste along with wet waste. Therefore, segregation becomes expensive and costs are high.

Scalability will always be a problem in the dry waste collection and management business. The start-up should expect to face problems related to technology, logistics and collection. In this business, the risk, too, is very high. Collection of dry waste is not easy, owing to the presence of an unorganised mafia that prevents organised player from entering the market. Moreover, unlike some western countries where citizens are used to dumping waste in a systematic manner, in India, everything is mixed up. Here, we try to discard dry waste along with wet waste. Therefore, segregation becomes expensive and costs are high.


Harish Pattnaik
Managing Director, Gujarat Venture Finance Ltd (GVFL)

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First Published: Mon, March 03 2014. 00:48 IST
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