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Tom Szaky Writes Garbage

Tom Szaky's recently released "Revolution in a Bottle" is a five-star book that all environmentalists should read even if they don't think they're entrepreneurs, and all entrepreneurs should read even if they don't care about green, writes John Davies, vice president of the GreenBiz Intelligence division and leader of the GreenBiz Executive Network.

I have seen the future of trash and it's an immigrant who smokes weed, drops out of college, and collects used pop bottles to package poo. Apologies to Jon Landau, but there's a new boss in New Jersey.

My wife gave me Tom Szaky's just-released book "Revolution in a Bottle" last week for my birthday. I read it while traveling to Intertech Pira's Sustainability in Packaging conference in Orlando knowing that I'd meet Tom there. Let's get the rating right out of the way -- this is a five-star book that every environmentalist should read even if they don't think they're an entrepreneur and every entrepreneur should read even if they don't care about green.

The TerraCycle story is instructive in terms of how a blend of desperation and aspiration can foster innovation. Tom started the company by selling worm poop tea as a fertilizer. With very little money and orders to fulfill, he decided to use discarded plastic soda bottles for packaging. The product became a minor hit as he gained shelf space in big box retailers like Home Depot. That started Tom thinking more broadly about what we throw away and what he could make out of it. The company now develops products made out of source materials that are best described as branded waste. They make pencil pouches for OfficeMax out of Capri Sun juice bags and messenger bags out of thrown away Oreo wrappers.

As expected, I ran into some cynicism at the conference when I enthused about the guy selling garbage. But for me, the cynics miss the important business lessons in the book.

•  Tell a good story. Tom successfully appeals to our inner 8 year old to achieve selling success. He could tell customers he sells vermicompost tea, but it's a lot more fun to say worm poop.
•  Keep it simple no matter how complex your business. Tom has only a few rules for running his company. Underlying this is his understanding that consumers want a good quality product but will not pay a green premium. That provides the focus for all new product development opportunities.
Buyers want to be engaged. In his book and in person, Tom speaks with a human voice. When his representatives walk into Wal-Mart or Home Depot they're not reading from a script, they genuinely want to know the buyer's needs. It's easy to read from a script or a spec sheet, and talking with customers is really hard. But if you're trying to grow business and not just be an order taker, you have to take this approach. Tom proves buyers will throw out the 15-minute clock if they're engaged.
End customers want to be involved too. Perhaps one of the most ingenious aspects of TerraCycle's business model is the creation of their extended physical infrastructure. Schools and churches can sign up as brigades, groups who collect branded trash to send to Tom. The brigades make money for their favorite school or charity (two cents are donated for each item collected) and TerraCycle gets a steady source of branded raw materials. And it's clear that a kid who recycled juice bags is a great prospect to buy a juice bag pencil pouch.

As I mentioned, cynics at the conference questioned how successful you can grow a business based on garbage. But a majority of the executives I've talked with about Tom's business clearly understand how that misses the point. The business will grow as long as TerraCycle continues to listen to customers and adapt their model. Can they be the P&G of waste?

You can make up your mind after you hear Tom at our Greener by Design conference on May 20 (Bill McDonough is our keynote on May 19). I'll see you there.


John Davies is vice president of GreenBiz Intelligence, a unit of Greener World Media.


Image courtesy of TerraCycle Inc.

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