Adam Weitsman’s appreciation for the scrap metal industry was not heightened until he found himself at a personal low point in life almost 10 years ago.
Adam, whose father Harold Weitsman brought him into the industry in the early 1990s, says that in his first stint in the industry he immersed himself in trading and the financial aspects of the business.
That path led him to speculation, a huge accumulation of debt installing a shredder and financial trouble that he tried to cover up by deceiving his company’s bank—a crime for which he was convicted earlier this decade.
Since that time, he says he has learned humility, been thankful for colleagues and associates who did not abandon him and has
cultivated an appreciation for the machinery and operations aspects of the scrap industry that produce the profits before they are recorded on a spreadsheet.
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Upstate Shredding / Ben Weitsman & Son at a Glance
Principals: Adam Weitsman, president; Steve Green, vice president
Locations: Upstate Shredding, Owego, N.Y.; sister company Ben Weitsman & Son has facilities in Owego, Binghamton, Ithaca and (soon) Syracuse, N.Y.
No. of Employees: 150
Equipment: 10,000-horsepower M-122 Mega Shredder capable of producing more than 400 tons per hour of shredded ferrous scrap (currently being installed with Riverside Engineering in cooperation with Metso Recycling to replace an existing shredding plant); shredder downstream system featuring six drum magnets, nine eddy currents, air separators and other magnetic units provided by SGM Magnetics and a metal sorting system and heavy media plant designed by Tom Valerio and Metaltech; shredder electric motor work being performed by Mueller Engineering division of Metso Recycling; Sennebogen material handlers; seven Stanley LaBounty and Genesis mobile shears; Kawasaki and Caterpillar loaders; more than 1,300 roll-off containers deployed
Services Provided: Recycling of post-industrial and obsolete ferrous and nonferrous scrap
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As of mid-2009, Adam, his wife Kim and several key associates have helped build Upstate Shredding LLC, Owego, N.Y., and its sister company (Ben Weitsman & Son) into one of the East Coast’s largest privately held scrap companies. The organization will process more than 600,000 tons of scrap metal this year and will soon operate one of the industry’s largest auto shredding plants.
METAL LEGACY
The steep hills and river valleys of New York State’s Southern Tier have long been home to manufacturing plants that helped provide feedstock for an accompanying scrap metal industry.
Morris Weitsman was an immigrant from Russia who entered the United States through Ellis Island in the early 20th century and moved to Owego to work for the former Champion Wagon Works.
Morris eventually opened a dry goods store in Owego. His son Ben followed Morris’ entrepreneurial example by starting a used auto parts business in 1938. That business evolved into a scrap processing company that was incorporated in Owego in 1958 as Ben Weitsman & Son.
Ben’s son Harold Weitsman managed the business for several decades (before retiring) with an eye toward growing the business that Adam has tried to emulate as he builds Upstate Shredding.
“My grandfather founded the company, and my dad’s the one who pushed it to grow for a number of years,” says Adam. “If not for my father’s work ethic being handed down to me, Upstate Shredding wouldn’t be where it is today.”
Since 1998, the auto shredding plant in Owego has been incorporated separately as Upstate Shredding, owned by Adam. It is a sister company to Ben Weitsman & Son, owned by Fred Weitsman. The Ben Weitsman name remains attached to several retail feeder yards in cities such as Binghamton and Ithaca, N.Y., and facilities to be constructed in Syracuse, N.Y., and Scranton, Pa.
Among the things Adam says he’s learned: “My father taught me it’s better to expand in a downtime. The cost of land and equipment is cheaper, your lead time to install equipment can be shorter, and the suppliers can give you more attention.”
After overseeing Upstate through the boom years from 2003 to mid-2008, Adam has been putting the philosophy into action now that the market has turned downward.
Although that was one of many lessons Adam absorbed from his father, there were other lessons that Adam learned for himself early this decade as he emerged from what was clearly a low point in his life.
LESSONS LEARNED
Adam, who is 40, divides his years in the scrap business into before he got into trouble with the law and afterward.
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AMERICAN IDOLS
Adam Weitsman, president of Upstate Shredding, Owego, N.Y., might be able to name a few popular actors and athletes, but he says they are not the celebrities he truly admires.
“Other people’s idols are on TV, but mine are George Adams [of SimsAdams Recycling] or John Neu [of the former Hugo Neu Co.],” says Adam. “Those are the people—and I’ve never met them—I look up to, and I try to model the way I do business after them.”
He also cites Daniel Dienst of Sims-Metal Management and Dan DiMicco of Nucor Corp. as corporate leaders whom he greatly respects.
Atop the list, however, are his father Harold Weitsman and his late sister Becky, who was involved as a manager with his father’s company in the 1980s and 1990s.
Adam says his father tried to teach him any number of valuable business lessons, some of which Adam learned by listening and others that he has learned through his own trial and error.
Of his sister, Adam says, “Becky was the sweet one, and I’m the gruff one. She passed away from cancer in 2000. It has been a lonelier place to work without my sister looking out for her little brother.”
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“I didn’t know what I was doing when I was young,” says Adam. “I tracked copper pricing at my desk and I wanted to be the wheeler and the dealer.”
He also became involved in side projects, such as an art gallery in New York City and commercial real estate development in upstate New York.
His handling of the scrap company’s finances became difficult when a shredding equipment supplier went bankrupt before it could complete delivery of the Owego auto shredding plant. “I got desperate and did some check kiting and floating of funds; it set off red flags with the bank, and I was arrested in 1998 and eventually paid a $1 million fine and went to jail for one year in 2004.”
Adam says the events leading up to the arrest, the consequences of his actions and the responses of others to what happened have all combined to teach him a great deal.
“I learned a lot, and it changed my whole persona,” he comments. “I realized how important integrity was in life overall—with customers, bankers, my family.” He notes that he still maintains a strong relationship today with the bank with which he got into trouble.
Many people who could otherwise have abandoned him or kept him at arm’s length instead helped him through the crisis, says Adam. “My wife Kim left her career in New York City and ran the shredding operation while I was in prison,” he comments.
“My father’s reputation suffered because of my actions, and he had no part in it back then; I felt really bad,” Adam says. “But he never said anything other than urging me to work hard, go to jail, stay tough and then make things right.”
He received help from professional associates for which he remains grateful today. “Joe Curtin and John Keys at Tube City came to visit me and made sure I had things in place to keep selling scrap while I was away,” says Adam. “Mike Pallotti of Morris Iron & Steel in Philadelphia provided a lot of help and support through the whole thing. We’ve remained good friends, and he’s going to be the godfather of my child to be.”
He adds, “Most of my customers and steel mill buyers stood by me. Nucor stuck with me and I continue to realize it’s a company with a lot of integrity. I think Nucor, Dan DiMicco and Brad Ford, head of the Nucor-DJJ Pittsburgh office, they are very ethical in up markets and in down markets, and those are the kind of companies and individuals which I try to do business with.”
Adam says his employees also stayed loyal to him, inspiring him to reciprocate. “They could have bolted and said, ‘I’m not working for a felon,’ but they didn’t. Now I see it as my job to stand by them.”
There was nothing enjoyable about legal problems and prison, he says. But in perspective, “Maybe it was the best thing for me,” says Adam. “My work ethic has changed completely.”
Among Adam’s changes is a new appreciation for his father’s approach, which includes an emphasis on processing operations.
“Now I’m mostly spending time with the equipment—that’s where my passion is, and my father was like that,” says Adam. “I didn’t think I would be, but I’m turning into my father. I find that the more I concentrate on the production end instead of trading, the more profitable the company is.”
EYE ON OPERATIONS
As Adam has kept his focus on operations, it has become a larger and larger task since both Upstate Shredding and Ben Weitsman & Son have expanded their scrap buying and processing footprints in the past four years.
In Owego, Upstate Shredding—which had already run a sizable auto shredding plant—is in the midst of upgrading to a 10,000-horsepower model M-122 shredder. “Output is definitely the key here,” says Adam. “We measure a good day by our output, and we’ll shred all night long to get product out.”
Upstate also continues to invest in its shredding plant. “We keep trying to make the quality of our ferrous shred better because now the mills have a choice of who they buy from,” says Adam. “Low-copper content may not increase your price in the short term, but it can make us a preferred supplier.”
On the nonferrous side, Upstate Shredding deploys an array of magnetic equipment to produce its ferrous and nonferrous shredded products, with SGM Magnetics and Huron Valley Steel being its key suppliers in that endeavor. Upstate also is installing a heavy media plant at its Owego site.
“In addition to being a low-cost, high-volume operator, we can make ourselves profitable by maximizing our nonferrous returns from the shredding plant,” states Adam.
Adam credits the people he works with—customers, employees, the brokers who sell Upstate’s scrap, equipment vendors—as reasons why he’s glad to be doing what he does today. “The key to this business is dealing with individuals who are great people. There are a lot of smart people in this industry, and I’m trying to surround myself with them.”
He concludes, “I’m lucky to be in this industry. My wife is here working with me. I love doing this, and I am proud that we could work hard through the bad times to appreciate these great times for this company.”
The author is editor in chief of Recycling Today and can be contacted at btaylor@gie.net.
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