EPRC: Recyclers Consider their Alliances

For paper recyclers working across longer distances, choosing lining up allies or partners can be a way to stretch a company’s capabilities.

An alliance or a partnership “can offer a much lower cost of entry than a merger or acquisition,” noted Bill Schlenger of Worldwide Fibers, Syosset, N.Y.

Speaking to attendees at a 2007 European Paper Recycling Conference session entitled “Allies and Partners,” Schlenger commented that both formal and informal arrangements can offer the benefit that “one and one can equal three.”

He advised those entering into more formal arrangements to have “a defined methodology to resolve disputes,” especially in the case of 50-50 partnerships. And in case disputes become too common, Schlenger also urged partners to have an exit strategy in place.

The key upfront, Schlenger also noted, is in selecting the right partner.

Simon Walker of International Recovered Paper Ltd. in the United Kingdom remarked that moving from an alliance to a partnership “implies closeness and it implies trust—things beyond an alliance. The modern way is partnership.”

Having partnerships internationally can mean overcoming cultural and language barriers, noted Walker, and having interpreters may not always solve the problem. “In some cases we don’t have interpreters, we have interrupters.”

Traditionally adversarial mills and suppliers can benefit by having a trusting relationship, said Walker. “We have to work together to improve the industry,” he commented.

Brian Taylor of Recycling Today remarked that with so many recyclers now being involved in lengthy supply chains or loops, having allies on the other side of the world has become critical. “Technology has done an amazing job supplying eyes and ears to fiber buyers and sellers, but technology alone cannot replace genuine eyes, ears, hands and feet,” he commented.

He also noted that small business owners in particular are torn between keeping a relationship flexible while also having a firm commitment in place. “At the opposite end of fearing entanglement is the desire for a contract to be in place—a signed agreement pledging each party to live up to certain expectations or to share the same profits and losses,” Taylor remarked.

The 2007 European Paper Recycling Conference, organized by the Recycling Today Media Group, was held in at the Hilton Amsterdam Oct. 3-5.