Cover Story – Trash to treasure

Posted on Oct 1, 2015 :: Cover Story
Sean P. Johnson
Posted by , Insight on Business Staff Writer
Photo courtesy: Shane Van Boxtel

Jim Feeney, president of Wisconsin Film & Bag, says perseverence, the willingness to take risks and handle failure are critical for the innovation journey. Photo courtesy: Shane Van Boxtel

Henry Ford once said that even a mistake may turn out to be the one thing necessary to a worthwhile achievement.

Jim Feeney heartily agrees. After all, Feeney and his team at Wisconsin Film & Bag lived the lesson first-hand. They built upon a mistake — one they could never replicate — to create ECO Blend, a post-consumer recycled plastic film product that has the same properties as virgin film.

The results of that happy accident? A product that spurred sales growth by more than 25 percent and enabled the company to grow its workforce by more than 50 percent. The process that resulted demonstrates the importance of nimbleness and creativity that smaller companies must employ to thrive  in a marketplace crowded with large competitors.

“Smaller companies have to take risks in order to compete,” says Feeney, president of Wisconsin Film & Bag. “The amount of capital that Fortune 500 companies have available for research and develop-ment many times stifles the creativity. We have to be creative.”

Production line at WFB_320

Crews work 24 hours, seven days a week producing plastic film products such as drum liner, pallet wrap and a variety of pouches. Courtesy: Sean P. Johnson

ECO Blend film resin may not come to mind as quickly as Viagra, Post-it Notes or the chocolate chip cookie — all profitable products developed from mistakes. But it’s a triple-bottom-line win for the Shawano-based plastics company: It’s profitable, the growing workforce benefits the community and the new product is good for the environment. On sustainability alone, the company has reduced the volume of plastic film going into landfills and the energy and pollutants associated with creating virgin materials.

In 2015, Wisconsin Film & Bag won an Insight Innovation award for ECO Blend and the process the company developed to recycle used plastic films.

“I get to be the good dad,” says Bob Kulesa, vice president of operations, who conducted the research resulting in the process behind ECO Blend. “It feels good to work at a company that not only makes a profit, but does it doing something right.”

The mistake

Courtesy: Shane Van Boxtel

Film scrap to recycle: Bundles of post-consumer film await cleaning and recycling in Wisconsin Film & Bag’s warehouse in Shawano. Courtesy Shane Van Boxtel

It all started with a supposed write-off.

As the company closed out 2008, it discovered a supply of post-consumer, recycled film material had been mistakenly purchased and was sitting in the company’s warehouse taking up space. The finance team suggested taking the loss and writing the material off at year’s end.

Now, the plastic film industry has always incorporated recycling into its operations. It’s common for pre-consumer materials — such as scrap cuttings or runs that failed to meet specifications — to be used as a raw material for new products.

Post-consumer films — pallet wrap or pouches used to protect furniture or other items during storage and shipping — have always posed a problem for the industry. Naturally tacky by nature, the films pick up dust and grime from everything they touch and are often covered by labels and adhesives from each step of the product’s journey.

While post-consumer films are recycled into new resins, they have always been considered low-grade and used for things such as drum liners. If you look at a sample of most post-consumer films, they lack the clarity of virgin resins and you can often spot specs of debris on the film.

This is where the fortuitous mistake occurs.

Since Wisconsin Film & Bag was going to write off post-consumer film in its warehouse, it was decided to run the material through the recycling process used for pre-consumer scrap to try and produce a higher quality resin.

“It worked,” Feeney says. “We thought ‘we can make a business out of this.’”

The Film Bubble_320

Molten resin pushed through an air ring which blows cool air onto the plastic creating this “bubble”. Courtesy: Sean P. Johnson

Buoyed by the first test, and the realization of its potential, the leadership team immediately began work on replicating the results and establishing a process that could be scaled up for high-volume production.

Those initial results were never duplicated.

What the team at Wisconsin Film & Bag would soon realize was the first test started with material that had been cleaned once. They were trying to replicate the results using material covered with dirt, labels and adhesives that did not clean easily. The material’s tacky characteristics and tendency to fold over itself also created challenges to get it clean enough to recycle.

All of which were factors that likely deterred previous efforts by companies in the industry to create high-quality resins using post-consumer films.

“Even now, had I not been part of it, I would not believe it if you told me you could make it work,” says Rich Carlstedt, a manufacturing engineer who helped the company put together the disparate machines and processes that make up the recycling line. “At first, I thought it would be an exercise in futility.”

Recognizing they would need to create an entirely new process with no guarantee it would work, Feeney and his team decided to continue their research. Passions were stirred and they were determined to succeed.

“We learned an important lesson that often, the first idea you have for innovation is wrong,” Feeney says. “We were committed.”

With his board of directors backing the effort, Feeney committed the team to starting over and methodically finding the successful path.

In many ways, the team working on the recycling project took what is best described as the Edison approach. The legend holds that in his quest to develop the lightbulb, Thomas Edison said of setbacks that he had not failed, but had eliminated what didn’t work.

“That’s a pretty accurate description,” Carlstedt says. “They went down a lot of alleys that failed.”

Scaling up

That meant starting simple. For Kulesa and his team, simple meant cutting strips of film and washing them by hand with different cleaning agents … in the breakroom sink. Persistence became the buzzword as the team experimented with different cleaners and damaged a few appliances in the breakroom in their quest.The first task was finding a way to clean the film so it could be run through the recycling process.

“We started off thinking this would be easy, maybe four steps,” Kulesa says. “It turns out paper is really hard to get off the film.”

One trial turned into what is now recalled as “Black Tuesday,” when the result was a black sludge rather than separated waste paper and plastic film ready for further processing.

Frustrated, but undaunted, the team kept at it and finally cracked the “secret sauce” for cleaning the film. It, too, is an environmentally friendly solution.

Each step forward seemed to present a new set of overwhelming obstacles. It’s one thing to successfully clean the film in the sink. It’s quite another to scale up the process to handle the tons of material that would make the process cost effective.

It did, however, lead to a unique story that Feeney loves to tell about the process.

Wondering if technology similar to commercial laundry equipment might be the ticket to processing large volumes of scrap, the team cut more than 8,000 pounds of film into strips and took it to area laundromats to test the theory.

“In Wisconsin, most people get kicked out of bars,” Feeney says. “We got kicked out of laundromats.”

They made sure to clean the machines before they left, he says.

But it worked. Now they just had to take what they had learned and scale it up further. Since no one had ever done it before, there was no existing equipment to install or even use as a model. The team at Wisconsin Film & Bag eventually found a manufacturer in Germany that designed equipment for recyclers of other types of plastics.

“They thought we were the crazy Americans,” Feeney says.  “They had not built a line this size for anyone.”

After all the trials, errors and false starts, Feeney and his team were not stopping now. Wisconsin Film & Bag invested more than $5.5 million to develop and construct its film wash and resin production line. (See a video of the final separation pool in action) Another $2.5 million was spent on new extruders and a building expansion to house the new line.

To date, nearly $9 million has been spent on the recycling center and the extrusion lines — all without disrupting the company’s core production lines.

Rapid results

The return on investment has been quick and resoundingly positive on a multitude of levels.

On the business side, ECO Blend products account for more than 25 percent of the company’s sales, a figure that continues to climb as the product opens doors and allows Wisconsin Film & Bag to compete both on price and environmental terms.

“It’s really opened a lot of doors for us,” says Greg Greene, vice president for major accounts. “Because there are a lot of competitors in the market, price is probably the number one deciding factor. We are able to discount the pricing for the recycled material yet still meet the specs buyers are looking for.”

A growing demand to meet recycled content targets also gives the sales team leverage to compete with major players in the market. Additionally, Wisconsin Film & Bag has become one of its own largest suppliers of raw materials, allowing it to further drive costs down.

“We never thought it would be this significant,” Feeney says. “It has been a wonderful business development tool.”

Overall, the company has grown 10 to 12 percent a year since ECO Blend came online, Feeney says.

The growing sales have had other financial benefits for the company. An economic development loan through the Department of Energy that helped finance the equipment and building expansion will be paid off in four years rather than the anticipated seven.

“We’ve just been blown away by the growth and job creation. Everything has happened faster than we anticipated,” says Al Johnson, the company’s CFO. “There are a lot of ways to measure payback, and we have good results from many of them.”

Environmentally, Wisconsin Film & Bag now has the capacity to recycle 7,000 tons of post-consumer film scrap, keeping it out of landfills around the region. Recycling that material reduces energy consumption by 395,500 mBtu compared to producing virgin resins from oil or natural gas, according to data from the National Resources Defense Council. The recycling process also reduces CO2 emissions by 2,422 tons.

Shari Jackson, director of film recycling with the Flexible Film Recovery Group of the American Chemisty Council, says the success of Wisconsin Film & Bag can serve as a model for other companies in the industry when it comes to recycling. The plastics have value that producers and users want to recover. Creating a process and a supply chain are important challenges to overcome to meet an industry goal of 2 billion pounds of film recycled annually by 2020.

“What they have created is a unique process for commercial recovery,” Jackson says. “Businesses want to recycle these films and are looking for recovery options like this. We need to be investing in opportunities like this.”

The workforce has also benefited, growing by more than 57 percent since the ECO Blend line was launched, from 109 to 175 employees working at the Shawano-based company. As ECO Blend further penetrates the marketplace, the company could see employment expand beyond 200 workers.

“I never get tired of hearing the story of how they persevered,” says Nancy Smith, executive director of the Shawano County Chamber of Commerce. “When I think of entrepreneurship, I can’t help but think of Jim Feeney and what they went through.”

In addition to its growth, Smith praised the company for the leadership and other contributions it makes to the community. Feeney has served as chamber president and is a regular contributor to its leadership programs.

Moving forward

Aside from the triple play on the bottom line, the recycling effort has created new business opportunities Wisconsin Film & Bag had not previously anticipated. The company is now working with trade groups, industry partners and other users of plastic films to create a supply chain for the post-consumer materials it needs to keep the recycling lines running.

“When I see trucks leaving Shawano with products I know are wrapped in film come back empty, I wonder how we can get that to come back full,” Johnson says.

While a walk through the storage area reveals stacked bundles of recycled film, there is room to handle additional material — even to bring on additional equipment if necessary. Plans for an additional extruder are in the works for 2016.

With three patents already approved for the recycling process and another two pending, licensing could also be in the future, though it seems unlikely the company will let go of the competitive advantage it has developed anytime soon.

Appreciative of the new opportunities, Feeney is also thankful for the lessons learned on what he calls the company’s “innovation journey.”

“Innovation is at the heart of what we do to survive,” he says. “Failure, and the persistence to overcome it, will lead you to success.”

ABOUT

Wisconsin Film & Bag (WFB) was founded in 1972 by John Rupple Sr. Operating out of a small plant in Oconto, WFB was a manufacturer of plastic trash bags. Since its beginning, WFB has experienced continued growth and accomplished numerous milestones.

» 1983 WFB moved to a new 20,000-square-foot plant in Shawano, increasing its capacity to 6.5 million pounds.

» 1993 WFB was purchased by two equity funds and Jack Riopelle joined the company as its new president. Seven new extrusion lines were added, expanding capacity to 45 million pounds.

» 1993-2005 Plant expansion projects increased the square footage from 20,000 to 60,000 square feet.

» 2007 Riopelle retired as president and Jim Feeney was appointed as his successor.

» 2008 WFB began research on recycling post-consumer films for high-end resin and films.

» 2013 WFB introduced ECO Blend, a family of resins produced from post-consumer scrap with properties that can match or exceed virgin resins while reducing costs.

» www.wifb.com

 

 THE RIGHT STUFF

Success often depends on having the right people at the right place at the right time.

For Wisconsin Film & Bag, it was having Jim Feeney in that sweet spot.

President of the company since 2008, Feeney oversaw the innovation effort that resulted in WFB’s patented process for recycling post-consumer scrap film into resins that can produce products with the same characteristics and specifications as virgin resins.

When things went wrong — and they did several times — Feeney was able to keep his team engaged in pushing the process forward.
Perhaps it was a sense of déjà vu. For nearly 20 years of his career, Feeney worked for some of the region’s major paper producers, and was involved in similar projects when that industry began incorporating post-consumer content in its products.

“We wound up working with some very similar processes that could be mapped into the plastics industry,” Feeney says. “There were some footsteps already there.”

A native of Philadelphia, Feeney went to work in Northeast Wisconsin’s paper industry after graduating from St. Norbert College. Those years spent with the paper companies, including companies listed in the Fortune 500, taught him some important lessons about success and innovation.

“The economic downturn of 2008 was the fifth one I’ve been through. It can be a good time to innovate because a lot of people and companies get stagnant,” he says.

Not only did WFB use that opportunity to launch its plastic films recycling effort, the company also opened new sales offices and worked to strengthen existing relationships as well as build new ones, Feeney says.

For Feeney, smaller and more nimble is better for innovation and competitiveness.

“That’s one of the reasons I left the Fortune 500 and came here. I want to be creative.”