Blanket Security

Like many confidential shredding firms, Shred Works has its origins in the paper recycling business. Richard Talvola has worked in the scrap paper brokerage and processing business since the 1970s and founded the Burlingame, Calif-based brokerage Fibre Trade Inc. in 1987.

By 1993, Richard started a scrap paper processing plant under the Recycling Works name and, just one year later, started the Shred Works business unit to tap into the growing demand for document destruction services.

"I had to look for a regular revenue stream and shredding seemed like it," recalls Richard. "Many recyclers were being paid for doing shredding but not necessarily following through and doing it. I decided to do it properly."

While Fibre Trade remains based in Burlingame, Shred Works operates from a facility in Oakland near that city’s professional sports venues, Network Associates Stadium and the Oakland Coliseum, a few miles from downtown Oakland.

Richard (left) and Greg Talvola

Greg says that Shred Works was not the first document destruction company in the Bay Area, but that it quickly set out to distinguish itself by emphasizing the security aspects of its operations. "At that time, there were companies offering shredding, but we did not think it was particularly secure," he says. "Shred Works saw the need to offer greater security."

The Shred Works decision to pay attention to security is evident at its plant site, where several gates stand between the sidewalk and the shredding machines, and on its Web site, where the company boasts of its National Association for Information Destruction (NAID) AAA certification and the security and background screening services it uses provided by Choice Point.

Greg says that the plant’s initial design of being "completely enclosed" and protected by several fences provided it instant credibility vs. competitors at the time, some of whom he says shredded documents in facilities that "were open, like a horseshoe; you could just walk in and walk around."

The Shred Works plant is also monitored by 15 cameras, says Greg. Not only do these cameras help monitor employee practices, they can also record the destruction process for customers who wish to view the process via a digital file accessed through a secure Web site.

Visitors to the plant sign in at the Shred Works front desk and "are always physically escorted" through the plant, says Greg. Even visitors only view the shredding plants through a chain link fence, rather than having access to conveyors with as-yet-unshred documents.

Attention to security was part of the reason the company has chosen to offer in-plant destruction rather than mobile, on-site shredding services. "We feel that a plant is more secure," says Greg. "The bins are all under cameras when they are unlocked at our plant."

He adds that the NAID AAA certification process, which Shred Works achieved in 2002, helped it solidify its security practices. "We were performing to a lot of those standards already, but the NAID certification process helped us clarify our security procedures by putting them in writing," says Greg. "It also spurred us to acquire additional insurance and enact a random drug testing program."

Richard says the errors and omissions insurance policy carried by Shred Works is far superior to an ordinary property theft policy, because it covers liability related to identity theft, as opposed to standard property insurance.

A reputation for security is too important to a document destruction company to be taken lightly, says Greg. "If you have one breach of security, your reputation can be done. Security is your key to being successful."

Greg and Richard can see several possibilities for growth for Shred Works in the Golden State.

This growth can come as a result of several different strategies, including geographic expansion and branching into different services.

The company’s steady growth means that Shred Works will be moving to a larger facility in Oakland some time in 2005. "We’re going to be moving into a new, upgraded facility, with some additional equipment to expand our electronics and electronic media destruction services," says Richard.

California’s enactment of electronics product take-back and recycling laws will cause Shred Works to examine if it can play a part in that growing business.

Beyond Oakland, the Talvolas say Shred Works has plans to open additional locations further away from the city. "We have plans for three satellite offices in California alone, and we’re looking at investments in other states," says Richard.

Although the company has previously declined to operate mobile trucks in its Bay Area market, the company may use the vehicles to serve other regions. The larger Oakland facility could also allow Shred Works to expand vertically into records storage and management.

The FACTA (Fair and Accurate Credit Transactions Act) rules that have been spelled out at the federal level should provide another way to reach existing businesses that previously declined to hire an outside secure shredding company.

The expanded market will be necessary in a competitive landscape. "I complain about the competition, but it makes us think and come up with new strategies for growth," says Greg.

Amidst the challenges and opportunities, Greg believes the company’s emphasis on security will remain a crucial way for Shred Works to distinguish itself in the market and remain viable.

"Our biggest challenge is demonstrating to our current and potential customers that there are major differences other than price between information destruction companies," he says. "I feel security is the key to everything in our business."