Feeling the pinch of the slowing economy, one of the nation's most active PET container recycling and resource groups has reported the loss of two significant members, as well as staff cuts.
Two major PET bottle machine makers - Husky Injection Molding Systems Ltd. and Groupe Sidel's North American arm - did not renew 2001 membership with the National Association for PET Container Resources at the beginning of the year.
As an indirect result, the Charlotte, N.C.-based association was forced to cut two jobs, including the position held by E. Gifford Stack, former vice president of environmental affairs with the National Soft Drink Association.
Stack had joined NAPCOR last year to work on improving collection rates for single-serve PET containers.
NAPCOR President Luke Schmidt said the impact of the two machinery suppliers' departure was doubled when NSDA decided not to continue to fund Gifford's position.
``Unfortunately, NSDA encountered a significant budget shortfall and elected to discontinue all funding for this program, which made it difficult for us to support that position,'' Schmidt explained. About that same time we had those two members drop out, [Sidel's and Husky's] equipment sales in North America really slowed down.''
Schmidt said the job cuts are not the direct result of the lost membership, but both events are the result of weakening financial performance in the PET container industry.
``We certainly regret having to take that step, but like any other industry, we've had to face these issues,'' Schmidt said in a June 1 telephone interview. ``Even though it certainly could be viewed as negative news, we are moving forward and continuing our efforts.''
The move does slow down the organization's nationwide single-serve PET bottle collection efforts - which started rolling with studies that were completed last year in Columbia, S.C., and Albuquerque.
``[Stack's absence] makes it a little more difficult to do, but we have three talented regional directors who have picked up the slack,'' he said. ``We continue to support [single-serve PET bottle recycling] as much as we can.''
The Albuquerque and Columbia projects had placed collection bins at convenience stores and other small retail sites to boost recycling of 20-ounce PET soft drink and water bottles. Schmidt said the trial proved a great need for nationwide placement of the bins for single-serve bottles at the point of consumption rather than the point of purchase.
``We're continuing our efforts to place bins at various places of consumption: employee vending areas, airports, golf courses, college campuses,'' Schmidt said. ``We've placed 27,000 bins in the U.S. and Canada. The bins are very popular.''
Schmidt did not disclose how much NSDA had provided to fund Stack's position. Nor did he disclose how much Husky and Sidel paid the organization in annual dues.
However, he said typical membership for suppliers is based on their sales generated from PET-related business. Companies with PET-related sales of up to $49 million pay $25,000 per year. Those firms with sales of more than $50 million pay $50,000 in annual dues.
Husky and Sidel were among the first machinery companies to join NAPCOR when the group opened membership to equipment suppliers about four years ago, Schmidt said. Most NAPCOR members are PET blow molders or resin suppliers.
Husky and Sidel both experienced losses either in North American profit or sales in 2000. Bolton, Ontario-based Husky announced cost-cutting measures within the company as a result of a 25 percent decrease in North American sales.
Husky insists the NAPCOR decision in no way reflects a departure from the firm's environmental, health and safety activity.
``Our decision to discontinue membership in NAPCOR was difficult, but it will allow us to invest in other internal programs with more immediate impact,'' spokesman Richard Carter said in a June 4 letter.
Sidel U.S. spokesman Michel Picandet said his company was being stretched too thin with association memberships, and had to narrow down affiliation to one recycling-oriented group per country. In the United States, the choice was the Arlington, Va.-based Association of Postconsumer Plastic Recyclers.
``Sidel worldwide is a very active supporter of any recycling move and association. Unfortunately we have been supporting more and more associations in different countries,'' Picandet said from Sidel's U.S. headquarters in Norcross, Ga.
``Because of the work we have made with the Actis [bottle-coating] system, that did push us in the direction of associating with APR.''
The Le Havre, France-based company's 2000 results revealed a 16 percent increase in sales, but a 67 percent drop in profit, compared with 1999.
Schmidt said the news isn't as bad as it sounds regarding machinery-related members.
Netstal Machinery Inc., a Devens, Mass., subsidiary of Nfels, Switzerland-based Netstal-Maschinen AG, joined as a supplier member in February. And he said both Sidel and Husky have expressed interest in renewing membership when business improves.
``We're delighted to have Netstal; Netstal is growing in this country,'' he said. ``We think they're going to play an important role in NAPCOR. We're actively discussing potential memberships with [other machinery] suppliers.''