Reduce, reuse, rebox: Rebox Corp. makes reusing corrugated containers its priority.
When I first got into the industry, I believed that our business model created a win-win situation for our suppliers and customers. This belief still holds true today. We offer companies a significantly higher value then published prices for the secondary market, as we are interested in reusing, not recycling, this product. The customers that we sell to can save in excess of 30 percent on the cost of their packaging, and this is money that can go right back to their bottom lines.
Rebox Corp. procures more than 30 million boxes annually. We do this through supplier relationships with various Fortune 500 companies and we have set up recycling programs with many manufacturing facilities across the country. We believe our service provides them with the highest rate of return for their scrap, as well as the most environmentally proper use of these materials.
THE MODEL. The collection and pickup of reusable scrap boxes is a seamless process that is easy to set up at any facility and only requires three steps:
1. Cartons must be knocked down;
2. Boxes should be palletized;
3. The loads should be secured to the pallets using strapping.
Our service also ensures that when we are informed that a load is ready for pickup, we are there within 48 hours, as we are aware of the space constraints at most plants.
I can also provide a financial model that demonstrates the potential benefits of selling scrap boxes for reuse versus recycling:
* Client One generates one trailer per week of corrugated containers, with approximately 13 tons per load. Rebox pays $120 per ton versus recycling, which used to yield $60 per ton for the customer. Annually, the customer realizes a financial gain of $40,560 by selling its boxes for reuse versus recycling.
* Client Two generates 20 loads per month of corrugated containers. When selling to the recycling market, the client was getting paid $400 per load, but Rebox pays $700 per load. This is a financial gain of $72,000 for the company's scrap corrugated containers.
Rising fuel and raw materials costs have also served erode margins. These factors have forced companies to look for alternative ways to cut costs and to add profit to the bottom line. We believe that working with Rebox Corp. is one of the few options that can actually help companies achieve these goals.
ESCALATING COSTS. New corrugated box prices have gone up 20 percent during the last year. This increase has helped Rebox to convert greater numbers of businesses from buying new cartons to buying used cartons.
Our boxes are suitable for repacking, shipping and distribution, at a fraction of the cost. Our strategically placed logistics centers are stocked with inventory, ready to ship product to our customers, whereas lead times for new boxes can be from seven to 10 business days.
We work with major retail chains at the distribution level. Shipping product from a distribution center to stores is an internal transfer that doesn't require new corrugated boxes. Our reusable boxes can maintain the integrity of a product as it goes from point A (the distribution center) to point B (the retail location). Shipping merchandise in our boxes has saved our customers hundreds of thousands of dollars.
For example, Customer A buys four trailer loads of corrugated containers per month, with each load containing 8,400 units. The customer previously paid 80 cents per new container, while Rebox charges 60 cents each for our boxes, resulting in $6,720 per month in savings. This adds up to nearly $80,640 in savings for the whole year.
The cost per unit varies depending on the size and strength of the box, and the amount we offer to suppliers differs based on the same variables; however, one fact remains constant: Any company that deals with Rebox either saves money with regard to its purchasing or earns more when selling its used corrugated containers to us.
THE END OF THE LINE. Rebox Corp. also works with a number of recyclers across the country. When we generate large tonnages of corrugated containers that cannot be sold to our customers for reuse, they must go to secondary markets for recycling. We sell these containers to recyclers or directly to mills for reprocessing.
In other cases, customers require one vendor to handle all of their recyclables. Rebox manages these materials and contracts out items like wood pallets, drums and paper to recyclers.
Not to be lost in this equation are the environmental benefits that come from our model. Each ton of reusable corrugated cartons saves 17 trees. Last year alone, with the help of our suppliers, Rebox Corp. saved more than 500,000 trees.
Rebox Corp. is made up of a team of entrepreneurial thinkers who subscribe to the business model: "Give the customers what they want, and they will keep coming back." Throughout the last 15 years, we have provided our suppliers and customers with prices and service that ensure that we maintain their business.
We welcome inquires from companies looking to increase the rate of return on their corrugated containers or to save money on packaging. We hope that paper recyclers will consider the possibility that when it comes to reusing versus recycling there are potentially profitable opportunities to enter the reuse market.
The author is vice president of Rebox Corp. and can be reached at firstname.lastname@example.org.
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|Title Annotation:||COMPANY PROFILE|
|Date:||Feb 1, 2007|
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