Global Recycle
www.globalrecycle.net
National Micro-Business Award Winner
Overall Winner, E-Commerce Awards 2002
Background
Global Recycle Ltd operates what is now the largest online trading exchange for the recycling industry in the world. It has 900 companies, including many multinationals, qualified to trade through the company, which are based in over 81 countries.
The company provides a meeting place for recycling companies to post material they want to either buy or sell, negotiate and be introduced to other members. This is done by giving them the speed and access of the internet mixed with traditional knowledge of the industry and constant support.
The Business Opportunity
Director and founder, Pat Daly, is a third generation Scottish. After trading in Australia, he realised that communication lines were so long in this industry that people with the contacts were in control. As that left only certain channels open, Pat realised that if one central place could be found that allowed transparency to a degree where people knew they could come and receive a price, then material would flow easier and the controllers of the central hub would gain inside knowledge that would allow them to evolve into active participation. In Jan 2000 Pat Daly formed Eurecycle.com which grew to become the largest exchange in Europe.
Wanting to develop is further, Pat saw that access to a wider market with better software plus more experience was needed. In February 2001 Pat Daly teamed up with Warren MacLeod, a senior mining executive from Canada with a formal education in e-business. Warren provided the business expertise, financing and e-business know how to take Pat's ideas to the next level. Global Recycle was formed that year. In July 2002 Warren purchased control of Global Recycle from Pat Daly and now as Managing Director of the exchange is guiding the company through its next stage of development.
The Solutions
Global Recycle has created an online platform where the key is simplicity. The simplicity and consistency of design are very important as the company deals with clients which range from 3 man family scrap yards with little knowledge of computers to multi-national corporations.
The initial business model was developed around a 1% transaction fee and involved the company acting as a direct intermediary between members in agreeing on transactions. The company continues to build on this model and has begun upgrading the trading exchange to include automated charges for new member registrations and introductions between negotiating members.
In addition, the upgraded exchange will now provide a range of new features that will provide members with a smoother negotiating platform that will allow them to expand their business networks to sell and buy recycling materials throughout the world. Global Recycle monitor everything that comes through the exchange (up to 750 unique introductions per month) to ensure members get the best possible response when posting their Sell or Buy requests on the exchange.
To get the company name out into the industry, Global Recycle has promoted the site through email marketing. In addition to their 900 members, an additional 5000 companies globally receive the Global Recycle 'Trade Alert' weekly.
Success
The company's early success is founded in its low start-up costs coupled with a low cost operating philosophy and development of its trading exchange in small incremental steps. Since the exchange was established, the company monitored site usage and initially identified four cornerstones of growth; these being member registrations, the number of postings on the exchange, the number of negotiations between members and the number of introductions between members. Having outperformed its expectations in developing these four areas, the company achieved a level of member trust and understanding that allowed it to test the components of a sustainable business model.
The company is initially building the business model around an automated payment system drawing income from the member registrations and member introductions. Pending the success of this revenue stream, the company will endeavour to build a more sophisticated system that will provide a platform for the entire transaction process from introductions though to the delivery of materials to the buyer. Time will tell if the business model is successful, but the company's low cost approach allows the time to fine tune the business model, build member confidence and establish a position of market domination.
Warren MacLeod commented:
"There's no doubt we've been successful in seizing the initiative in an industry previously dominated by traditional relationships. The industry is realising the benefits of technology and embracing Global Recycle as a leading player in providing a platform to build a global network and achieving worldwide visibility within the recycling marketplace. I'm confident we've touched upon a global opportunity, but we haven't lost site of the fact that we're a small developing business and are focusing primarily on building a self sustaining business model."
Global Recycle was named the only non USA company in this year's Top 50 Companies on the Web by the respected technology magazine CIO. The company was noted for its potential and survival ability and was ranked alongside heavyweights such as Cisco Systems, Ford, J.P Morgan and Ernst Young.
The company was also named National winner of the UK online for business/InterForum E-Commerce Awards 2002, beating 1682 other companies and receiving a cheque for £30,000 from the E-Commerce Minister, Stephen Timms.
The Future
According to Global Recycle, the recycling industry, albeit one of the largest in the world ($400billion) , is not ready to do everything online and will focus its growth in small incremental steps according to the requirements of its members. It will be the members that dictate the pace and direction of growth and Global Recycle will be there to listen and respond.
Future projects include launching the upgraded negotiating platform as well as the automated payment system for member registrations and introductions. Although the company has a long list of features and services it wishes to provide its members, growth will continue to be managed in a cost effective and incremental manner directed by the priorities of its members.
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