The simple idea of helping resin buyers save money started a journey of 20 years and counting for Resin Technology Inc. and co-founders Garland Strong and Bill Bowie.
Those two were working together at injection molder Doskocil Manufacturing Co. Inc. in Arlington, Texas, when they decided to use their resin buying tactics to start their own firm. RTI then opened its doors in 1998 in Fort Worth, Texas.
RTI marked its 20th anniversary at NPE2018 with the theme Champions of Resin.
"At Doskocil, we knew we had to do something to get a competitive advantage on resin, since it was 60 percent of our total cost," Strong said.
Doskocil had hired Bowie to focus on resin buying, primarily for polypropylene. He had done similar work buying polyethylene for film extruder Poly-America Inc. in Grand Prairie, Texas.
Doskocil soon began doing its own compounding work through its Spectrum Polymers unit. That step and other moves soon increased Doskocil's annual EBIT from 6 percent to 18 percent.
"We knew then that we had a good model to go out and call on the processor market," Strong said.
Bowie said he had "identified the need" for better resin buying in his five years working at Poly-America for owner Steve Ross.
"I learned that if you had one guy at your company buying machinery and steel and paper cups and everything else, then in the afternoon a guy from Dow or ExxonMobil shows up to sell him resin in a nontransparent market, he's just going to say, 'Tell me what the price is,'" Bowie added.
RTI's gain-share model — where their compensation is based on how much they save their clients on resin costs — also sets the company apart.
"We weren't going to make money unless we saved you money," Strong said. "And to prove it, we could point to the success we had at Doskocil."
"We were saying that if we can't deliver, you shouldn't have to pay us," Bowie recalled. "We can improve the bottom line and share in that gain. The reality of that gets a client's attention."
RTI then began to build its employee roster by hiring veteran resin supply executives. These new employees "had the knowledge base that we didn't have," Strong said. "They knew how the resin companies functioned and operated, and they also had networks of resin contacts and close customer relationships."
Pairing these resin market veterans up with large resin buyers "was like putting a race car driver in the fastest car in the world," according to Strong.
"Every [resin buyer] thought they were getting the best deal," Bowie added. "Then they realized we had information that they didn't have access to."
The model caught on to the point that RTI now employs a staff of around 20 and has more than 100 clients who are involved in more than 15 billion pounds of resin transactions every year. The firm estimates it works with clients who purchase a combined 12 percent of all the resin sold in North America annually.
"Our people have brought a depth of understanding to the market," Bowie said. "We've kept our reports simple and kept our loyalty and personal touch.
"Our people are always available, and we call clients when changes in the markets happen," he added. "That lets them know they're on a level playing field with their suppliers."
This success has allowed RTI to branch out and help clients in purchasing other products. In 2008, the firm began consulting on purchases of finished plastic products such as food containers. In 2013, it added paper products to its purchasing lineup.
"We've been able to use the same principle on paper as we did with plastic," Strong said. "A lot of our clients were buying both plastic and paper."
Strong and Bowie last year decided to become managing partners at RTI, leading to Pete Suerken being named president of the firm. Suerken had been an RTI client since 2011 while with Restaurant Supply Chain Solutions LLC of Louisville, Ky. He joined RTI's advisory board in 2012.
In a recent phone interview, Suerken admitted that when he was a potential client, RTI's service "was a hard sell at first because it's such a different business model; it almost sounds too good to be true."
But Suerken then saw that the RTI formula worked, and he's now focused on keeping that model going.
"The challenge is sticking with what we're good at," he said. "We still have the industry experts, and the value proposition is still there."
RTI's 20th anniversary, according to Suerken, "marks an important milestone for the company as we look back on our heritage of talent and accomplishments."
He added that RTI "is investing in new generations of talented staff, and we continue to celebrate long-term business relationships."