You don’t have to be environmentally minded to hate throwing away stuff. Common sense suggests that discarding phones every other year, discarding clothes after a year and discarding cars every five years is a bad idea for your finances (remember, if you are a Marcellus client, every rupee you spend is a rupee you could potential compound 10x in 10 years given the construct within which we compound our clients’ monies; so that Rs 40 lakh car that you are thinking of buying, actually is Rs 4 crores of investment returns foregone). Whilst smart companies like Patagonia have for decades now requested their customers NOT to buy new products from them (instead get the old ones repaired), a far more influential company seems to have come to its senses now: “On Wednesday, Apple Inc. announced that it’s giving consumers a new choice. Starting next year, it will let them access Apple parts and tools to address the most common repairs, such as battery and screen replacements. It’s a monumental decision: It will reverse the company’s long-standing opposition to self-repair, expand consumer choice, reduce harmful emissions and potentially set the stage for a revolution in repair-friendly product design”
The world in which we grew up, you bought stuff with the expectation that it could be and would be repaired regardless of whether it was your new school uniform or the Black & White TV in the living room. So how did things change? How did we suckered into mindless ‘upgrades’: “….thanks to globalized supply chains and manufacturing, the real cost of durable goods like TVs has been dropping for decades. For many consumers, it’s now easier and cheaper to throw out a $200 flatscreen and upgrade than it is to attempt a repair. As a result, manufacturers had few reasons to build out expensive spare-part supply chains.”
So what brought about Apple’s change in heart? “For more than a decade, “right to repair” activists have been lobbying state legislatures and federal officials to prohibit anti-repair practices. In March, those activists scored a major victory when President Joe Biden issued an executive order calling for an end to repair monopolies. For Apple, the writing was likely on the iPad: expand repair options voluntarily, or fight a losing battle to resist.”
So, what happens next? Will we spend our weekends repairing our Apple products? “It won’t just be iPhone owners who benefit. Apple’s influence on consumer technology is so extensive that its decision will likely be emulated by others, boosting “repairability” as a device feature. Meanwhile, the booming global secondhand market should see an influx of devices that have either been repaired or can be. In turn, consumers in emerging markets could benefit hugely. Crucially, all of these developments will also be helping the environment.
Of course, Apple isn’t reversing course entirely out of the goodness of its corporate heart. Independent shops that want to use Apple-certified parts must still join the company’s Independent Repair Provider Program and agree to its invasive terms.”
If you would like to read about a visionary business leader who saw all of this coming 30 years ago and went on to build a very successful company, you might want to read “Let My People Go Surfing: The Education of a Reluctant Businessman” by Yvon Chouinard, the founder of Patagonia.
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Note: the above material is neither investment research, nor financial advice. Marcellus does not seek payment for or business from this publication in any shape or form. Marcellus Investment Managers is regulated by the Securities and Exchange Board of India as a provider of Portfolio Management Services. Marcellus Investment Managers is also regulated in the United States as an Investment Advisor.
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