Life Among the Eco-Capitalists: A Revolution Takes Hold in New Jersey

By Sander Hicks, AlterNet. Posted May 6, 2009.

"I may put the cart before the horse, but we always pull it off."  

Control-freak venture capital "brokers" constantly get in the way. One of them started a copycat worm-poop fertilizer business after Szaky walked away from a deal. The TerraCycle idea is good. Copycats are understandable. But those brokers didn't get it: the TerraCycle secret is not just that organic plant food in reused bottles makes an interesting product. TerraCycle's world-changing "open secret" is that we should use our society's voluminous multiple waste streams to produce fun, green products. Cheaply.

TerraCycle should give birth to a whole new industry. Szaky tells Alternet that he's surprised there aren't yet more serious competitors doing what they do. 

According to Szaky, most people want to support a recycled or green product. But only 5 percent of consumers are willing to pay a nickel more for one. We Americans love doing good, but we really love money. Instead of challenging that, Szaky has found a work-around. His "upcycling" eliminates a big part of the "costs of goods sold."

TerraCycle proves it's cheaper to clean used bottles than use new or recycled plastic bottles. So, TerraCycle plant food is not only organic and beating Miracle Gro in a battery of tests, the retail price is lower. On-the-street guerrilla market research of the "billboard bags" showed that folks were willing to pay $25-$35 for the hip, urbane pouches. What are the margins on a product that retails for $35 with no material costs? OfficeMax just ordered 10,000. 

In the book, we hear from Szaky's baby-boomer counterpart, Jeffrey Hollender at Seventh Generation, the recycled-paper products company.

Next to Szaky, Hollender sounds old. Hollender sniffs that his consumers are more than willing to pay more for recycled goods, and so he charges more. Hollender refuses to sell to Wal-Mart. But Szaky loves getting into all the big-box stores, and keeps his prices low.

TerraCycle makes the green revolution less expensive. Mainstream America learns to rethink waste just by picking up and checking out a TerraCycle billboard bag, kite or bottle of fertilizer. So, instead of just selling to the more well-off crowd at Whole Foods -- people, presumably, like Hollender -- Szaky sells to Wal-Mart consumers, and does it with gusto.  

In the book, he doesn't comment on Wal-Mart's unfair labor practices, of course, but big-box retail shows the mass scale to which TerraCycle aspires.

"Preaching to the choir is easy," explains Albe Zakes, the young company vice president, in his office in Trenton, N.J. "Reaching the Home Depot customer is hard. Just because you make $30K a year doesn't mean that you can't shop green." Often, editors at boutique magazines turn him down with the line, "we only cover green luxury items." Zakes is incredulous, "Green LUXURY items? That's an oxymoron!" 

TerraCycle upcycles all the time -- like when it needed to expand its factory, it grabbed a super-cheap, empty 250,000-square-foot facility in run-down Trenton. Yes, the gangs and the heroin and the "white flight" are real, but with a little bit of diplomacy, TerraCycle won over the locals.

Today, if you stroll through the factory, you find workers who chat amiably in small groups as they put labels on bottles and fill containers of fertilizer. Tanya Dave says she likes "the diversity" of the work -- it has her "always doing something different."

That said, the full truth about TerraCycle is that most of its manufacturing is outsourced. What TerraCycle has excelled at is not production, but design and sales inside a new green-business paradigm.

See more stories tagged with: environment, waste, terracycle

Sander Hicks runs the Vox Pop/DKMC media machine and coffeehouse. He is publisher at the New York Megaphone newspaper and author of The Big Wedding: 9/11, The Whistle-Blowers, and the Cover-Up. He lives in Brooklyn.

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