JER Envirotech’s fresh start

The old adage that cautions against putting all your eggs in one basket hasn’t fallen on deaf ears at Delta, B.C.-based wood-plastic composite (WPC) manufacturer JER Envirotech International Corp.

This may be one reason why the 10-year-old company, currently in the midst of an extensive repositioning effort, has seen a rise in its fortunes; it reported a revenue increase of 216 per cent in third quarter 2007 over second quarter 2007, despite a sharp drop in the U.S. housing market that has put considerable dents in the profit sheets of other WPC suppliers.

“Our strategy is to not be dependent on any one particular market segment,” explained Edward Trueman, JER Envirotech’s president and CEO. “We will never lean too heavily on construction or housing or any other industry.”

Edward Trueman on the shop floor at Delta, B.C.-based JER Envirotech.

New Management, New direction

Appointed in December 2006, Trueman is representative of the new face of JER Envirotech, and was largely responsible for a management overhaul intended to shift the company’s focus from R&D to the commercialization of its products and the global expansion of its manufacturing operations. The company recently hired five new executives, with extensive business — and in some cases, plastics — backgrounds: Ji Yoon as chief financial officer, Peter Kelly as chief technical officer, Peter Baran as chief operating officer, William (Bill) Hunnicutt as vice president of global sales and marketing, and William (Bill) Anderson as vice president of manufacturing.

“We are now fielding a well-rounded, polymer-heavy management team,” Trueman said. “The company used to have an R&D mentality, but these appointments have given us a fully functional, commercial mentality. This is the blank canvas that we needed for a fresh start.”

The products that this new team has been assembled to market are designed to outperform and “out-green” either wood or plastic alone, Trueman said. JER Envirotech offers its WPC compounds in two forms: as custom-formulated raw WPC pellets that can be extruded, injection molded, rotational molded or thermoformed; and as panel boards. According to Trueman, both product types utilize recycled plastics and waste or by-products such as sawdust and rice husks to produce environmentally friendly products for the automotive manufacturing, construction and transport industries. The company also supplies a range of WPC additive formulations that it developed in collaboration with the National Research Council – Industrial Materials Institute of Canada.

Going global

A key ingredient is that these products are now backed by a strong, far-reaching marketing plan, Trueman continued. “We’re positioning our panel boards as an alternative to materials that are used in engineered lamination decking and hardwood flooring,” he said. “We are also positioning ourselves to hit the global marketplace and take advantage of the demand overseas for alternative building materials, as well as the availability of organic inputs like rice hulls.” To support this overseas development, the company has manufacturing operations in Malaysia and is currently in the process of establishing new plants in the Philippines and India, Trueman said.

It seems clear that the staff at JER Envirotech is confident in having charted the right course for continued success, as well as means of getting there. “We now have an extremely aggressive growth plan for establishing ourselves as a global player in the market for WPC products,” Trueman said. “We expect to make this a $100 million business in five years’ time.”