From the first company to offer single-stream recycling in the mid-Atlantic region to becoming a leader in transitioning to alternative fuels, TFC Recycling is committed to improving its technologies used as well as helping other organization implement a natural gas program.
Started by the Benedetto family in 1973, TFC Recycling still operates as a family owned business today, now run by Michael Benedetto, President and CEO. Its primary location is in Chesapeake, VA where there are three different MRF operations onsite—the largest, Chesapeake Processing, is a single-stream, 40-ton-per-hour operation. The first company in the mid-Atlantic region to offer single-stream recycling in 1998, TFC Recycling has grown to be the largest one in the region and now has a single-stream, 20-ton-per-hour sister operation in Chester, VA. Between the two facilities, the company currently services about 600,000 households between Hampton Road and Richmond, as well as maintains about 4,000 commercial accounts. With 350 employees, the company runs approximately135 trucks, with 21 of them on CNG.
TFC Recycling’s buildings #1, #2 and #3 in Chesapeake, VA, house the overall onsite operations. Building #1 has the largest residential stream operation, while Building #3 is the newest complex and has the single-stream commercial waste operation. This material tends to be “dry waste” (low quantity of organic-type material like food waste), plastics, fiber, etc. Between #1 and #3, TFC Recycling processes about a quarter million tons per year. Building #2 is a small transfer and baling operation largely for hydrating materials that are fairly clean when they come in—most of it is fiber (cardboard and paper).
TFC Recycling services the entire south side of the Hampton Roads marketplace, with the exception of the city of Portsmouth. Cities include Chesapeake, Virginia Beach, Norfolk and Suffolk. They also service most of the north side peninsula, including Williamsburg and down through parts of the city of Hampton and Newport News.
A Stable Business Strategy
With a stable two-part business model (traditional collection company and recycling company), TFC Recycling is keeping its business at a steady growth. Says Paul Stacharczyk, Senior Vice President and Chief Operating Officer, “The business that we have from a collections standpoint is highly stable. Even though a good portion of it is municipal contracts, they tend to be multiple years. Likewise, with our commercial business, even though you do get some general routine turnover in your customers that is fairly stable as well. Revenue is growing organically at several percent a year, and the business is fixed and stable.”
He goes on to explain that on the recycling side of the business, the economy tends to have more of an influence on the business since the major source of revenue is from the sale of commodity materials—fibers, aluminum, metal, etc.—and is largely dependant on the market at any given time making it a true world market. “If the economy happens to be doing very well, then we do very well; if the economy happens to be challenging, then recycling will be challenging as well,” says Stacharczyk. However, since the Benedettos have been involved in recycling for a very long time, they have maintained extremely good relationships with all end users both domestic and foreign. Even beyond that, TFC Recycling tends to go a little extra mile to maintain those relationships. For instance, last year, a member of the company’s senior management team was sent to China to meet with the end users, port authorities and other entities to find out what specifically what they were looking for and what kind of problems they were facing. “We knew before we even shipped material to China what the expectation was and as a result of that we have had very few problems or material rejections,” points out Stacharczyk. “We do as much as we can to make sure that we are meeting the expectations of the end users.”
Developing a Sister Corporation
Five years ago the management at TFC Recycling took the time to sit down and revise their strategic plan to project a five to 10 year window and look at what needed to be done to improve operations and grow the business in a sustainable matter. The main goal was to create a rewards-based program to help promote recycling since it was the core business. “We had looked at some of the rewards-based programs that were in the marketplace and none of them encompassed our goal, so we decided to build our own. We developed a spin-off sister corporation called Recycling Perks, which is a geo-targeted based mechanism where technology is used at the truck level to identify recycling trends and participation,” describes Stacharczyk. “Once recycling data is captured, it’s used to develop marketing campaigns that are directed towards the areas where recycling is low. For instance, Recycling Perks executed a particular campaign in Chesapeake a few years ago where neighboring streets with low participation were identified. A contest was set up and participation was measured over a three-month period. At the end of it, Perks planned to hire an ice cream truck and send it down the street that had the most participation, to hand out free ice cream. However, both streets came within a fraction of a percent of each other so they sent the ice cream truck down each of them.” Stacharczyk goes on to point out that Recycling Perks looks at the final data and implements custom strategies to help grow recycling. “Rather than doing a massive campaign, Recycling Perks is working on the areas that need it. The rewards that developed are localized, so rather than giving resident’s dollars off a national brand product, in excess of 95% of the discounts are provided by truly local, small businesses. It drives traffic to those specific stores as well.”
Recycling Perks has had a very positive long-term effect. In order to determine the economic impact of the program, Recycling Perks contracted with two different universities (William Mary in Williamsburg and California State University, Long Beach) to do independent economic impact studies on Recycling Perks. In both cases, the data was very positive, showing that there was significant impact on the city above and beyond just recycling. “The program has expanded outside of TFC Recycling’s area and is being used in Florida and Georgia. It has certainly changed behavior. The initial results have been extremely positive,” says Stacharczyk. They have also received positive feedback from Augusta, GA where it has been implemented. The city has said, without a doubt, they have seen some significant increase in the recycling activity and they tie it back to the Recycling Perks program. “All of the cities where it has been implemented have seen a measureable increase in recycling. In every instance the only thing that changed was that we implemented our program.”
Transition to Alternative Fuels
The second part to TFC Recycling’s strategic development was the commitment to go to alternative fuels. “We saw ourselves as a green company and thought it would be important to ‘walk the talk’ and develop a plan to transition to using natural gas,” says Stacharczyk. As a result, the company bought its first CNG truck about two years ago as the beginning of implementing a natural gas program. Then, they completed building their CNG station at the end of 2012. It is the largest privately owned CNG station in Virginia and is capable of both fast fill and slow-timed fill. Says Hank Brown, Director of Fleet Operations, “When you are pumping natural gas, the faster you pump it, the more it expands. In an ideal situation, if you are located in a place where you can park your trucks overnight and fill it, you use a time-filled station. By filling it slowly overnight, you get more gas into the tanks. Fast fill is what you typically do when you fill up at a gas station. Our fast fill component will be ready this fall. However, the disadvantage to a fast fill is that the gas is expanding as you are pumping it so when it cools back down, you don’t have as much in your tank. It turns into a mileage issue: 275 miles per tank full vs. 240 miles per tank full.” Stacharczyk says although TFC Recycling’s fuel is currently only available to their partners, they do plan on selling fuel in the next couple of months as well and offering more of their customers a place and opportunity to fill up their CNG vehicles.
Other benefits of implementing CNG and owning the station include the savings on the cost of gas—CNG costs about $1.50 a gallon versus diesel, which is $3.75 a gallon. “The cost of operation has been a tremendous boom for us because it’s so much cheaper to operate. Not to mention that having one CNG truck on the road in place of a similar diesel collection truck is the equivalent of taking about 300 cars off the road—our carbon footprint is much lower,” says Stacharczyk. “This fuel is available; it is a true domestic fuel and with the incredible savings, it really makes your competition harder to compete with you once you implement natural gas into a diesel environment—plus, it’s the right thing to do.” He also points out that the trucks are a lot quieter and cleaner. “It even saves us on oil. Now, we get about 1,000 hours out of one truck instead of 250 hours; the motors are clean, it is soot-free and the guys like working on them because they are cleaner.”
Becoming a Leader
All of these steps have become an extremely successful part of TFC Recycling’s business model. They have become a recognized leader in their area with regards to natural gas since they were the first company in the mid-Atlantic region to embrace CNG trash trucks. They are also helping local communities develop CNG infrastructures. As part of the strategy to embrace CNG, Brown also developed a training program for the mechanics on both the maintenance of the CNG trucks and filling stations. The course is currently offered through Virginia Clean Cities in affiliation with James Madison University and more than 100 mechanics in other companies, cities and agencies have been a part of the program.
“We did the transition right,” says Stacharczyk. “When we first decided to go down this avenue to natural gas, before buying our first truck, we sent Hank to every class we could find throughout the North American continent to get all the training and certification he could and he really became an expert. He took a lot of time to learn what was necessary to have a well-run, functioning operation, so that when we went back to our vendors, we specifically told them what we were looking for in terms of compressor capacity, etc. As a result, our station was built exactly the way we needed it.”
In order to properly work on the trucks inside of our shop, TFC Recycling also had to retrofit their shop to comply with National Fire Prevention Association standards due to the methane that is in the truck. They installed a series of methane detectors on the ceilings and an evacuation system was tied to it. If the methane ever hits a certain level, the shop has a series of four explosion proof fans that are in the ceiling that will kick on. The garage door will open automatically, the heat is cut off—the building can be cleared out and evacuated pretty quickly. Brown also became certified in training so TFC Recycling could train all of their own mechanics in the proper handling of CNG trucks. They now have 17 certified mechanics and two federally certified tank inspectors. Stacharczyk explains that if a company is going to stand alone, you have to think along the lines of supporting yourself and your company. “To make something happen you can’t just have manufacturers send you trucks and hope that it’s going to work ok. These trucks require daily checks and maintenance, and we have to worry about its components. It is a culture change. CNG trucks drive differently and mechanics do a different type of work on the vehicles—it’s a high-pressure environment. It’s good to see something that’s been grown here; we don’t have to buy it from any outside sources. It’s the silver bullet for the next 75 years. We are very proud of what Hank has done with the shop.”
Another line of business that TFC Recycling is getting into is helping others convert diesel trucks to natural gas. “We’ve already entered into a partnership with Omnitek to become an installer of their technology on their large scale trucks. Now, we find ourselves becoming an outfitter,” laughs Stacharczyk.
These steps have given TFC Recycling a tremendous advantage. “As a result of doing all these things, local organizations come to us and ask us advice on how to do it properly. We’ve become the recognized leader on how to do a successful and safe implementation of a natural gas program.”
Outreach Programs
As a community leader, TFC Recycling participates in events and educational programs whenever they can. When there is a local parade, several of the cities around them request that their trucks be in the parade. In addition, the company has an educational classroom at their facility, so on a regular basis they host groups from local rotary club to the elks club to the PTA. “We also have kids come here to participate in the classroom setting. Depending on the age, we’ll give tours and we have a live feed from the operations into the classrooms so they can watch the process,” says Stacharczyk. There are also several people in the organization who meet with local groups and discuss recycling as well as give them training on what can and can’t be recycled, what is the appropriate way to handle things and other topics. “We integrated all of the company’s departments in order to share and develop programs together. We end up with a lot of outreach programs that involve different parts of the company,” explains Stacharczyk. “For example, with the Paint Your Heart Out program, we pick a neighborhood home that needs fixing up and over the weekend we’ll paint it, clean it, fix up the yard, etc. It is a team effort. Each manager here is attached to some type of charity organization. Each one of us tries to do something in the community. We meet and bring all of it back and the company supports it as well—this is part of our commitment.”
Implementing a Safety Culture
Because both Stacharczyk and General Manager, Dave Stabb came from larger companies in the industry, they brought a lot of the safety culture to TFC Recycling. The safety program is managed through the company’s HR department; however, Stabb ensures that the training occurs monthly at each of the divisions by the operations managers at each site. “What we find is that if the supervisors and managers are actively involved in the training process, the safety program is much more effective,” stresses Stacharczyk. “We actually belong to an insurance captive which is designed like a mutual, so we self-ensure each other. The particular captive that we belong to has safety-related training programs throughout the country quarterly and every time they hold one, we send a representative. In addition, Stabb is certified as a trainer and there are a variety of techniques that we will employ to ensure our safety program is good and viable. Our safety performance over the last several years has been outstanding.” Currently, the company is revamping their rewards program because Stacharczyk explains that at the end of the day, they not only want to encourage their employees to do things right, but they also want the employees to feel comfortable telling management when there are problems so they can be discussed.
Modernizing Existing Facilities
Over the next several years, TFC Recycling is looking at upgrading and improving the technologies they use for recycling, including some level of modernization in the existing facilities, adding solutions to capture more material, etc. “If you look at single-stream recycling and the technology that does come with it, it is a lot more efficient today than it was 10 years ago and it might be even more efficient 10 years from now, so the challenge is to keep up with that technology,” says Stacharczyk.
Recycling Perks has been successfully implemented in several municipalities in Florida and Georgia and the Recycling Perks team continues to explore opportunities to further expand the program outside of TFC’s Hampton Roads footprint. Finally, the CNG related component of the company will continue to expand. Says Stacharczyk, “We currently ship about 400 containers per month overseas through the Port of Virginia. Over the next couple of years, we are looking to convert all of that tractor trailer activity to natural gas and then expand that hauling opportunity for other users of the port.”
For more information, contact Kristi Rines, Marketing Coordinator at (757) 605-2262.