New Wave Plastics was getting cramped in its 20,000-square-foot building in Medina, Ohio. So the 5-year-old recycler moved north to Cleveland — into a former heavy-manufacturing building with 20 cranes and 120,000 square feet of space.
The giant building will help New Wave Plastics continue to expand beyond its original core of credit card waste into a broad-based recycler of all types of plastic, and even do brokering of some scrap metal, company officials said.
In Cleveland, the main bay has cranes with a lifting capacity of more than 200,000 pounds, said T.R. Mitchell, who co-owns New Wave with Tony Lotts.
Mitchell said New Wave needs all that space to classify, process and store different materials, then find buyers. “The distribution side of our business is big. We need that amount of space for storage,” he said.
In Medina, employees had to shuttle material back and forth between the main building and two separate rented warehouses.
The company employs 26 people and expects 2011 sales to exceed $5 million.
Mitchell said that recycling of credit card waste accounts for about 10 percent of total business today. But in 2006, when Mitchell teamed with Tony Lotts, credit card scrap was the company's only market — and ended up providing the link to the big building in Cleveland.
Mitchell, Lotts and Doug Coates, director of sales, reviewed the company's history and looked ahead during an interview at the plant earlier this year. Crews were moving equipment from Medina into the Cleveland factory, the former plant of Soberay Machine and Equipment Co., a rebuilder of rubber and tire machinery. New Wave has purchased the building.
Part of the Cleveland industrial building also used to manufacture presses to laminate credit cards. As the vice president of sales and marketing, Lotts knew all the players in that industry. So it was natural that, when Lotts and Mitchell began talking about business opportunities in recycling, credit card waste came up.
“We were trying to figure out, OK, what material would we start with?” Mitchell recalled. “We didn't want to be a broker, or somebody who's just staging plastics for overseas sales. So we said let's look at the credit card industry and see what kind of stuff they're generating.”
They picked up a client in the Cleveland area, then began working with the Boltaron Performance Products LLC plant in Newcomerstown, Ohio, a major maker of calendered PVC credit card stock.
Klöckner Pentaplast Group bought the card stock and rigid graphic arts business last year, and now New Wave supplies Klöckner with the recycled PVC credit card material.
When they founded New Wave, the partners recognized that credit card stock recycling was an underserved market. Credit card companies buy PVC sheet stock, then laminate and produce the finished cards. They generate trim waste.
The card makers were selling to local recyclers, which exported the material outside of the United States, Mitchell said. Much of it also ended up in landfills.
Lotts said New Wave filled a need. “Recycling in the card market was not very big. Nobody had developed any use for the material because of the contamination problem,” he said. “That's when T.R. and I partnered up, and we developed some proprietary processes for separating this material. That's what really opened the door for us to move into this market.”
New Wave closed the loop, by developing a technology to separate credit card waste and identify the clean material. The material gets reprocessed and then shipped back to the card stock manufacturer, to be made into new credit card stock.
“We had a perfect solution for taking it out of the landfill,” Lotts said. The company's tag line is: “giving the earth a credit.”
Mitchell said delivering high-quality recycled material is critical to the credit card sector.
“Credit card stock is very sensitive. You can't have contaminants. You have to print on it, and if it's going through a printing press, you can scorch the blanket. And PVC's not forgiving, like some other polymers. So we need to send them only very, very clean material,” he said.
Of course, the industry is not just about credit cards. The proliferation of debit cards, automated teller cards, smart cards and frequent shopper cards ensures a steady stream of recycled material.
When the PVC regrind is not clean enough for credit cards, New Wave sells it to the building products sector.
The company set up a complete distribution system, staging empty semi-trailers at customer plants, and then picking the full ones up. “We supply them with gaylords and pallets to restock them, to fill the containers,” Mitchell said.
Broad-range recycler
New Wave's diversification into other types of plastics and non-plastic materials came when customers from the credit card side asked if they could put more stuff into the New Wave trailers, from corrugated cardboard to packaging film. “We became a total waste solution for the credit card industry,” Mitchell said. “Now we've turned into a recycler with kind-of a distribution aspect. No matter what material hits our floor, it has a home inside the plant.”
That has become a hallmark for New Wave, which now has 15 trailers staged at customers and three semi trucks to haul them away. “If any manufacturer calls us for a recycling situation, where they have plastic and they have other things, we go in and we put a whole proposal together for them, for everything. So they don't have to deal with five recyclers,” Mitchell said.
Coates said that for smaller customers in northeast Ohio, the company has smaller trucks that drop by to pick up two or three bales of material, or one gaylord a month.
“The guy who has 5,000 pounds of waste, nobody wants to deal with them. But we have the 24-foot straight trucks, so we can accommodate that guy and he can actually get paid for the little bit of scrap he has. We have homes for it,” Coates said.
That includes old scrap machinery. “Just throw it on the truck. We call a local steel recycler and they come get it,” Coates said.
New Wave now deals in all types of plastic. According to the Plastics News recyclers ranking, the company handled 36 million pounds of plastic in 2010, 90 percent of it from post-industrial sources.