Hard times have forced the closure of InterGroup International, an Ohio-based recycling firm. High debt load combined with falling prices and customers unable to pay their bills are the causes.
The company once had $20 million in revenues. That fell dramatically, given that the price of recyclables has nosedived. In 2016, its revenues were $11 million, which didn’t satisfy the requirements of its lender.
“Several of our customers have gone bankrupt, leaving us with $1.2 million in uncollectable receivables,” said Neil Gloger, to Plastics News. “We never missed a payment to our bank, but they have regulations that they have to follow.”
The firm had been in business 11 years and will close by month’s end. Plastics News said that five of the recycler’s customers have filed for bankruptcy. The customers included a mix of compounders and processors, it said.
InterGroup’s locations are in Ohio, Georgia and Missouri. Its machinery and scrap will be sold by the lender — Fifth Third Bank of Cincinnati.
“In 2012, we were getting 22 cents per pound for material that we’re now getting only 5 cents for,” Gloger told Plastics News. “That’s part of the problem.”
InterGroup’s business included polypropylene, sourcing scrap from industrial packaging, automotive and housewares, the news site said. The firm also recycled polyethylene, polystyrene, PVC and PET, it added.
This article was originally published by Environmental Leader in February, 2017.
What lessons can start-ups in the waste recycling industry in Nigeria learn from InterGroup’s sad fall? Is there really any firm that is too big or too promising to fail? How do we entrench sustainability and international best practices in environment-related businesses in Nigeria?How do we maximise Nigeria’s potentials in waste and environmental management?
In the weeks and years ahead, in collaboration with other stakeholders in environmental management in and outside Nigeria, wastesmart.org will be finding answers to these and many other questions… Watch out!
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