From a one-man operation to a company that recycles 7 million pounds of urethane per year, Paul Reynolds built twenty-five years of sustainable success
When Paul Reynolds looks out his office windows, he scans a picturesque terrain replete with tall Wisconsin pines, and wild apple and cherry trees. Behind his building, a pond is a magnet for wild turkeys and other wildlife that routinely trot across his parking lot and into the woods.
It’s a fitting setting for Reynolds Urethane Recycling Inc., the environmentally-friendly Madison-based company Reynolds launched 25 years ago.
“This area is perfect for our operation,” said Reynolds.
This part of the Midwest is full of companies that use polyurethane in products and packaging materials. Most carpet padding is made of bonded polyurethane. It is also used for furniture cushions, and even medical devices, audio speakers, and headphones.
Reynolds can attest to the fact that polyurethane is one of the world’s most widely recycled materials. His company does its part to keep the product out of landfills. It collects tons of polyurethane by the truckload, then hauls it to its 30,000-square-foot industrial plant where it is cleaned, sorted and bundled to be sold to longtime customer Leggett & Platt, and other businesses.
Leggett & Platt uses the material to make bonded polyurethane carpet padding.
Reynolds, who grew up in Council Bluffs, Iowa, never envisioned his career path would head in this direction while putting himself through college at the University of Nebraska-Omaha. He studied law enforcement and wanted to follow in the footsteps of other family members with careers in public service.
While working at a fabricated furniture parts manufacturing company , his boss convinced Reynolds that he had a better future in business than police work. Reynolds left school, and after a series of promotions became a plant manager in 1976 at the company’s new facility in Madison.
Sixteen years later, Reynolds decided to start his own business. Reynolds Urethane Recycling was born.
He set up shop in a tiny 2,000-square-foot space and made contacts at carpet stores — doing the hard work of going through their dumpsters to haul, sort and clean pounds of polyurethane. Reynolds Urethane was a one-man operation.
Reynolds said his big break came through a meeting with Clyde Scott, a Leggett & Platt buyer. As Reynolds recalls, Scott told him ‘if you’re loyal to us, we’ll be loyal to you’. “We will dance with the person that brung us,” says Reynolds.
When Leggett & Platt placed orders, Reynolds’ company delivered to plants in Aurora, Ill., and Berwick, Pa. Today, Reynolds said, most his company’s business is with Leggett & Platt.
“We try to feed the stock they need, and when they need it,” Reynolds said.
Managing twenty-five years of growth
As his business grew, Reynolds reinvested in his company, adding fork lifts, high-speed bailers, and people. The family-owned company, which moved into its current industrial park location two years ago, now has 24 employees, including Reynolds’ son, Jacob Reynolds, who is the general manager. There’s also a fleet of 80 trailers powered by eight semi-tractors.
The business still recycles carpet. But the pounds Reynold’s once recycled from a few dumpsters now numbers seven million pounds a year, he said.
Doing it right, diversifying and looking ahead to maintain success
Reynolds, 64, knows his company isn’t the only one providing polyurethane recycling services. It’s also a thin, profit-margin industry where a few pennies per ton in pricing can make a huge difference.
Moreover, fuel prices are a constant worry because of the impact on his trucking fleet. Reynolds also must monitor consumer tastes for natural hardwood flooring and other flooring products in their homes that reduce demand for carpet.
“You have to watch everything you do,” Reynolds said.
But, he’s maneuvered well, creating a company that generates more than $3 million a year in revenue.
How does he manage growth in an equipment-intensive operation? By analyzing every diversification for its return on investment and future growth.
Reynolds believes his company also has an edge, partly because it has proven it can deliver clean, debris-free polyurethane to Leggett & Platt and other customers. Doing it right, Reynolds said, builds trust with customers, and that translates into more business.
Like any business, change is inevitable, and Reynolds recognizes there may be opportunities ahead to diversify and grow. For example, there are any number of different plastics, he said, that could be recycled into marketable products.
“Always look to diversify” to buffer risks, Reynolds said. But he noted, there is “no practicality to re-inventing the buggy whip.”
Instead, Reynolds said, ask yourself what else can you, your people and the equipment do?
He’s followed that philosophy since the early years. “When I started, it was just me,” he said. “Now, I have the added responsibility of employees depending on my decisions, and hopefully, with the good Lord’s help, they are the right ones.”
Managing cash flow and other challenges
In an industry with thin margins, cash flow is one of the challenges Reynolds faces. “I’ve got to have good cash flow because I pay my suppliers right on the spot,” he said.
His customer, Leggett & Platt, offered C2FO.
“C2FO is a tool we use to keep our business flowing,” Reynolds said. “Just like good people, good equipment, and loyal customer relations … they are all necessary to succeed.”
While Reynolds has relied on C2FO only for meeting short-term cash-flow needs, he said the service has freed up additional capital to make payroll and finance expansion as he looks toward the future and diversifying his business.
When asked about the key to his quarter century of success, Reynolds reflects.
“Be honest,” he said. “Some suppliers take the attitude of “when in doubt, ship it out,” even if the product has flaws. We do not do that … always be upfront.”