Dear dedicated environmentalist,
Our current curbside recycling systems are tired, outdated, and simply ineffective at ensuring our used goods are successfully recycled into new products. But there is hope on the horizon!
Lasso Loop has designed an at-home recycling appliance to give you the power to change the recycling system from the comfort of your home. Lasso Loop’s first-of-its-kind technology cleans and processes your used plastic, glass, and metal materials so they can be remade into valuable new products.
As we built out the proof-of-concept prototype, a few questions continued to pop up: How much will a Lasso cost? What would be a reasonable price for a machine that will save you time and effort, be a hygienic and odorless place to store your used materials, and guarantee you are doing your part in saving our environment?
THE LASSO VISION
We have critically thought about how our current, curbside system could be rehabilitated to actually successfully closed-loop recycle. This idea led us to blaze the trail for an entirely new approach to recycling; our vision is to create an efficient and effective recycling system, for everyone.
We strive to have a Lasso domestic recycling appliance in every home on the planet, closing the loop on our recycling. In order to do this, we aim to make the Lasso recycling appliance as affordable as possible, as fast as possible. This way we can achieve our mission to empower every household on the planet to not only contribute to but also benefit from the circular economy.
Only by implementing a truly circular economy can we start to address the damaging environmental impact we are stamping on our planet. The Lasso system will allow us to ensure the valuable materials we use every day will have a truly circular life, returning as a product of equal or similar value. Only then are we able to start lifting the toll on our precious environment.
THE HISTORY OF HARDWARE AND APPLIANCES
So how exactly do we figure out the cost of new, innovative, and revolutionary technology?
To lay the groundwork for determining a pricing strategy, let’s start with an example: Why does a fridge generally cost more than a dishwasher? In short, making a fridge requires more material, components, labor, and manufacturing time compared to a dishwasher. Fridges are bigger and require more storage space, whether in the warehouse or at your local retail store. Its size means it costs more than a dishwasher to transport from the factory to the retail store, and then to your home. All these costs add up, which means the sale price of a fridge is generally higher than a dishwasher.
Household fridges and dishwashers have been manufactured for decades. The first domestic refrigerator was sold in the US in the early 1920s1, costing over $15,0003 in today’s money. In those early days, a fridge cost more than the price of an average family car!
In the 100 years since the first fridge was manufactured, new technologies and fierce market competition have meant a dramatic reduction in the cost of manufacturing; so now you can buy an average-sized fridge for anywhere between $1,500 to $3,000. Today, over 99% of US homes have a fridge2.
THE LASSO PRICING JOURNEY
To help our team forecast the appropriate price for a Lasso domestic recycling appliance at launch, we first looked at the comparison between a Lasso and similar appliances on the market. This allowed us to gauge the cost of manufacturing our emerging technology.
As a next step, we calculated a breakdown of our key components, applying an estimated cost (based on assumed units sold) to both parts and labor. This is called a Put-Take analysis, when we use the bill of materials from an existing product as a reference, then take out any components that are not carried through to the new technology. Those costs are then put together with all of the new components, supplying a fair and accurate price estimate. When combined with the market penetration forecast a realistic cost at launch can be established.
To successfully closed-loop recycle, there are multiple components that are needed for both functionality and efficiency. Crucially, a Lasso must include:
- Sophisticated sensors to identify materials (eg. type of metal or plastic, the color of glass, etc)
- Specialized washing, drying, and label-removing mechanisms
- Crushers, grinders, and flakers to reduce the size of containers being processed.
- Separate compartments to store the now cash and environmentally valuable products.
These components create the assumed cost of each individual Lasso appliance, making our revolutionary technology slightly more expensive than the average refrigerator.
In fact, if we compare the in-depth technology of the Lasso and a fridge, we find the Lasso is significantly more complicated and therefore should be more expensive.
Additionally, when someone invents a new piece of hardware from scratch, they need to establish and grow the market without specific manufacturing facilities in place; which means everything needs to be done on a smaller scale. Smaller-scale typically means a higher cost, temporarily, until demand increases, and the economies of scale drive down manufacturing and component costs.
The current cost of an average fridge is around 70% less expensive than the original price tag when it was first released in 1921, factoring in inflation and market value. We expect the Lasso to follow a similar trajectory, with a decrease in price as the Lasso manufacturing capabilities reach scale.
With the completion of the Lasso proof-of-concept prototype at the end of 2021, we were able to forecast a retail price tag of $5,000, based on component, labor, and typical supply chain costs.
FUTURE LASSO'S
Our vision is to take the worry out of recycling, working towards a system that benefits everyone and our planet. Ultimately, our team here at Lasso aspires to a system that will allow users to profit from the raw materials they process. This is a goal that would essentially pay the Lasso appliance off, in full, within 3-5 years, significantly less than rooftop solar panels or electric vehicles. Why wouldn’t users want to recycle when they’re making money?!
Within the first 5 years, as market penetration increases, allowing the economies of scale to take effect, the retail price will drop (estimating up to 50%), making the appliance more affordable.
After a few years from the first roll-out, we expect appliance leasing companies will view Lasso as a viable appliance. This will enable Lasso’s to be leased, rented, or bought under hire-purchase arrangements, allowing the upfront purchase cost to be distributed over several years.
During our initial rollout, purchasing a Lasso will be slightly more expensive than the average fridge, due to the complexity of the machine. However, supporting Lasso in these early stages is vital to our survival, bringing a recycling system that actually recycles to life. Just as fridges and dishwashers became more affordable, so will Lassos; we expect that owning a Lasso will become increasingly popular when people realize the monetary and environmental value of the materials it processes.
The more we all use the Lasso, the more money we can see in our own pockets and the greater positive impact we make on the environment around us. This is great news for anyone invested in cultivating a truly sustainable, circular economy. We are right here, ready to change the world of recycling for the better.
Interested in learning more about Lasso, our team, and how we’re changing the world? Subscribe to our newsletter, follow us on social media, and keep up with all things Lasso by reserving your Lasso appliance today!
Sustainably yours,
Aldous
Founder + CEO
Watch this quick video from our CTO about the proof of concept prototype, and where it stood in 2020:
Sources:
1. https://www.materials.sandvik/en/campaigns/fridge-of-the-future/the-history-of-the-refrigerator/
2. https://fee.org/articles/thanks-capitalism-refrigerators-are-awesome/#:~:text=According%20to%20the%20latest%20government,rate%20to%20be%2013.5%20percent
3. https://www.in2013dollars.com/us/inflation/1921?amount=1000
