From Portland to Stanford, greening sports stadiums one bag at a time
Recycling and composting at stadiums and arenas is becoming more commonplace. This has encouraged a cadre of innovative, green companies already servicing the broader economy to make sports a new beachhead.
Natur-Tec, a leader in the development of compostable, bio-based polymers, is one such company. GreenSportsBlog spoke with Rick Lombardo, Natur-Tec’s director of business development, about the company and its work at the intersection of Green and Sports.
Lew Blaustein: There seems to be significant competition in the compostable market these days, with the sports world taking particular interest in compostable utensils and cups. Is that the market Natur-Tec plays in?
Rick Lombardo: Yes, that’s about right. We are focused on the development of compostable and bio-based polymers.
Blaustein: What does that mean, practically?
Lombardo: OK, sure. For example, NatureWorks makes Ingeo (PDF) polylactic acid used to make cutlery that’s heat resistant up to 140 degrees Fahrenheit. We chemically modify Ingeo to improve its heat resistance properties and make it suitable for food service applications, such as cutlery. So in many cases, we work with the BASFs and NatureWorks of the world.
Blaustein: What about Eco-Products, a company we featured in an earlier GreenSportsBlog post, that makes compostable plastic cups that are increasingly used at stadia and arenas?
Lombardo: We supply Eco-Products with compostable can liners, which is our biggest product line. However,we compete with them at times on cutlery.
Blaustein: So Natur-Tec is, in essence, frenemies with companies such as Eco-Products?
Lombardo: Yes, but we consider Eco-Products to be a very good friend. They are a terrific company and partner.
Blaustein: Very interesting business, it seems. How did this all get started?
Lombardo: Great question. Natur-Tec is a division of Minnesota-based Northern Technology International Corporation (NTIC), a 40-year-old company whose core product is Zerust, a material/rust preservation product. While Zerust focuses on material preservation and corrosion prevention, NTIC is focused on environmentally friendly products and solutions.
It spawned Natur-Tec 10 years ago. We launched by selling Natur-Bag — our compostable liner product — and it’s taken off since.
Blaustein: How did you get involved?
Lombardo: I was always interested in the environment and packaging. I graduated from Michigan State with a packaging degree. I started at NTIC on Zerust about 10 years ago and moved over to Natur-Tec 7.5 years ago.
Blaustein: How’s Natur-Tec doing?
Lombardo: Business is great. Fiscal year 2015 sales are tracking 27 percent greater than 2014.
Blaustein: What’s driving the growth?
Lombardo: Well, the market is growing — in part because of state legislative measures that mandate more recycling, more composting.
Thus there’s a growing compost infrastructure, which drives the possibility of greater distribution of Natur-Bag Compostable Liners, which leads to the higher sales goals.
Lombardo: Yes. Using compostable trash can liners helps keep organic scrap collection bins clean and dry. As a result, there’s significantly less washing of bins required. With at least 22 states suffering from drought, this is a meaningful benefit.
Blaustein: Will the growth, both category-wise and Natur-Tec-wise, persist?
Lombardo: We believe so. Hard as it is to believe, only 2.5 percent of the U.S. has access to compost facilities that accept post-consumer food scraps.
Assuming we get the increased processing facilities and stronger local laws, this number will most certainly go up. And we’re running out of landfill space, so that’s another pressure point.
Blaustein: Where does sports fit into the Natur-Tec customer lineup?
Lombardo: Our liners are used at Portland’s Moda Center (home of the Trail Blazers), Stanford University, University of Colorado and the University of Maryland. We’re actively engaged with other sports venues as well.
GSB: What percentage of sales does sports represent?
Lombardo: It’s small now, less than 5 percent, but we’ve doubled sales in sports over the last year. We see sports as a way to increase sales and to build awareness of our categories.
GSB: How do you build that awareness?
Lombardo: It’s really an education process with sports venues, among both employees and fans. Employee and fan engagement are crucial to the success of these programs. Staff training sessions and stadium signage are very important.
GSB: What, if anything, is holding Natur-Tec back in sports?
Lombardo: One issue is that the sale is often a two-step process. First, we have to talk with the venue and then, if we get their blessing, we go to the concessionaire, who would end up being the customer.
And I should note that compostable liners are much more expensive than liners made from traditional plastic. …
GSB: How much more expensive?
Lombardo: About four to five time as much.
Blaustein: Wow, that’s a huge multiple.
Lombardo: Some of that is negated by labor cost savings associated with reduced collection fees and less cleaning (less sorting, less water, less labor). Compostable cutlery is between two and three times as expensive, but it’s a key component to zero-waste and it’s challenging to recycle post-consumer, food-soiled cutlery.
On the other hand, many other compostable food service wares are almost at parity with conventional offerings. And, since customers want a complete, one-stop-shop solution, the price difference when one considers all products is not as severe.
Blaustein: So, if you crystal-ball things for us, where do you see the compostable plastics business going, both inside and outside of the sports vertical?
Lombardo: I see sports as a multiplier for awareness for the compostables market — and for other green product categories.
Beyond sports, I think the macro trends are in our favor: More composting overall; a legislative environment that will increasingly demand it; and increasing consumer demand.