Going Mobile

There are several ways to provide service to offices with documents and files that need to be securely destroyed, and Secure Eco Shred of Farmington, Mich., provides a variety of service methods to suit its customers’ needs.

Like confidential shredding company owners everywhere, though, Secure Eco Shred co-founder Steve Kalapos must try to determine where the growth opportunities lie within that range of services.

Right now, Steve sees on-sight mobile shredding trucks as playing a significant role in the growth of his company, which is also growing through geographic expansion to adjacent markets.

Jim Greenberg entered the electronics recycling business for several reasons, including the harvesting of precious metals and the re-selling of computer components.

After all the Y2K fears that accompanied the calendar change to the year 2000 subsided, Steve Kalapos embarked on another task that can induce fear—starting his own business.

"I had prior industry experience," he notes regarding his stint working for a larger franchise operator. "I really enjoyed the business for a couple of reasons: I like the idea of doing something positive from the environmental impact of recycling, and I am also interested in the security aspects of the business."

Steve founded Secure Eco Shred along with business partner Kevin Smith, with the two of them agreeing that Steve would concentrate on selling the company’s services while Kevin focused on operations and administration. Steve and Kevin have been friends since they were in school together and have know each other for more than 20 years.

"Kevin and I have a great partnership because we are different in what we bring to the table," says Steve. "Kevin is somewhat reserved and very methodical and is ideal in dealing with the operations end of the business. I’m kind of at the other end of the spectrum; I’m always ready to jump at every opportunity, while he says, ‘Well, wait a minute—let’s consider this aspect,’" Steve notes.

Although Steve’s impulse is to act quickly when making decisions, he and Kevin leaned toward the methodical side when choosing the new company’s name. The duo hired a market research firm that conducted focus groups that considered a list of five names. "The name ‘Secure Eco Shred’ was not one we wanted; it was one of the fillers on the ballot," Steve recalls. "But the results came back with it as the number one choice—people thought it defined what we do. We secure information and it’s ecological because of the recycling aspect."

Steve now agrees that the name is a good one, although he remarks, "It’s also a lot to put on an e-mail address."

Almost all new business owners worry that the phone won’t ring or prospects will say "no" in alarming numbers.

Fortunately, since starting Secure Eco Shred, Steve says he has not had time to look back because the company has succeeded in attracting and retaining customers in Detroit and beyond.

Like many in the information destruction industry, Secure Eco Shred has benefited from the increasing amount of attention paid to identity theft crimes that can get their start from confidential documents falling into the wrong hands.

"I think people see the need for this service more and more in their daily lives," says Steve. "The concern starts there and then gets to places of employment. Identity theft is such a horrendous crime, and it’s so hard for perpetrators to get caught and prosecuted. Prevention has to be stressed."

Providing a service that demonstrates quick and final destruction—and thus crime and liability prevention—is why Secure Eco Shred has keyed in on mobile shredding service as a way to appeal to customers that want no doubt about what has happened to their files.

"I think, ultimately, the future of the business is mobile," Steve remarks. "In the end, that’s where people’s comfort zones are proving to be. There’s a comfort in seeing the information shredded. People whose own payroll check records are in there are often thinking, ‘Hey, I want to see this shredded.’ People more removed from the information may be more willing to send it off-site."

From an operations viewpoint there can be advantages to mobile shredding as well, Steve contends. "I like the cleanliness of the mobile industry," he remarks. "You send a truck there, you perform the task, you drive back and you’re done. Logistically, off-site can be more difficult because of all the containers to manage."

He acknowledges, though, that for now there is still very much a market for in-plant shredding. "The majority of what we do is mobile, but we have an off-site shredder that can run 15,000 pounds per hour in Farmington. A lot of what people know is off-site," says Steve. "There is a factor of change to be introduced, but in the end when we get 10 years down the road, I don’t see off-site as being a big component in our business or in the industry, except for product shredding."

In addition to growing market share within its home Metro Detroit area, Secure Eco Shred has moved westward into other regional markets. The company is now running mobile truck operations in Chicago and in Grand Rapids, Mich.

"We can now service the entire state of Michigan," says Steve. "The majority of our business is in our original market of Southeastern Michigan—the Detroit market and up to Flint, Saginaw and Port Huron, and down to Toledo, Ohio." He notes that when the company signs up a customer in a more remote city in Michigan, such as Ironwood in the Upper Peninsula, "it becomes important to line up some other accounts there."

As the company’s business in the Western Michigan cities of Grand Rapids, Kalamazoo, Lansing and Holland began to grow, it was able to locate a mobile truck and driver there full-time. "Eventually, we will have a full-fledged plant in Grand Rapids. We have a depot and an office now there."

The next westward leap was made early in 2004, when the company opened a truck depot in Chicago. "We opened in Chicago in May as the only mobile shredding company positioned in downtown Chicago," says Steve. "It makes a statement to the city that our commitment to those 3 million people in Chicago is where we see the opportunity—we’re a Chicago company and we’re right here for you," he states. "The truck is parked downtown and it can get to any place in the city in 25 minutes or a lot less."

Secure Eco Shred is now faced with the task of managing its growth so it can take full advantage of the opportunities presented in adjoining regional markets. "We’re really focused in Chicago on a sales growth model," says Steve. "While the majority of our staff in Farmington is in operations, in Chicago it is sales."

The Farmington plant can likely serve as a model for a plant being planned in Grand Rapids and for another that may be necessary soon in Chicago. The Farmington plant has a stationary shredder and a baler to maximize recyclable materials value. "Not all product is baled," says Steve, who notes that the plant’s shredder also engages in product and electronic data destruction.

"Our off-site equipment has destroyed a semi-load of T-shirts from a candy company that used the shirts as a promotional coupon," he recalls. "We’re in the auto industry region, so we’ve handled car seats, dashboard assemblies and interior vehicle components. We have a slow-speed shredder designed to destroy 55-gallon drums that serves us well for these tasks."

Steve says Secure Eco Shred tries to maintain a core philosophy of fair treatment toward both employees and customers as a prevailing management goal. "We genuinely care about the people that work for us, and we try to express that," he remarks. "We’re a four-year-old company that is trying to grow, which means there are times when we are understaffed. And I would love to pay everyone who works for us more, but there are difficult times when you’re a young company."

As the company has grown, it has built a talented roster of associates, he remarks. "Kevin and I are by no means a two-man operation—we’ve got this great group of people who become more responsible for the business every day. If they don’t become responsible, then none of this works."

Secure Eco Shred looks to provide the same fair treatment to its customers, and seeks the same from them. "I think it’s not too much different than dealing with the people you work with," Steve comments.

Buyouts by publicly traded firms are changing the secure shredding business in some regions, and Steve says he is watching the industry closely. "Certainly Cintas, Brinks, Iron Mountain and Shred-It are all growing, but there is still a significant role being played by the ‘mom and pop’ organizations. I would encourage them to recognize that role and continue on with what they are doing," he says to other privately held shredding company owners.

But the thought of nationwide growth is also alluring, Steve admits. Secure Eco Shred is exploring the steps it needs to take to franchise its name and business model to prospective franchisees. "We’re in the process of working with attorneys to finalize licensing agreements by November of this year," he remarks.

For now, the company’s westward march from Detroit to Chicago is keeping Steve, Kevin and Secure Eco Shred staff members busy. "We think the industry is still in a pretty early stage, and there are plenty of good opportunities out in front of us." n

The author is the editor of Secure Destruction Business and can be contacted at btaylor@gie.net.