Fresh air: Arizona's southern desert provides a suitable business climate for Friedman Recycling Co.

Moving to Arizona was not a matter of economic opportunity for Abe Friedman. When the life-long Ohioan sold his recycling business, City Iron & Wastepaper, in 1975 and moved to Arizona, it was at the strong urging of doctors who said the desert air would offer a chance for a longer life with fewer respiratory problems for the asthmatic Friedman.

Although Abe considered other business opportunities in Arizona, he eventually returned to his recycling roots, founding Friedman Recycling Co. in Phoenix in 1977.

Abe, who passed away in 2000, supervised a growing paper recycling company that is now in the hands of his sons David and Morris, who serve as co-General Managers of a company with multi-faceted operations and a second location in Tucson, Ariz.

CAN-DO ATTITUDE. Although paper recycling is at the heart of Friedman Recycling's operations, the company has grown through its philosophy of widening its capabilities to meet customer needs.

"We're a value-added partner," says Morris. "That's how we got into metals, wood, security shredding, solid waste hauling and other business segments."

The company started its document destruction division (now called Security Data Destruction Co.) in 1986, when, notes David, "Our customers expressed an interest in that kind of service."

"We're always trying to meet the needs of our customers," comments Morris, who says Friedman Recycling began handling aluminum used beverage cans (UBCs) and other forms of metal for the same reason: "In response to customer requests."

Adds David, "Once we incorporate new materials or a new service into our structure for one customer, then we go ahead and integrate it into all areas of our business."

The duo emphasize that this philosophy does have its limits and that there are segments it explores but declines to enter, either because they are not a good fit or because it would be difficult to compete against existing operators. "Our integrity and reputation in the marketplace is at stake," notes Morris. "If we can't do something, we'll tell the customer."

Many times, though, the decision to try something new is given the green light. "If we're going to do it, we do it right," says David. "The bottom line is to ensure we can provide good service to our customers when we do."

The duo say this is a task that is by no means theirs alone, but that the company relies on all of its employees to maintain this philosophy. "We are very fortunate that we have a dedicated team that wants to please the customers," notes Morris.

Operating a business this way also involves opting not to compete on some levels, such as rock-bottom pricing. "We invest heavily in our people and our equipment--we're not the low-cost provider," says David. "The customers we retain recognize the value proposition."

BUILDING A BUSINESS.

Abe Friedman started his Phoenix-based company with a Harris HRB baler and some land he purchased in an industrial neighborhood on the city's west side.

The company has purchased additional land surrounding its original Phoenix parcel since then, and the 11-acre site now hosts corporate offices, an indoor secure shredding plant and significant outdoor sorting, baling and storage operations. Additionally, the company started a Tucson, Ariz., location in 1994, and that site has grown to mirror all of the same operational setups that can be found in Phoenix.

At the Phoenix location, recyclable material arrives over the scale and is taken to an outdoor processing area toward the center and the back of the property. Here, loads with mixed fiber make their way into a sorting system installed by Van Dyk Baler Corp., Stamford, Conn.

The system's disc screens and staffed sorting stations, when handling paper, serve to segregate old corrugated containers (OCC), old newspapers (ONP), and sorted office pack (SOP) from incoming streams of mixed office paper.

Ultimately, the sorted grades are conveyed onto an adjacent baling line, where a high-volume Bollegraaf baler makes the finished bales.

As a diverse stream of non-fiber materials (metals, aluminum cans, plastic bottles) make its way into the Friedman Recycling plant, it is introduced into the lines separately, to facilitate optimum sorting efficiencies and superior quality end products.

The sorting system can handle different materials at separate intervals. "We're all about flexibility," says Morris. "The plant is designed to maximize our operational flexibility," he notes, pointing to customized belts, disc-spacing adjustment settings and speed control mechanisms that allow the sorting lines to handle different materials.

The company's wheel loaders help move material into the staging area and onto the sorting line's infeed conveyors. Also zipping around the yard are forklifts to move, lift, stack and load bales.

According to Morris, who often heads south on Interstate 10 to help manage the Tucson plant, the setup at this location is very similar. There, a Centurion model baler made by Harris Waste Management Group Inc., Peachtree City, Ga., does the high-volume baling from within a 55,000-square-foot warehouse located in the center of the 5-1/2-acre plant.

The company takes its processing operations seriously. "The quality of our end product determines our reputation," says David. "We focus on recognizing and using the newest technology," he remarks, adding that the company is currently considering how best to deploy a variety of new technology.

Material is brought to both locations by a variety of customers, including waste and recyclable hauling firms and independent peddlers of collected material. Additionally, Friedman Recycling Co. has a fleet of more than 30 trucks that deliver and collect the 10,000 solid waste, recycling and document destruction containers the company has placed throughout southern Arizona. The company also has a rail spur for outbound shipping access.

The Phoenix and Tucson locations also include separate buildings where Security Data Destruction Co. processes the confidential materials it collects. The secure facilities are inaccessible to most visitors unless they are conducting an audited destruction of their own material. The Friedmans have recently achieved NAID AAA certification, the highest level of certification available in the industry, at their Phoenix facility. Certification for the Tucson facility is expected within the next quarter.

The outdoor operations are a luxury the company is able to enjoy in its desert location. Paper bales stored outside in the desert air seldom pick up additional moisture content, providing Friedman bales with a quality boost.

Although the outdoor operations are a benefit to the bottom line, they also carry a risk for Friedman Recycling Co., such as when a fire in 2003 caused the company to rebuild much of its Phoenix plant. (See sidebar, page 32.)

STAYING IN THE GAME. The fire of 2003 is the most noteworthy hurdle the Friedmans have faced, but business conditions can also be a challenge.

On the consuming side of the business, David and Morris point to the early 1990s as a particularly "trying time" for the company, as mill shutdowns in the western U.S. caused the company to figure out the most logical new shipping patterns. While the company still seeks regional consumers, its rail access allows it to ship to consuming destinations in Mexico, to the port of Long Beach and to mills located throughout the U.S.

On both sides of its business, during this decade and the prior one, national and global companies have become significant players in the paper recycling arena, providing a new level of competition with deeper pockets.

But David and Morris say there are many ways in which a large local company can stay viable in the recycling industry. "We focus on quality and we stay close to our customers, says David. "Whether it's performing difficult pickups or packing a special grade, our size and management structure allow us to achieve a higher level of customer service that the large national companies have a hard time reaching."

And while long-range planning and seeking out forecasts are critical, David says the company also acknowledges an opposing aspect to its management style. "We work very hard in some aspects at being reactive, not proactive," he comments. "Most business advisors will tell you not do to that."

David says a smaller, nimble company's ability to react can be one of its greatest advantages. "It's an equalizer," he remarks. "The larger companies often have a harder time reacting."

Morris agrees, saying the ability to react quickly and decisively "has allowed us to be successful." He adds, "We can be contacted right away by our customers and we are the ultimate decision-makers."

The need to make quick decisions can be stress-inducing for business owners, but Morris and David say they wouldn't have it any other way.

"There's nothing like owning your own business," says Morris. "It allows us to make choices to be a leader in our industry and in our marketplace."

RELATED ARTICLE: Friedman Recycling Co. at a glance.

PRINCIPALS: David Friedman and Morris Friedman. Co-General Managers: Their father Abe Friedman. who died in 2000, founded the business

LOCATIONS: Office and main processing plant in Phoenix: Additional recycling facility in Tucson. Ariz.: Certified shredding operations (Security Data Destruction Co.) in both Phoenix and Tucson

NUMBER OF EMPLOYEES: Approximately 100, including Friedman Recycling Co,, Security Data Destruction and Friedman Waste Control Systems business units

PROCESSING EQUIPMENT: Four high-density balers including an HBC 140 Bollegraaf baler and a Harris Centurion baler: five Bollegraaf sorting systems with a variety of Lubo screens; 30-truck fleet handling more than 10,000 containers and bins: Bollegraaf and Ameri-Shred document shredding systems: mobile material handling fleet includes wheel loaders, skid loaders and forklift trucks

SERVICES PROVIDED: Commercial recycling services; processing of residential recyclables; secure document destruction services; material brokerage; solid waste hauling services; equipment sales/rental/service.

RELATED ARTICLE: Trial by fire.

Friedman Recycling Co., Phoenix, is able to conduct much of its processing outdoors, which provides a benefit to the company's bottom line.

Outdoor operations keep overhead costs lower, as temperature control, lighting expenses and other costs associated with maintaining a large industrial building are minimized on the expense side of the ledger.

Unfortunately, however, if the dry, windy air brings just one spark onto the Friedman property, the damage can be considerable.

This worst-case scenario unfolded for the Friedmans in the early summer of 2003, when a "camp fire" started by a drifter on adjacent property spread to the scrub and brush along the Friedman facility, eventually engulfing much of the company's outside inventory and sorting and baling lines.

While facing the sizable task of rebuilding their physical plant, the Friedmans also had to consider how to offer ongoing service to customers without having the processing capacity to serve them.

Morris and David Friedman say they were heartened by--and remain grateful to--fellow recyclers and document destruction company owners who helped them during the plant's nearly nine-month period of inoperability.

They name Durango-McKinley Paper Co. as having been particularly helpful by accepting additional material and adding a second shift at its Phoenix plant. Additionally, Van Dyk Baler Corp. worked diligently to replace and install the new machinery as quickly as possible. "We really depended on our friends, and it was gratifying to see the response," says Morris.

The author is editor of Recycling Today and can be reached at [e-mail].