Ecoark Holdings Inc., a maker of recycled-content trash cans, has taken a big step to vertically integrate operations through the acquisition of Sable Polymer Solutions LLC.
Ecoark, through its Pioneer Products LLC subsidiary, had been buying recycled resin processed by Sable for years and sending that material to manufacturers who made its 45-gallon trash can.
By taking recycled resin processing in-house, Pioneer Products hopes to open up new business opportunities.
Sable, of Flowery Branch, Ga., collects a variety of post-consumer and post-retail rigid plastics, such as bakery containers and bulky plastic products returned to retailers, to create its resin blends. Sable also buys resin to help meet its demands.
The recycled plastic is then shipped to companies that manufacture Pioneer's trash can.
President Roshan Weerasinghe of Pioneer Products said controlling the supply of recycled resin helps the firm become a stronger company that can now start looking beyond its flagship trash can product.
“We take this product and we go through a process that we have a proprietary formula that we use. We grind up all these plastics and we made a resin pellet that fits the profile for those trash cans,” he said. Once those outside manufactures produce the trash cans for Pioneer, the company then manages the supply chain from that point on.
Sable receives “a whole myriad of stuff that comes out of the retail area that normally goes to a landfill. We actually process that, we grind it and go through a process where we then make the resin pellets,” Weerasinghe explained.
Along with providing recycled plastic feedstock to its own manufacturing, the recycling operation also supplies both recycled plastic flake and pellets to other manufacturers for their own products.
Now that Sable is now under Pioneer Products, the company hopes to use that combination to expand its product offerings, Weerasinghe said.
“We thought it was a good vertical integration. We wanted to do a lot more synergies. We're building a wider and larger portfolio of products that we want to manufacture as well over time,” he said, without being specific.
Acquiring Sable also allows Pioneer Products to also keep a lid on costs. “It all comes down to cost is a big factor in that industry, and that helps us keep our costs aggressive,” Weerasinghe said.
As part of its plan to expand business, Rogers, Ark.-based Ecoark also is partnering with a company called Retail Monster LLC to help expand distribution of the company's products across the United States.