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October 23, 2018 02:00 AM

Poly-Wood plans for massive growth

Steve Toloken
Assistant Managing Editor
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    Poly-Wood LLC
    Poly-Wood LLC turns recycled HDPE into plastic furniture and lumber. The company is planning for massive growth.

    Plastic furniture maker Poly-Wood LLC is investing $35.3 million in a new factory in North Carolina, the most recent in a series of investments that have seen the company add substantial manufacturing capacity and take on outside investors.

    The Syracuse, Ind.-based company, which uses recycled HDPE as its raw material, will add up to 20 extrusion lines at its new Roxboro, N.C., facility, on top of 15 lines in place at its headquarters in Indiana. The North Carolina plant will also expand the company's plastic recycling capacity.

    “We have experienced exponential growth now for over 15 years,” CEO Doug Rassi said in an email interview.

    Poly-Wood makes outdoor tables and chairs, including a signature line of Adirondack chairs. To meet growing demand, Rassi said the company has developed a customizable, made-to-order business model to accommodate both brick and mortar stores and online sales through national chain stores.

    The East Coast investment comes after the company in 2015 doubled the size of its Indiana plant with a 260,000 square foot expansion, going from 250 employees to just over 500. Rassi said “additional planning for the Indiana campus is in the works.”

    “Our goal is to reach 900 employees by 2023 as we continue to grow in Indiana and ramp up the facility in North Carolina,” he said. “It's really the result of a well-executed plan in the grandest sense. To scale at this rate requires foundational planning.”

    The North Carolina expansion was first disclosed in an Oct. 16 press release from North Carolina state economic development officials, who said the Roxboro plant will create 384 jobs over five years. Rassi expanded on the plans in an Oct. 22 email.

    He said the Poly-Wood has developed manufacturing systems that can quickly fill orders for thousands of different product variations.

    “[The company] has a very unique manufacturing model,” he said. “We presently have over 15,000 unique SKUs [stock keeping units] for sale. We have the capability to build any of them on demand and ship the next day. Regardless of the origin or destination or nature of the transaction our system sorts it all out.”

    The company sells both through smaller retailers and through the websites of national chains including Home Depot and Target.

    “Many in our industry have talked about e-commerce or bricks and mortar as if one must make a choice or have a preference as a selling channel,” he said. “Our vision of the future embraces both. More importantly we obsess [over] how the physical and digital worlds might work together to serve our customers.”

    In 2015, two Indiana-based investors, Oxford Financial Ltd. and Cardinal Equity Partners LLC, recapitalized Poly-Wood to help fund growth plans.

    Poly-Wood's website said Rassi and a business partner, Mark Phillabaum, started the company in 1990 when they noticed government recycling programs were creating “steadily growing mountains of recycled plastics” that could be used to make plastic lumber and build furniture.

    In last three years, the company has also expanded into more plastics recycling in-house, rather than buying resins from others. The North Carolina factory will include recycling operations similar to what the company has added in Indiana, Rassi said.

    Rassi said through most of its history, the company focused on product design and manufacturing, and now that resin volumes are getting large enough, it's investing into more recycling.

    “For us it is a matter of business decision priority,” he said. “Our early work has gone into the design of the products, systems and manufacturing techniques which are the really big value-add components to the business. The recycling step now has its value with incremental improvement over volume.”

    Rassi said the company chose North Carolina for its second manufacturing location because it's central to both customers and raw materials, close to ports for import and export and because the state has a “business-friendly environment.”

    North Carolina state officials have agreed to reimburse the company $3.3 million over 12 years from taxes and other payments, based on expected tax revenue from the new jobs and investment.

    Rassi said the company wants to keep a focus on manufacturing, customers and employee relations.

    “Simply put, all of your processes and systems must be scalable,” he said. “You must deliver legitimate value to your customers. A genuine culture that present and future employees want to be part of and thrive in is mandatory.”

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