Eco-Products Corn-fed for Success
Eco-Products Inc. won the 2009 ACG Emerging Company Growth Award by emerging from its roots, then quickly rocketing toward the heights.
The company got its start as recently as 1990 yet already seems to have collected its share of historic highs. In 1990, Kent Savage, then chairman of the board of Boulder-based Eco-Cycle, went on a hike in Rocky Mountain National Park with his son Steve Savage, who had just graduated from the University of Kansas.
The recycling business consists of three phases, Kent Savage explained: collection, sale to manufacturers and wholesale distribution. The problem was there was no wholesale distribution. The solution was their co-founding of Eco-Products, which bought recycled-content products and distributed them mainly in the Denver-Boulder area. Kent Savage retired in 1999 and died in 2003, "so Eco-Products is a lot about fulfilling my dad's plan and his dream," Steve Savage says.
Another critical moment for Eco-Products arose in 2006 when then-CEO Steve Savage came to the company's board of directors with a daring proposal to change its business model around a new product called PLA, polylactic acid, a corn-based bio-plastic substitute.
Eco-Products had found success distributing PLA products for other manufacturers, "but we wanted to make these products," Savage says.
The board encouraged Savage, even though his notion meant turning 180 degrees, changing the company from what was then a successful retail distributor into a full-time wholesale manufacturer.
"We embarked on a 14-month journey to make cups, plates and bowls ourselves," Savage recalls.
The gamble paid off, and in two years Eco-Products' annual sales zoomed from $4 million or so to $50 million. What was not to love about PLA products? Savage asks.
"Not only was the price comparable to traditional plastics, but the quality was good. The fact that it was from a renewable resource and is also compostable really had a strong environmental message - and this new PLA technology really is a shining light to the food service industry, a $16 billion category that traditionally is not very green," he says.
Eco-Products today uses PLA and other green materials to earn honors as a versatile manufacturer of hot cups, cold cups, cutlery, clamshells, deli containers, soup containers, straws and so on, including BioBags, a line of compostable trash liners that biodegrade in as few as 45 days.
Last July, another big moment in Eco-Products history occurred when Steve Savage moved to executive chairman, stepping aside as CEO to make room for Bob King. Suffice it to say the last time King was named CEO of a $50 million company, that business was Boulder-based Corporate Express, which King helped build from a $50 million annual sales company into a $4.5 billion enterprise.
"Bob King has quite a history, doesn't he? And he's such a great guy," says Paul K. Edwards, partner in the consulting service area of Ehrhardt Keefe Steiner & Hottman, and one
of the four-person ACG-Denver awards panel.
"You don't always pick that up in the interview process," Edwards adds, referring to the rigorous quizzing of award nominees, "but I certainly did with him."
Eco-Products customers include the behemoths of food distribution such as Sysco Food Service, U.S. Foodservice and Aramark, plus hundreds of other independent distributors as well as large office supply dealers such as Staples. Other channels are opening to Eco-Products, too.
"Part of our strategy for 2010 is also to see if we can expand our presence in the office products channel, in paper and janitorial supplies," King says. "And to folks that are selling break-room supplies, because our products very much apply to break rooms, whether hot cups or straws or the lids for coffee cups."
Meantime, Eco-Products also is conducting a retail experiment with King Soopers, placing since July with 126 stores in Colorado a renewable, compostable cup and 9-inch plates made from sugar cane (the cane, not the sugar).
"This started out as a test; it's moving out of test (phase) now," King says. "We've had some pretty good success. Now we need to step back and analyze those results to decide do we expand the number of items - if King Soopers is willing, of course - and see if there are other parts of the Kroger Co. we can get our items into," not to mention other mass merchants around the country.