That Old Plastic Bottle Could End Up in China
By Graeme King
A fast-growing Tyneside recycling business has seen sales grow 600%, partly thanks to its success in selling used plastic bottles to China.
AWS (Alternative Waste Solutions) in Wallsend is run by managing director Jonathan Short and has progressed from sales of pounds 500,000 in 2004 to pounds 3.5m in 2005.
Mr Short is aiming for pounds 7m this year and pounds 20m the next.
He has latched on to the fast-growing Chinese economy to export plastic bottles for them to be recycled into new products.
To help the business grow, AWS is investing in a pounds 1m bottle- sorting plant at Gainsborough in Lincolnshire and has attracted pounds 250,000 of investment from fund manager NEL to help get it off the ground. AWS buys plastic from waste-collection companies such as Sita and Cleanaway and uses sub-contractors to transport it to customers ( and soon to Gainsborough and to ports for export.
Mr Short said: “We will have a big sorting plant. We buy and sell all manner of plastics and paper. The new plant will sort plastic bottles by polymer and by colour ( we buy 1,400 tonnes of plastic bottles per month ( and some material will be exported.”
He says although China has developed fast, it does not yet have the same consumerism as the UK, so does not have the waste plastic required to make sufficient new packaging. AWS was founded in 2000. The company now has export relationships in several countries, including China, Hong Kong and South Korea, and opened an office in Hong Kong in 2004 to manage its growing operations in the region.
AWS employs just 11 people in Wallsend and will hire 10 more to work in the sorting plant in Gainsborough, with more to follow as it expands, and there are three sales staff in Hong Kong.
Mr Short said: “We look for containers going back to China after bringing finished goods to the UK. With China not being so advanced as Europe, they don’t have the waste going through their economy.
“They need our PET plastic and cardboard waste to recycle to make new packaging. We’ve got a good sales force in Hong Kong and can access contracts very quickly. We also have six reps on the road in the UK, up from just one 15 months ago. We have a Chinese import licence and we have a good reputation for efficiency of collections and for paying on time.”
The NEL investment is being provided via its mezzanine finance division, Evolve Finance, to help pay for AWS’s pounds 1m processing equipment in Gainsborough
Evolve Finance senior loan executive Simon Johnson said: “AWS has an excellent track record in its field, an existing presence in its target export markets and a management team with a clear vision of how to turn opportunities into commercial returns.”