Cooperative Marketing Engines Run Full Steam Ahead

Cooperative marketing engines run full steam ahead by Mary Kohrell and Lola Schoenrich C ooperative marketing offers economies of scale, shares information and improves the stability of re&ycling markets. Cooperative marketing generally refers to tbe efforts of a group of recyclers voluntarily working together to sell their recyclable materiials It has been a forte to be reckoned with by recyclers and buyers alike since the birth of the first cooperative marketing program in New Hampshire in the early 1980s. The only problem was, except for a few strong mainstta programs, the forte of cooperative markettin to be reckoned with was the hot air of discussion, not real steam generated by operaatin programs. But times have changed. According to the results of a recent survey of cooperative markettin groups in the United States and Canadda cooperative marketing has arrived in the mainstream of recycling market development. Today, these programs focus on enhancing the supply of and demand for recyclables. Like the fabled little engine that could, which started in the valley and successfully puffed its way over the mountain pulling a load much bigger than anyone thought possibble more and more cooperative marketing groups are gathering speed and steam, and triumphantly telling naysayers, “We knew we could, we knew we could!” Al1 across the country, the valleys of underssuppl and the mountains of oversupply are being leveled, at least in part because of cooperative marketing. Indeed, cooperative m Resource Recycling March 1995 marketing has become a proven market develoopmen tool of the 1990s. Survey provides data Aware of the growth in the number of cooperaativ marketing programs, in 1993 the Cooperrativ Marketing Network (see sidebar), under the direction of its steering committee, undertook a survey of cooperative marketing programs in the United States and Carrada. ‘We were all getting calls from folks wantiin to start cooperative marketing programs,” said steering committee member Gary Olson. “We knew there had to be a better way to conneec people and share our collective knowleddg about cooperative marketing. So we deciide to conduct a survey and share the resuult so everyone could learn from al1 of our efforts.” The survey, funded through a grant from Region II of the U.S. Environmental Protectiio Agency, was comprehensive, covering background information, services, operations, finances and most other aspects of cooperathha cooperative marketing programs are d signed to function in a very individualist manner; there is no “model” program th works in al1 settings. There are, however, similaritie programs. By and large, the surve show that cooperative marketing p offer services to recycling pro and nonmetropolitan areas. ing number of programs -provide service to public-sec though me private sector partrc~ ing materials in over half of the The private sector is also active in terials from al1 cooperative mar In terms of the benefits gained thr operative marketing, there is sensus. As shown in Figure 1, the programs agree that coop ing improves the economies cling, as compared to individu Mary Kohrell is recycling markets specialist for the University of Wisconsin -Extension’s Hazardous Waste Education Center at the University of Wisconsin -Green Bay. Lola Sch community development specialist with The Minnesota Project (St. Paul. ‘Minnesota), a nOnP ter for rural community development and public policy. /‘Gain access to long-term, reliable markets by consolidating smaller amounts of recyclables into larger volumes. d Help new recycling programs by providing technical assistance, access to markets, and collection and processing services. d Improve economies of scale by increasing amounts of recyclables processed and shipped. ti Increase market prices for recyclable materials and a&act new regional end users. cent) and improved market stability (60 perceent are benefits. As indicated in Figure 1, these three benefits exceeded the expectations held when programs were being started. 0 10 20 30 40 50 Number of respondents 1) Percentages based on 55 planned and operating programs. sources: Mary Kohrell and Lola Schoemich. 1994. The differences among programs become six states and two provinces in north central clear when we look at size, services and op-North America. One of the smallest programs, erations. Cooperative marketing programs the Lake Region Recycling program. serves come in al1 sizes. On the large end. the Mid-8,000 people in a six-county area in east cen-Continent Recycling Association represents tral Kansas. The survey results show that Benefíts of cooperative marketing compared to reasons for startin cooperative marketing programs (1). Why started Improve market stability Increased volume = higher prices Increased quality = higher prices Move unmarketable materials Help new recycling programs start Improve economies of scale Share information Other most programs -83 percent -serve sui state regions defined by counties or munic palities. Al1 cooperative marketing programs off< marketing services, and certainly this was & foundation of the first programs. Now, howevver the programs represented in the survey offer an array of services that go well beyond the traditional marketing service. These incllud joint collection, processing and markkng, which is planned or offered by 38 perceen of responden& joint processing and marketting planned or offered by 5 1 percent; consoliddatio of materials and marketing planned or provided by 7 percent; and marketing servicce only, provided by 18 percent of the prograams Market development matters In addition to collection, processing and markettin services commonly offered by cooperaativ marketing programs, the programs are increasingly providing a range of other servicces As Figure 2 shows, over 80 percent of survey respondents report working on markke development, with half of the programs also focusing on buy recycled programs, anotthe aspect of market development. “1 think most of us involved in cooperatiiv marketing think of what we do as markke development in some way,” says Jennifer Heaton, executive director of the Westem Wisconsin Recycling Association, Eau Claire. “Exactly what we do and how we do it, whether we focus on supply issues. demand issues or a combination of bòth, depends on what is needed in our local programs.” Beyond marketing: Additional services provided by cooperative marketing groups 1 * ] Planned Market Public Training Equipment BUY Other development education purchase recycled Note: Percentages add to more than 100% because responden& chose al1 that applied. Percentage based on 55 responses. Sources: Mary Kohrell and Lola Schoemich, 1994. Heaton continues, “Now, especially, when demand is extremely strong for certain materrial like plastics, cooperative marketing’s ability to generate consistent supplies of qualiit materials is more critical than ever.” Take the Southwest Public Recycling Associiatio as an example. SPRA represents recycling programs within a six-state area in the southwestem U.S. According to executiiv director Gary Olson, SPRA has fostered increased supplies of recyclables from rural areas with relatively low population densities through its cooperative marketing programs. Its ability to enhance local supplies, combined j, Nationwide Sales and Service Distributor NetworkA,LLER &N”FA~T”RINC ““““fs with SPRA’s technical support of recyclingbaase manufacturing to improve the region’s economy, has gamered additional market demaan for severa1 recyclables, most notably glass and corrugated containers. SPRA also conducts buy recycled training workshops, holds an annual market development conferennc and fosters closed loop recycled produuc purchasing programs with its buyers whenever possible. “Historically, 1 think most cooperative markettin programs focused on enhancing suppllie of recyclables as their primary market development work and. of course, those effoort are still important,” says Olson. “But when you look at what groups like SPRA are doing on the demand side of market developmment you begin to realize how much potenntia there is for cooperative marketing prograams even if they aren’t as big as SPRA.” Experience seems to show that smaller cooperrativ marketing groups can make an impaac on local markets. In Minnesota, for exampple the Southeast Minnesota Recyclers’ Exchange in Rochester held a regional conferrenc for recyclers, economic developers and manufacturers to convey the potential economic development opportunities availabbl through recycling. ‘The conference succeeede at connecting some entrepreneurs to the resources they needed to pursue their ideas,” states coordinator Susan Waughtal. “We are now assisting severa1 manufacturers working to incorporate post-consumer recyclaable as a feedstock. We also formed ongooin ties with members of the economic develoopmen community, who are now aware of recycling issues and possibilities.” SEMREX has also been working for the past year on developing a local market for glass. “We are creating a product that can use al1 three colors of glass containers, as well as mixed broken cullet and other noncontainer glass. Once in ful1 production, we anticipate using a major portion of the colored glass generaate in the SEMREX region. Everyone who has seen our product has responded enthusiasttically. said Waughtal. An announccemen describing the project will be made very soon. If successful, the SEMREX project would be a win-win situation. SEMREX has been working with Winona Occupational Rehabilittatio Center Industries to produce the glass product, which will hopefully create long-term. sustainable jobs for WORC’s employyees people with disabilities. Although WORC will undertake the venture, SEMREX is working in partnership to see the project through. SEMREX wrote the grant proposaa to fund the project, will supply the glass and will assist with technical research and marketing of the product. Across the Mississippi River to the east, the Westem Wisconsin Recycling Associa-tion, a cooperative marketing organization invollvin 19 counties based in Eau Claire, is also involved in market development. Like SEMREX, the westem Wisconsin group hs been working to bring economic developmet and recycling professionals together. In late 1994, the group held a successft statewide workshop on the potential economi development opportunities available throug recycling market development, and plans t continue fostering partnership growth be tween these two groups. It is also conduc, ing a study to determine the feasibility of cn ating a localized market for polystyrene. “1 our polystyrene project is successful.” relate director Heaton, “it would help us become f nancially self-sufficient for the future.” Looking at the horizon To imply that cooperative marketing progran are a panacea for market development and n cycling is not justified. Although the lime er gine that could has climbed the mountain. th ride ahead is not necessarily al1 downhil Even though cooperative marketinp group are surviving -some even thriving -a they conduct their recycling and market de velopment work, the going can be rough. Cooperative marketing groups that re sponded to the survey report two major chal lenges. First, the lack of resources. both hu @he Cooperative Marketing Network is a pup of people working to link the many U.S. and Canadian programs that are cooperaativel marketing recyclable materialls Cooperative marketing is seen as one ;of the solutions to the problems that local ‘recycling programs have marketing their ‘&yclable materials, and the number of cooperrativ marketing programs is growing ‘rapidly. 1’ The network was formed at the 1992 Nationd Recycling Congress (the annual conference of the National Recycling Coalition) in Boston. Wrth many programs forming in relative isolation, the network attempts to learn from one another by providdin a forum for sharing information, building on program successes, learning from mistakes and helping local programs answer some of the questions about cooperaativ marketing. man and financial, was reporte’d by 73 perceen of programs. Many programs (7 1 perceent also ran into diffrculties with local polittic -problems with the dynamics of humma relationships, different levels of govemmeents private recyclers, elected offrcials and community groups; in short. relationships between any and al1 participants and potentiia participants. Most existing and new cooperrativ marketing programs will survive these challenges. A few may not. So what resources exist for cooperative markettin programs, or those interested in exploorin the concept? The Cooperative Markettin Network and its members offer severaa sources. For those interested in a “who’s who” of cooperative marketing in North Americca copies of the Res& of the 1993 Surve~ of Cooperative Marketing Groups in the Usted States and Canada: Peer Match Directo-and Individual Program Summaries and the compannio volume, Analysis of the Results. are available for a minimal charge from The Minnessot Project. Detailed case studies of seven rural cooperative marketing programs are also available from The Minnesota Project. A ‘how to” manual on developing cooperative markettin programs, Cooperative Marketing of Recyclables: A Planning and Implementarion Guide, written for Wisconsin but relevant for others, is available from the Associated Recycller of Wisconsin. Furthermore. a newsletter, Cooperarive Connecrions, is produced quarterly by the Nebraask State Recycling Association under the direction of the Cooperative Marketing Netivoork The newsletter. funded through a combiine grant from a majority of the regional EPA offices, is available on request from NSRA. As a part of the same EPA-funded project, the Cooperative Marketing Network offers workshops around the U.S. to assist groups in getting started and moving ahead. Proposed upcoming workshops will be held this summer in the Midwest, and in Septembbe in conjunction with the National Recycllin Coalition’s annual conference in Kansas City. Finally, the Cooperative Marketing Netwoor is planning to organize and coordinate a peer match program, again with funding from several EPA regional offtces. that would match up “experts” in cooperative marketing with their peers who need program assistance. To order copies of the complete survey results, contact The Minnesota Project at 1885 Universitt Avenue West. Suite 3 15, St. Paul, MN 55 104: (612) 645-6159. To order the cooperative marketing planning and implementation guide. contact the Associated Recyclers of Wisconsin at P.O. Box 671, Madisoon WI 53701: (608) 355-2769. To request a subscription to Cooperufive Connecttions or for additional information on workshhop and the Peer match pro_mam. contacthe Nebraask State Recycling Assoaation at 1941 S. 42nd St., Suite 512, Omaha. NE 68105: (402) 444-4188. A COMPOSTER TOO GOOD TO REFUSE Backyard composting programs wiZZ work -in cities that offer the Biostacp Composter. The unique three-tiared design of the Biostack@makes light of the hardest part of the composting job -tuming the pile. Because it makes composting so easy, the Biostack@ensures a succeasful municipal composting program. Artd it’s fabricated of 60% recycled polyêthylene. 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