Industryweek 1351 19505 Tom Szaky Terracycle

Brand New Alchemy: Garbage into Gold

July 6, 2009
The key to success for TerraCycle is its supply chain.

Think sustainability and innovation have become overused buzz words? Get ready to rethink that, because a paradigm shift is taking place. Brilliant, sustainability-focused organizations are working together to create a self-sustaining closed-loop, and put an end to the resource-hungry monster of a linear system we have relied on since the industrial revolution. One young upstart has already made a tremendous difference, changing the perception of trash, raising money for charity, and making civilized life more environmentally responsible.

Just seven years ago, a college student named Tom Szaky started a company that turned waste, (which usually has negative value -- people pay to have it taken away) into a valuable raw material. The contents of TerraCycle's warehouse are similar to that of landfills, but organization is what sets the company's facility apart. By separating waste into its individual components, TerraCycle transforms it from discarded rubbish into valuable raw materials -- commodities.

Tom Szaky, co-founder and Chief Executive Officer of TerraCycle, Inc.

At the heart of TerraCycle's supply chain are our Upcycling Brigades. TerraCycle provides schools, churches, any non-profit organization with shipping materials and pays postage. Participants get paid to collect non-recyclable food packaging: cookie packages, chip bags and candy wrappers. This benefits schools, and TerraCycle ends up with a highly organized warehouse full of raw materials. The company also works with pre-consumer materials. For example any change in dye lot, graphics, promotions, a misprint or defect of any sort renders packaging useless. While manufacturers have historically landfilled or incinerated these materials, with increased emphasis on environmental responsibility, our partners are taking necessary steps to do the right thing with their waste. In 2008, pre-and post-consumer collections diverted over 80 million wrappers from the waste stream. The 2009 goal is to divert more than 3,000 tons of materials from the Mars company alone.

TerraCycle is a company conceived in 2001, during Tom Szaky's undergraduate studies at Princeton University. Szaky's innovation came through flipping the traditional waste removal business on its head. Specifically, rather than let the university continue to pay haulers to take dining hall waste to landfill, TerraCycle would remove it free of charge. TerraCycle composted these food scraps to create the highly lauded organic Worm Poop Fertilizer sold in major retailers and garden centers across North America.

Fertilizer was just the beginning -- by recognizing business opportunities where others only saw waste, TerraCycle has been able to upcycle many other materials (including eWaste, newspaper, plastic bottles, and other pre-and post-consumer packaging) creating a revolutionary new alternative to recycling and landfills. The opportunities truly are boundless. Now, halfway though 2009, TerraCycle has forged international partnerships where we reuse pre and post-consumer packaging from companies that have committed to sustainability in a big way, including Mars, Frito-Lay, Capri Sun, Nabisco, Clif Bar, Balance Bar, Kashi, Bear Naked Granola and Stonyfield Farm.

TerraCycle is ready to turn garbage into gold! It has developed ways to directly upcycle each waste stream we work with, turning single-use materials into goods and products that can be used repeatedly. Fertilizers made entirely from (and packaged in) waste, office supplies, home products, and even a new product line made from billboards, are being prouduced at TerraCycle. We're also developing proprietary processes for each of our partners' hybrid wrapper materials. These recycled products are currently or soon to be available in national retailers including Urban Outfitters, OfficeMax, Wal-Mart, Target, and Best Buy. What does TerraCycle's progress mean to others in the field? Product development is adapting as materials that can be upcycled become more diverse; as a result, manufacturing processes are greatly evolving. Long term, perhaps this means a shift toward locally focused economies where materials remain in a closed loop. The supply chain will be transformed from a linear process to a more cyclic operation. There is an almost limitless supply of resources to work with, which don't have to be harvested, cut down, mined, or synthesized.

Now could be the time for businesses to reconsider opportunities they wrote off in the past, or to evaluate the partnerships that might not be right for their competition -- perhaps it could afford your organization a competitive advantage, or simplify your work in ways that would greatly amplify your strengths. Through our programs, partners gain several advantages, including sustainable materials disposal and excellent PR. Whether you are looking at the current market from the eyes of a materials supplier, a manufacturer of brand name or private label goods, or the perspective of someone charged with the myriad details of compliance, it truly is time to tread carefully and to seek out new opportunities that may have been written off as impossible this time last year.

George Chevalier is a Sr. Publicist at TerraCycle, Inc.

Interested in information related to this topic? Subscribe to our weekly Value-chain eNewsletter.

Sponsored Recommendations

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!