People, patience and profit

If you’ve followed Brett Ekart on LinkedIn, you know he extols the virtue of hard work and is grateful for the success United Metals Recycling, headquartered in Caldwell, Idaho, has had. You also know that Brett claims little of that success for himself and instead attributes it to the team that United Metals Recycling has built.

“Building a business in the scrap industry is similar to most other industries,” he says. “In my opinion, it comes down to people, patience and profit. You need to surround yourself with great people, deploy a ton of patience and put as much profit as absolutely possible back into your business.”

Brett is the third generation of the Ekart family to own United Metals Recycling. His grandfather Bert Ekart founded the company in 1972 as United Metal & Scrap Co. Inc. While Brett joined the company full time in 2004, he grew up in the business, spending his Saturday mornings as a child watching cartoons in his grandfather’s office while his parents worked. “I always knew what I was going to do in life,” he says.

United Metals Recycling was a “typical family-owned business with multiple family members involved over the years,” Brett says of the company’s first 25 years. However, that changed in late 1990s.

Partnering for growth

In 1997, so that Bert could retire and United could grow, Brett’s parents, Rod and Debby Ekart, formed a partnership with Portland, Oregon-based Schnitzer Steel Industries, then privately owned, and United Metals LLC was formed.

Brett says Schnitzer bought 50 percent of United, providing liquidity to help grow the business through the addition of equipment and geographic expansion.

Not long after that, Rod and Debby retired, leaving Brett as the only Ekart to own and manage the business.

While United Metals Recycling’s leadership team is no longer related by blood, Brett says they are “related by a passion to build a business that we can all be proud of at the end of our careers.”

In addition to providing the capital to expand the company’s processing capabilities and the number of facilities it operates, Brett says the best part of the Schnitzer partnership was that it taught United Metals Recycling how to be a “more mature company.” He likens the business relationship to a marriage. “We had someone else to be accountable to,” Brett says. “Someone who depends on you to do your part.”

By 2015, with base metals markets on shaky ground, Schnitzer Senior Vice President and President of Operations Mike Henderson “could see my dad and I were at a point where we needed to do something,” he says. “We needed to own it 100 percent or be out of it 100 percent.”

Brett explains that, later that same year, “we were given the opportunity to buy back Schnitzer’s 50 percent and become a 100-percent-family-owned company again.”

At that point, Brett says, the companies made the mutual decision to end the joint venture.

“It was a great partnership for us and lasted for almost 20 years,” he says.

Over the roughly 18 years that Schnitzer had a stake in the business, United Metals Recycling grew from operating two yards to operating eight.

United Metals Recycling changed in other ways during that time, too. “When I started full time in 2004, 60 percent of our business was retail scrap, and 40 percent was industrial/commercial,” Brett says. “Now we are probably 75 percent industrial/commercial and 25 percent retail as the service aspect of our business has really changed.”

He adds, “In today’s world, if you want the scrap metal, you must find ways to go get it, hence the reason we have invested so heavily in our mobile pickup, mobile processing and drop-box business.”

That segment of the United Metals Recycling business was started in the late 1990s with a handful of bins and a couple of used roll-off trucks purchased from Schnitzer, Brett says. Today, the company has more than 3,500 of these containers in inventory. “We are proud to say that we transformed into a customer service business that happens to be involved in the scrap recycling industry.”

Finding its niche

Brett refers to United Metals Recycling’s mobile processing capabilities as a specialty. “We do a lot of mobile landfill baling, car crushing and a lot of industrial and farm cleanup work,” he says, noting that these mobile processing services account for 30 to 40 percent of the company’s overall business volume, though he adds that demand is driven largely by the strength of scrap prices. “But 100 percent [of our business] is customer service,” Brett says. “That’s how we win.”

He says the company used to do more demolition work in the past but that it has pivoted over the last few years. Today, the company is focused on helping existing demolition contractors once they have secured the job so that United is not competing directly with its customers.

Brett adds, “We believe the key to our success in the recycling business has been our willingness to go get the material and provide services (i.e., drop boxes, mobile processing, mobile weigh and pay).”

The company applies that same outlook to the vehicle salvage sector. While United Metals Recycling has a 50 percent ownership stake in B&K Recycling, which operates two auto salvage and scrap recycling locations in Oregon, the company was more involved in automotive recycling previously.

“People think that auto salvage and recycling are similar,” he says, adding that they are very different businesses. “It’s one of those lessons I had to learn the hard way,” Brett says, explaining that he took the company more deeply into the auto salvage sector than he should have, operating a total of two additional sites.

“Our goal is to support our customers rather than compete with them,” Brett adds. Therefore, the company closed these locations and converted them into commercial storage facilities.

United Metals Recycling’s service area is within 500 to 600 miles of its locations, given the lack of population centers in these areas. He says, “To create volume, we have to stretch.”

Brett adds, “The only product we buy nationally right now is catalytic converters, and that is through our Converter Reclaim division.”

That division is on a growth trajectory, Brett says. Converter Reclaim already decans converters and has a relationship with a U.S. smelter, but the division is expanding its processing capacity and relocating to a bigger space at United’s Caldwell site. He says these changes will improve Converter Reclaim’s throughput.

“There is a huge need for this material in the value chain,” Brett says of the platinum group metals (PGMs) recovered from catalytic converters. “It will only grow more intense as the focus on emissions grows stronger.”

Despite the projected growth in electric vehicle (EV) manufacturing and sales, Brett says he believes PGMs recovered from converters will remain in demand. “By 2030, EVs will represent 40 percent of market at best, and mines are aging out faster than we can recycle. Couple that with stronger emission standards across the world, and the PGM material will have to come from somewhere.”

Brett says in addition to its approach to customer service, United Metals Recycling’s strength lies in its processing capabilities. “To be honest, my dad was never afraid to buy equipment to create efficiency in our business, and I guess that has transferred into my DNA,” he says.

“We are not a brokerage and have no desire to become one in the future. We really just enjoy buying and processing material in areas that are near our physical locations for the most part.”

United Metals Recycling’s processed materials, however, go where the demand is, including all over the U.S. for its ferrous scrap. The company’s nonferrous scrap is sold nationally as well as internationally via brokers. Brett says the level of customer service brokers offer and the way they manage the “nightmare” that is ocean shipping logistics are why United Metals Recycling has opted to use them.

He adds that the company shows loyalty to the brokers it works with rather than chase the highest price. “Once I feel like you want the business, you’ve earned the business and have my best interests in mind, I want you to have the business,” Brett says. “One thing I love about the scrap business is that it is still relationship-driven. It’s important for me to maintain that.”

Moving material

While United is content to leave the logistics of international shipping to brokers, it ships some material by rail and uses its sister trucking company, United Hauling, as well as some third-party logistics providers, to move material over the road.

“There are some lanes where we choose not to go but are good homes for scrap,” Brett says, noting that United Hauling primarily serves the Northwest. “We do a little bit of Montana, but primarily it’s Idaho, Oregon, Washington and Utah. Those are the big lanes for us.”

“You need to surround yourself with great people, deploy a ton of patience and put as much profit as absolutely possible back into your business.” – Brett Ekart, owner and CEO, United Metals Recycling

United Hauling recently started a brokerage division to handle scrap metal for other companies. “We actually understand the logistics and what it takes to haul scrap since, this year, we have been at it for 48 years,” Brett says. “Our intent on the brokerage side is to help other recycling companies that may not be as logistically strong but may be strong in other areas get their product to market.”

He adds that United Hauling’s brokerage service will focus initially on the lanes it currently operates in and where it has the most connections. “From a brokerage standpoint, we’ll spread our wings a little bit more and go outside of our traditional lanes or traditional network.”

Brett says he thinks that United has a lot of information it can share with small scrap companies as they attempt to figure out over-the-road logistics.

Can-do culture

Brett and the leadership team at United Metals Recycling have growth on their minds. In addition to expanding Converter Reclaim, they are looking to grow Copper Reclaim. That division was established in 2011 with the addition of one wire processing line in Caldwell supplied by Copper Recovery, Huntington Beach, California. United added a second line in 2020. The company services generators on-site, weighing their material and paying for it on the spot before hauling it away for processing.

“We are always looking for ways to innovate our company,” Brett says, adding that the leadership team at United Metals Recycling has a “very open mind” concerning what the future of scrap metal recycling will look like for the company. “We have never been afraid to fail at something new, which is why innovation and expansion are always on our radar.”

Innovation plays a prominent role at United Metals Recycling, and that can be attributed in part to the diverse backgrounds of the company’s leadership team. “None of our leaders came with scrap experience,” Brett says. “I don’t go looking for other recycling companies’ employees. I look for good people and try to turn them into scrap people.”

The company’s growth most likely will take the form of greenfield operations and strategic partnerships rather than full acquisitions. “I’m not big on acquisition,” he comments. “We take a longer term approach, so we are willing to greenfield stuff or build internally.”

However, Brett adds, “We are always on the hunt for great jockeys rather than a great horse,” to partner with. “Horses come and go, but great jockeys are how you win in this industry. ”

He acknowledges that acquisitions “can work overtime as you get the cultures to mold together, but I’ve had more success just playing long.”

While profitability can take time to build with the latter approach, Brett says the business often will be more sustainable over time.

“My grandfather was a successful entrepreneur with a sixth-grade education. My dad was an even more successful entrepreneur with a high school education,” he says. “That entrepreneurial spirit runs deep in my family, and I just want to put my stamp on an already great legacy.”

Despite being college-educated and earning an MBA, Brett adds, “I don’t put a lot of value on traditional ‘brick and mortar’ education, but I do put a crazy amount of emphasis on hustle, heart and surrounding myself with great people.”

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