VARs frustrated with roll-out of Ontario recycling program

Published: March 23rd, 2009

In just over one week every desktop computer, laptop, television and printer sold in Ontario will incur an electronics recycling fee, and many in the VAR channel are still expressing frustration with a lack of information about the program, and what it will mean for their businesses.

As of April 1st, most electronics products, from computers and monitors to peripherals, sold in Ontario will accrue a recycling fee that VARs and resellers will need to pass on to their customers, and may need to collect, report and remit to Ontario Electronic Stewardship (OES), the organization responsible for implementing the Waste Electrical and Electronic Equipment (WEEE) Program Plan for the Ontario government.

Most resellers that purchase through distribution will likely be charged the fee by their distributor, although they may decide to become a fee and remit the fee directly. Either way, they’ll need to either absorb the fee or pass it on to their customers.

The OES answers reseller questions

In this document released by the OES following its last Webinar for retailers and other industry stakeholders, the OES attempts to answer the many questions about the program raised by resellers and retailers during the conference call.

Click to download the PDF.

Howard Tuffnail, senior vice-president, finance with distributor Tech Data Canada, said the VAR channel is frustrated with how the program is been rolled-out and the lack of proactive engagement from the OES around a program that has been in development for a couple of years..

“So much of this is just bubbling to the surface in the month of March, less than 30 days prior to the implementation of the program,” said Tuffnail. “The first Webinar was (two weeks ago). That’s a little too late.”

Tuffnail said VARs quoting today for business that may not happen until July need to be including these fees, and many VARs have business already on the books for post-April 1st that will incur these fees. They’ll either need to renegotiate with their customers, or eat the fees.

“I think there’s a lot of confusion around the roll-out of this program. Tech Data was never approached as a key player in this supply chain, no one ever reached-out for our views and input on how to potentially implement this,” said Tuffnail, adding he does understand the green merits of the program, and it was launched for the right reasons.

“Legislation gets enacted, but then you’re left with the implementation and it’s been left to the last minute. It has created a world of confusion, and people grasping for answers.”

Wayne Blaby of Cavan, Ont.-based reseller Computer Solutions “Plus” said he first received a letter about the program from the OES in January, but having no idea “who the hell they were or what it was” he just set it aside, and it didn’t come back onto his radar screen until he read media coverage two weeks ago.

“At that point I hadn’t heard a thing from my suppliers, including EMJ, ASIand Synnex,” said Blaby. “I contacted my sales rep (at Synnex) and he didn’t know about it either.”

He said he has since been able to get more information from the distributors and in the past week he’s heard from some of his smaller suppliers wanting to know if he’ll be a remitter or a payer. He added he has yet to hear from ASI, one of his larger suppliers, but not wanting any more paperwork and doing business primarily in Ontario Blaby expects to be a payer, not a remitter.

Blaby added a current pre-occupation, and concern, of the reseller community is figuring-out how to advise customers of the fees.

“No one wants to be seen as charging something that someone else is trying to hide somewhere,” said Blaby.

He expects to build the fee into the bottomline cost with a note on the invoice indicating the figure includes the government-mandated advance disposal fee. Blaby added he’s concerned through that some smaller, less reputable resellers could attempt to skirt the fees by purchasing from Quebec suppliers and then not registering to pay the fees as the first importer to Ontario. Such resellers would have a cost advantage, albeit an illegal one.

OES documents also indicate that end-user businesses that purchase electronics for business or personal use over the Web from suppliers outside of Ontario could avoid the fee, giving on-line out of province players a cost advantage over Ontario resellers.

A spokesperson for OES declined to comment for this article, telling CDN the organization was “going quiet” to build anticipation for the official program roll-out March 31st. Instead, the OES encouraged the community to join the next OES Webinar for stakeholders on March 24th.

Tech Data Canada controller Daryl Rosien said the last OES provided a good deal of information, but it also may have raised more questions that it answered. Rosein added that, just over one week from program launch, he’s still waiting for some key documentation from the OES.

“One challenge we have is the remitters agreement is not yet published to the OES Web site,” said Rosien, noting publication has been promised last week. “They’re struggling to get it out as soon as possible, but we’re challenged for details.”

Ontario electronics recycling fees

Effective April 1, 2009:
Desktop Computers: $13.44
Portable Computers: $2.14
Computer Peripherals
(Mice, Keyboards, Single Hard Drives, Optical Drives): $0.32
Monitors: $12.03
Televisions: $10.07
Printing Devices: $5.05

For more information, visit:
Ontario Electronic Stewardship