Positive stance at Straight after ups and downs

Container and environmental products group Straight plc has recently celebrated its 20th anniversary and revealed that its manufacturing facility has recorded six months of profitability.

The water butt to food waste caddy business, developed by Jonathan Straight, started life before recycling took off in the UK. Today, Jonathan is chief executive of the business which is listed on the Alternative Investment Market, and is proud of where the company is positioned, with a stronger financial base, the manufacturing facility in Hull and a developing range of products.

Almost two thirds of the groups supplies are now produced in its own factory. But, he is also not afraid to highlight the difficulties the business has faced over the years as it – and local authorities – grappled with the vagaries of government policy, droughts and wet weather and the financial challenges of the recession years.

Jonathans roots in recycling go way back to 1993 and in fact even earlier outside of Straight activities. He was originally a consultant to Paxton part of the McKechnie aerospace engineering group which was involved in containers for materials handling and had identified a market for recycling containers.

Paxton provided products for bakeries, supermarkets and distribution centres and the company was to become the market leader in returnable transit packaging, developing the Maxinest crate which replaced disposable packaging. The operation was subsequently acquired by Linpac.

Recycling was something or nothing in those days, Jonathan explains. We paid for something twice, it had a value and we paid to bury it.

While he was asked to join Paxton at its Nantwich site as environmental product sales manager for Paxton at its Nantwich site, Jonathan says he felt that he didnt want to formally join the business. It was agreed that I could sell the products as an independent businessman. We had two products, the twin bin and an oil recovery bank for oil with all produced by rotational moulding.

Paxton was doing injection moulding at Walsall and the company went on to produce recycling boxes with Jonathan selling the injection moulded products to local authorities, the first being Milton Keynes.

He worked locally for the third sector group SWAP in Leeds and from 1993 had an office, a phone, a laptop and a fax machine.

Development

Straight, as a business, explains Jonathan, has translated ideas into things that will work. I didnt invent the kerbside box but made it to the right size and in the quantities needed.

In the early days this involved working with various manufacturers but in particular he developed links with Milko, the Dutch manufacturer of waste bins and compost bins.

They needed someone to sell this in the UK and I was fortunate to have been there at the time. Demand didnt start immediately but enquiries started in 1994 started when supplementary credit approvals were given for recycling.

Straight Recycling Systems became a limited company in 1999. In 2000 the business moved to larger premises in Leeds and then a period of growth followed. Jonathan recalls: In 2002 the government said we are serious about recycling now. There was a fund of 140 million to get it going. It was so busy, ridiculously busy – everyone wanted stuff at the same time. We were trying to do our best, delivery times missed a beat and it is fair to say we stretched our customers patience a bit but we did deliver thousands of containers.

The companys turnover was to soar, from 2.5 million in 2001, doubling by 2003 and then doubling again.

The business was floated in 2003 and Jonathan says that this was an ambition he always had. We floated at 5.5 million and this was followed by a meteoric rise in share price. Blackwall was acquired in 2005.

Profile

Known for his handlebar moustaches and the fact that the brand is eponymous with his name, Jonathan says he is always conscious of profile. Brand is important and has a real value. For us this is not just Straight. We have, for example, Harcostar on our water butt side and in our products range we have all the Top 5 gardening Which best buys.

The business has had its ups and downs. Jonathan remarks: We have had some good years, and some havent been so good, counting, six good and four not so good. We had trouble with our retail side in 2007 and eight, in part because the 2006 drought was to knock us later. Every water company bought butts then which meant demand reduced the next year. At the same time WRAP kicked off its composting bin campaign in 2006. 80% of orders were coming in by phone and we were inundated with calls – even with expansion of our call centres we know it could still take 20 minutes to get through at peak times.

The recession also impacted on demand but now there appears to some light at the end of the tunnel. The company has expanded with the Hull facility, the Pickles fund has helped create some increased demand for the recycling range, despite causing difficulties initially because of delays to the fund, and any pick-up in the economy should boost the garden side.

With a financing packaging secured in June this year (see letsrecycle.com story) Jonathan believes there is still a lot of opportunity for the business. There is a lot to go for still. With the drive for efficiency, councils are changing what they are doing. With new schemes where old systems are changing, we can actually reprocess the containers back again.

But he remains critical of the lack of enough direction from government. I think there are many who think the government has turned a blind eye and said let the industry sort it out in which, in an absence of targets, is very wrong.

Within Straight itself, Jonathan is aiming for a suite of green credentials. The companys factory is running on renewable energy, and anything made there will be taken back eventually for recycling. He notes: We are trying to work in a circular manner, for example 90% of the raw material we use is recycled.

On the social side of the company, staff charity donations are matched by Straight. The business is also a member of the Social Stock Exchange, an online portal to promote investment in businesses with social or environmental impacts.