MUNICIPAL LANDFILL. Mattress Recycling. Facilitators: Pete Heuberger, Charlotte, NC Bill Lemke, Tacoma, WA John Gonas, Nashville, TN 4/16/2013

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1 Mattress Recycling Facilitators: Pete Heuberger, Charlotte, NC Bill Lemke, Tacoma, WA John Gonas, Nashville, TN MUNICIPAL LANDFILL County permit expires Costs Landfill charges $25/piece plus tipping fee plus hauling fee plus 30 c.y. rollout rental plus floor space in warehouse Investigate alternatives Junk $13.50? 1

2 MATTRESSGOROUND For-profit startup Social enterprise/job-creation partner $4 COD their dock Strip to springs, repair and cook Recycle all materials (except multi-fiber layer) Sells to universities; give one, get one. Price for non-profits Twin matt = $59, Twin box = $39, cheaper version available to spec Not affordable! Competitor pricing Twin matt = $30, Twin box = $20 (Corsicana) CAROLINA DRY HEAT Start-up company Hot-water extraction of surface stains Cook in oven degrees State of NC tag allows sale Plastic wrapped and sealed Pick up at donor site, process, and return to your warehouse 2 3 pickups weekly at donor sites Access to mattresses from other customers Cost: $17/piece Benefit = Dignity Build your own?? If you are Karen O Brien! 2

3 CUSTOMERS Recently homeless one bed per family member or couple, vetted by partner agency Sleeping on the floor one bed per family member or couple, for existing DSS clients. Volume = 0ver 5,000 mattresses distributed FY13 50% homeless, 50% sleeping on the floor. Increase of 50% in demand since mattress sanitizing program implemented NOTES We found out in fall 2012 that City of Charlotte will pick up and dispose of our mattresses free-of-charge. We found out that the County is responsible for collection and the City is responsible for disposal! No wonder the County dropped us from their permit. Wish they had mentioned/known that the City might work with us. Crazy! Split government = bummer. Silver lining = we now have sanitized mattresses and dignity for our customers. (And our Board has funded the program!) 3

4 FURNITURE BANKS RECYCLE NW FURNITURE BANK Universities, Hotels, the Public and Retailers Save donors the dump fee. $25 to take to dump NWFB collected and gave 3,000 sets of bedding 4

5 NW FURNITURE BANK Mattress retailer pays $6.25 piece to recycle Monthly NWFB gets 320 pieces, $2,000 month Pick thru 53 foot trailer Inspect and spray with Sterifab Clients sleep in a bed MATTRESS RECYCLING AND TEAR DOWN BACKGROUND 50,000 mattresses are discarded daily. 20,000,000 per year 23 cubic feet each Landfills hate beds! California is voting on legislation to make recycling mandatory SB 245 April 17 th. 5

6 MATTRESS RECYCLING IN THE NEWS Bedtimesmagazine.com March 2013 International Sleep Products Association ISPA Sleepproducts.org ISPA Earth recycling facilities About 40 total recyclers in the USA..and growing MATTRESS RECYCLING AND TEAR DOWN Beds are collected. FOR a FEE Sort good from bad. 25% to 30% can be used for clients Tear down bad ones and sell the scrap Steel 31 $0.085 One unit equals $5 in scrap Foam 8 $0.200 Felt 2 $0.015 Cotton 5 $0.015 Outer cover 14 $0.065 Plastic 1 $

7 LABOR INTENSIVE: ONE MAN CAN DO 40/DAY REVENUE STREAM Mattress Recycle Feasibility Worksheet Revenue/pc Pcs/Month $ $5,938 Retailer $ $880 Drop offs $ $3,600 Landfill $ $2,000 Pick up Total 1530 $12,418 Avg per piece $7.39 plus $5 [$7,650] Total $20,068 7

8 EXPENSES Start up costs 4-5 Balers $11,000 new Box scraper $20,000 Forklift $8,000 Misc Tables, tools, etc Total $80,000 to $100,000 Foreman Man 1 Salary $3,500 Tear down Man 2 $11/hr $2,000 Scraper/Baler $11/hr $2,000 Shop Supplies $175 Utilities $600 Garbage $200 Transportation $325/trailer $2,925 Fuel $0 Insurance $200 Property Taxes $700 Phone/Web $150 Rent.34/ft $3,750 $16,200 DR JOHN S. GONAS ASSOCIATE PROFESSOR OF FINANCE BELMONT UNIVERSITY 8

9 SPRING BACK'S BRIEF HISTORY Spring 2011 Belmont University students develop business plan and retail marketing materials Concept is piloted Summer 2011 Partnership with local church s ministry serving formerly incarcerated men & Davidson County Sheriff s Office Mission: Support sustainable employment & small business training for formerly incarcerated men, and lowering our recidivism rates Keep mattresses from area landfills recycling hundreds of thousands of pounds of metal, wood, foam, and cotton Offer BU students an opportunity to build a social enterprise from scratch. February 2012: Moved ministry into 8,000 square foot facility, purchased capital equipment, secured retail partnerships enabling inventory of 500 mattresses/week, and modeled cash flows, operations, and safety procedures. SPRING BACK'S HISTORY (CONTD) As of March 30, 2013: Mattresses received from retailers in 5 states, waste management companies, Metro Nashville Public Works, local institutions, and local citizens. 5 men have full time employment 27,200 mattresses disassembled to-date More than 1.5 million pounds of metal, foam, cotton, wool, and wood) have been derailed from area landfills and reconstituted into carpet padding, paper, mulch, and scrap metal. Spring Back Recycling granted 501(c)3 status to license the model in other U.S. cities 200+ Operations Manual to offer best productions practices, marketing, and sourcing options Spring Back Colorado licensed in August & has processed over 4000 mattresses 9

10 SPRING BACK TODAY Two primary revenue sources: Retail and institutional sourcing ($4-$10/unit) Baled scrap sales Metal (.09/pound) Foam (.17/pound) Outer layer (.06/pound) Shoddy (.02/pound) Wood (.00/pound) Key drivers to profitability: Consistent sourcing (267+ mattresses/week for 4 men + fixed costs) Operational efficiency (70-85 mattresses per man each day) Established scrap pick-up of bales flowing bi-weekly MEDIA & PHOTOS NPR National Morning Edition WKRN News 2 and News Channel 5 (Nashville) NPT Tennessee 10