Good Fortune

Victor Ng

When he immigrated to the United States from Hong Kong in the 1990s, Victor Ng began learning the English language as well
as business management skills while working at a Chinese restaurant in Eastern Pennsylvania.

At the same time Victor was rising through the ranks of the restaurant to become a trusted manager, his older brother Norman was beginning to build a scrap metals business in the Eastern United States. This scrap business was the start of a group of companies that would become The Fortune Group—now a family of more than a half-dozen companies operating throughout North America and East Asia.

Victor and Norman were re-united when Norman was convinced he had a place for Victor as a manager within the Fortune Plastic & Metal Inc. subsidiary of The Fortune Group. Subsequently, Victor has proven himself as capable of helping Norman globalize Fortune’s scrap operations and of developing a business model that allows the company to compete for many types of scrap materials.

CABLE ACCESS. Norman Ng started Fortune Metal Inc. in the late 1980s in the Greenpoint neighborhood of Brooklyn. Out of necessity, he served as both president and roll-off truck driver in the tradition of many start-up recycling companies.

The business handled plastics and nonferrous metals, so naturally electrical wire and cable became an important material. Wire processing became an important and growing part of the business to the extent that a wire chopping facility, known as Fortune Plastic & Metal, was opened in Jersey City in the mid-1990s.

Both facilities have been kept busy by two important contracts with large-volume generators of wire and cable: one with the New Jersey Transit Authority, the other with a utility company with widespread operations on the East Coast.

Norman credits experienced recycling companies and the Institute of Scrap Recycling Industries Inc. (ISRI) with helping Fortune make it through its early years to become an established part of the East Coast scrap community.

As Fortune grew the volume of material it handled, it opened yet another location in 1999 in East Providence, R.I. This 170,000-square-foot plant features environmental permitting and clean-air systems that allow it to process lead-containing wire and cable.

In this decade, Norman, Victor and other Fortune staff members have continued to forge important relationships with large-volume scrap generators, such as IBM and other manufacturers with multi-national manufacturing operations.

Commitments to and from such customers have enabled Fortune to open facilities in Bakersfield, Calif.; Chicago; Dallas, El Paso and McAllen, Texas; Tampa, Fla.; Reynosa, Mexico; and Beijing, Hong Kong, Nanjing and Guangzhou, China.

The network of facilities is engaged in a flow pattern that, currently, is still centered in North America. "Most scrap we purchase is from the United States and Mexico," says Victor, "and about 70 percent of the scrap we sell in the U.S., and 30 percent goes to China."

But those percentages could change if Fortune is able to expand in China in the next 10 years as rapidly as it has expanded in North America during the past 10 years.

START TO FINISH. A key to The Fortune Group’s ability to serve its large-scale generators is its willingness to handle material through several steps in the product life cycle.

For IBM, Fortune won a key bid to handle plastic computer scrap by tapping into the research department at the University of Nanjing to develop a recycling method that met the needs of plastic consumers in that region.

Norman notes that in addition to handling scrap for customers, Fortune has also been asked to be responsible for purchasing raw materials, such as master alloys, electrolytic ingot and wire and cable.

Establishing physical plants in the regions where manufacturing scrap is generated has also been a key Fortune strategy. For the last several years, Fortune Vice President Mark Matza and other members of the company’s marketing department have helped supervise the establishment of many of Fortune’s new locations and service contracts in the Southern United States and in Mexico.

Matza in turn credits the ongoing sales and marketing work of Joseph Schwartz, who helped introduce Matza to the Ng family, and of whom Matza says, "He spent and still spends a great deal of time traveling with Norman and opening doors to our message."

Matza adds that a key to serving these customers involves more than locating a facility nearby. "It is important to identify the needs of our customers and give them options, then it is up to us to perform according to their requirements," he states. "Recycling is a service business, and we call our philosophy Dances with Wolves," says Matza, referring to the film where a U.S. Army officer begins to identify with the Native Americans he is sent to police more than with the Army itself.

"Our managers spend so much time with the customers that they identify more with them than with Fortune—but that is what we want," Matza continues. "Without satisfied customers, there wouldn’t be a Fortune Plastic & Metals Inc."

The company’s operations are global when necessary, but remain regional when financial considerations dictate. For instance, Victor says, "Most of the copper and aluminum generated from the recycling plants in the United States will be sold to [consumers] in America and Canada." However, obsolete scrap items requiring some disassembly "will be shipped to factories in Nanjing and Hong Kong, and most of the plastics generated after processing can be directly sold in the Chinese market."

Although the Southern United States and Northern Mexico remain vital manufacturing centers, nowhere in the world has manufacturing capacity boomed in the past decade the way it has in China. Not surprisingly, this has allowed Norman and Victor to return to Hong Kong and to enter the competitive field in other regions of China, as well.

As their company’s scope has widened, Norman and Victor have worked to adhere to and to spread the Fortune philosophy. That philosophy involves not only the customer familiarity mentioned earlier, but also a commitment to hard work. "Starting from the top, Norman has set a standard that we follow," says Matza. He lists "hard work, long hours, firm discipline and humility" as key qualities.

"Norman and Victor work the phones for North America during the day and then for China during the night," Matza remarks. That standard of hard work can be difficult to meet.

"Norman has sacrificed expansion and turned away business until we had the right people in the same mold," he adds.

A MODEL FACILITY. Statistics kept by government agencies in both the United States and China are cited frequently to portray the overwhelming flow of scrap materials from North America to China.

Behind the numbers, though, exist any number of methods to ship scrap overseas and to process it in China.

Leading a recent tour of China for North American customers, Victor Ng guided the visitors through a district of recycling yards located outside a village in Southern China. Very little automated equipment was in use, with laborers instead processing materials by hand.

In a nation where labor is affordable, such practices may continue to be economically viable for some time to come. However, many such methods are patently unsafe, such as dismantling electrical transformers by hand or burning plastic-coated wire and cable in open fires.

The Fortune Group has been trying to work with the various layers of Chinese national and regional government to show that recycling can be done both affordably and safely in China, with its single most important step being the establishment of the Nanjing Jinze Metallic Material Co. Ltd. in that Chinese city.

Operating from a set of new buildings that would look at home in any American industrial park, the Fortune subsidiary is engaged in a number of recycling activities. The clean, well-lit facility has received ISO 9000 and 14000 certification and has the ability to handle a diverse range of incoming obsolete materials, including but not limited to wire and cable, power tools and equipment, telecommunications equipment, small appliances, circuit boards and electronic scrap.

In one area of the plant, a workforce of some three dozen women each operates her own wire and cable stripping machine, preparing copper and aluminum scrap that will be chopped for further processing as well as plastic coating that also has ample consumer destinations in China.

In another area, disassemblers with power screwdrivers and other tools separate plastic parts from metal parts when handling such items as obsolete power drills and hedge trimmers.

Victor is hopeful that the plant’s environmentally safe and thorough recycling process can convince Chinese officials that there are safe ways to handle such scrap.

He notes that paying adherence to environmental guidance provided by government agencies is a critical part of operating in any part of the world for Fortune. "Taiwan couldn’t control scrap processing and in 1990 banned imports altogether," he notes. He says China’s EPA has embraced recycling, and Fortune has the opportunity to present its views to the agency.

At the request of the Chinese EPA, Fortune has agreed to open its doors to other recyclers, government officials and current and potential customers so they can see that recycling can be performed in China to conform to strict environmental standards.

Plans for expansion at the Nanjing facility are on the drawing board, and Victor says Fortune is also preparing "to build a second factory in Southern China to provide efficient and comprehensive service to our clients."

He sums up the company’s global philosophy by saying, "Wherever and whenever the clients need our services, The Fortune Group will establish a facility there in order to effectively and efficiently provide our service."

The author is editor of Recycling Today and can be contacted at btaylor@gie.net.