Patents, IoT and R&D to innovate the lubricant supply chain through a circular approach
In the lubricants and energy sector, competition no longer depends only on raw material prices. Today, European regulations are stricter. In addition, digital traceability is becoming mandatory, while ESG models are reshaping the market.
As a result, companies must rethink how they manage the entire supply chain. In this context, waste oil management becomes a key turning point. It is no longer just an environmental cost. Instead, it becomes a real industrial opportunity.
At this strategic stage, SGM Energy Srl – a Benefit Corporation and Innovative SME – has taken a clear direction. The company invests in intellectual property, digital infrastructure, and applied research. Its goal is to turn oil collection and regeneration into an integrated Industry 4.0 system.
The limits of the traditional model
The global lubricants market exceeds $160 billion and continues to grow. However, many operations still rely on outdated, analog processes.
Even in Italy, which reaches a regeneration rate close to 98%, collection systems often remain inefficient. In fact, operators still use passive containers without monitoring or data connection.
“The traditional collection point is just a double-chamber container. You dispose of waste, and someone later collects it. However, you do not know when it is full, who delivered the waste, or its quality,” explains Vincenzo Mignano, inventor and researcher at the company.
Because of this lack of data, companies face logistical inefficiencies and higher costs. Moreover, the quality of recovered material decreases. As a result, regeneration performance also drops.
The patented digital supply chain
SGM’s approach starts from a clear idea. Digitalizing the supply chain means protecting it, controlling it, and making it more profitable.
Industrial Invention Patent No. 102018000007756 protects a method that digitalizes the lubricants and energy products supply chain. This system makes production, storage, and handling fully traceable from both fiscal and environmental perspectives.
In addition, Patent No. 102021000031727 covers an IoT monitoring system. This system allows remote control of industrial assets.
“We did not develop simple software. Instead, we patented a method that digitalizes each step of the supply chain. In this way, every process becomes structured, traceable, and defensible,” says Mignano.
The proprietary system “SGM Ecosystem Process 4.0” integrates RFID, sensors, and automated regulatory registers. Therefore, it reduces human error and lowers compliance risks.
Moreover, the sector faces increasingly strict fiscal and environmental controls. For this reason, automated compliance becomes a real competitive advantage.
The smart collection point
On top of this system, SGM has developed a visible innovation: the “Smart Distributed Collection Points,” registered as a European Community design.
These are no longer passive containers. Instead, they are IoT-enabled nodes connected to the company database. They include level sensors, geolocation, and identification systems such as NFC and smart cards.
“It is an intelligent collection point, not a passive one. It connects directly to our database. Therefore, we can monitor in real time what is collected, how much, and when to schedule pickup,” explains Mignano.
Thanks to constant measurement, companies can implement predictive logistics. As a result, they reduce empty trips and improve environmental performance.
At the same time, they can classify waste at the source. This allows a clear distinction between mineral and vegetable oils. Consequently, regeneration efficiency increases.
“If you measure the weight and know when the container is full, you avoid unnecessary transport. Instead, you plan targeted collections. This reduces both costs and environmental impact.”
Research, analysis, and barriers to entry
The digital infrastructure is supported by an investment of about €1 million in an internal analytical laboratory. The lab is currently undergoing ISO/IEC 17025 accreditation.
This facility allows chemical analysis of waste oils, evaluation of regeneration potential, and continuous development of new formulations.
“We built an analytical structure to identify the type of waste and support continuous research and development. Our goal is to achieve national and international accreditation.”
This combination creates a strong competitive barrier. It includes patents, an internal lab, a connected Industry 4.0 plant, and an authorized tax warehouse.
Therefore, the company does more than trading or storage. Instead, it operates as an industrial ecosystem. It combines physical assets and digital platforms in a “Virtual Factory” model.
From volume to value
Today, the lubricants sector is shifting from a volume-based model to a value-based one. Margins no longer depend on commodities alone. Instead, they come from services, traceability, and circular economy capabilities.
In addition, demand for regenerated base oils continues to grow. Products compliant with Green Public Procurement criteria are also increasing. Therefore, this trend is strengthening.
“We do not want to be simple suppliers. Instead, we aim to be a technological hub. We provide a structure that allows operators to work with more control, more safety, and higher margins,” concludes Mignano.
Today, working with SGM means accessing a patented infrastructure. This system integrates digital supply chain management, smart waste oil collection, and applied research.
In a changing market, success no longer depends on selling more volume. Instead, it depends on managing the system more effectively.
