Best Buy's Electronics Recycling Freeriders

By Anum Yoon

Did you know that Best Buy offers a free recycling program for used electronics? Anything from a broken computer monitor to an outmoded video game controller can be dropped off at a local store. This is great news for anyone looking to upgrade their old stuff, since most municipal trash services won’t collect electronics that require special disposal.

If you’re like me, you actually didn’t know that, probably because you don’t do a lot of shopping in brick-and-mortar stores anymore. A quick online search for whatever new electronics I need almost always leads me to Amazon, where the prices are low and the shipping is reliable, if not always free.

How, then, is Best Buy’s commitment to sustainability actually, well, sustainable? If it’s taking my old stuff even though I’m not shopping there for replacements, can the company afford to keep offering free recycling?

Amazon’s limited recycling program

It turns out that Amazon does offer an electronics recycling program, though it’s not well advertised. It’s also limited to only Amazon products, and you have to ship the item through UPS. Even though Amazon picks up the cost, you still have to package the item and get it to a UPS pickup site. Amazon also only accepts its own products for recycling, so if you don’t have a Kindle, you’re out of luck.

It’s understandable that Amazon wants to limit its electronics recycling. It’s an expensive process, and it often costs more to shred old products for proper disposal than the company will earn back by selling usable parts and materials gathered by picking over the waste. It’s the same reason why so many people don’t bother recycling their mattresses or appliances – it’s just not worth the hassle.

Best Buy’s gamble

When it started its free recycling program back in 2009, Best Buy stated: “Our hope is to make it a break-even proposition. Depending on commodity prices, it could become a profit center.”

Current commodity prices are low, however, leaving Best Buy to pick up the tab not only for the recycling of products that it sold to consumers, but also for products from other industry giants like Amazon, Sears and Walmart, which score poorly on measures of corporate recycling efforts.

This imbalance creates what economists call the free-rider problem.

The free-rider problem: Not just about money

When Best Buy provides a public good without charge – in this case, free electronics recycling – everyone benefits. The public is more likely to do what’s best for the planet because doing the right thing has been made free and convenient, and everyone benefits from a cleaner environment.

The free-rider problem comes into play when corporations also benefit without having to contribute. In this case, companies like Amazon and Walmart bear none of the costs of electronics recycling, but reap several benefits.

First, electronics recycling makes used plastics and metals more readily available for use in new products, which can drive down the price of these products. Amazon benefits from being able to sell cheaper products just as much as Best Buy would, but without having to help defray the costs of recycling.

By taking it upon itself to provide a public good, Best Buy also made it more likely that the government will not have to step in and mandate electronics recycling – potential regulations that could be hugely expensive for any major electronics vendor. Again, Amazon and Walmart benefit from this side effect of Best Buy’s program without paying any of the costs: the definition of getting a free ride.

Does Best Buy benefit?

Though expensive, Best Buy remains committed to its electronics recycling program. Aside from the environmental benefits to all, the program helps Best Buy by bringing people into its stores. Because recycling drop-offs happen in person, many people who otherwise wouldn’t have walked into the big-box store are taking a look around at what Best Buy has to offer. This can lead to impulse buys on the spot, as well as future purchases once Best Buy has made a place for itself in a customer’s consciousness.

Intangible benefits like good PR and building a strong social media relationship with customers interested in environmental issues are difficult to measure, but important to Best Buy’s overall business strategy. As more consumers become aware of corporate sustainability efforts, their buying habits may change – a future good that should boost Best Buy’s bottom line in the long term.

Buying at Best Buy vs. Amazon

In the end, the cost of buying that new electronic gadget at Amazon’s ultra rock-bottom prices may not be worth the trade-off of its less responsible recycling stance and willingness to be a free rider instead of taking more responsibility. Shoppers will have to weigh their own values in addition to the perceived value of an item when deciding if paying a little more at Best Buy is worth covering the price of its recycling program, which has a major benefit to the world at large.

Image via Splitshire

Anum Yoon is a writer who is passionate about personal finance and sustainability. She often looks for ways she can incorporate money management with environmental awareness. You can read her updates on Current on Currency.