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Straight talking

Jonathan Straight is one of the most recognisable and colourful characters in the recycling and waste management industry. But behind the fascinating moustache, quirky glasses and slicked back hair lies a serious businessman.The container and bin company Straight was started by Jonathan in 1993 as pretty much a one-man-band, but the company saw rapid growth and is now one of the most recognised in the sector.

It is clear from its modern offices in the heart of Leeds that Straight is a bright and colourful company with Andy Warhol-style and other pop art prints featuring Straight’s products decorating the walls. Tasteful coffee tables in the reception area made out of old washing machine drums show both a sustainable and innovative philosophy behind the business.

During the past few years, Straight has driven the company forward and, as a result, has seen it expand further.

“The expansion of the business has been in two key areas,” he says. “First, organic growth and, second, acquisition. We have accelerated the acquisition process in recent months. In the spring of 2010, we bought the UK business of Helesi, which gave us a proprietary position in the wheeled bin market, shortly followed by the acquisition of the Powell Plastics factory last summer. That gave us proprietary control over all our injection moulding activity.

“Within the past few weeks, we have put a number of blow moulding lines into that factory and that means, for the first time, we are making our own water butts and compost bins.”

As a result of these acquisitions, Straight was able to announce an 8% increase in turnover in its year-end results for 2010 at the end of January. Dyro, which traded as Powell Plastics, was bought for £2.9m (via debt) in August 2010. This meant that Straight was able to make its own bins; previously it had outsourced their manufacture, including to Dyro.

“Hopefully, bins are a bit off the radar and are not going to be affected too badly by the broader cuts”

In March 2010, the business and some assets relating to the UK manufacturing operations of Greek manufacturer Helesi were bought for £1.65m in cash. This enabled Straight to sell its own brand of wheeled bins for the first time, even though the manufacture was still outsourced. But where will further growth come from?

“There is growth in a variety of areas,” Straight says. “We are active in both the municipal and non- municipal sectors. Because those areas are driven by legislation and the green agenda, they are growing. We are capitalising on that growth where we identify it.”

He adds that the company’s core market is the municipal market and specifically kerbside containers, compost bins and water butts. But he makes it clear that this is not the firm’s only market: “The business is much more diverse. We’ve had a deliberate programme in the past few years of de-emphasising the dominance of the municipal sector. About a third of the business now is non-municipal, and we are also active in peripheral markets such as garden and hardware.”

It is through his own hard work, drive and, especially, entrepreneurship, that Straight has grown into the company it is now. But he does not always see entrepreneurship in bin manufacturing.

“In our own market [bin manufacturing] there is a distinct lack of entrepreneurship. It tends to be fairly dull,” he says. “That is good for us because we sort of shine out from everything else that is going on. But in the sector [recycling and waste management] in general, certainly in terms of new technologies, there are a lot of entrepreneurial activities and that is very nice to see.”

But he believes there are barriers that make it difficult for his business.

“[One of the barriers is] clarity of legislation and the direction of legislation. When the Waste Strategy came out in 2007, it was a great document [that said] these are the emerging trends and these are the products we might develop to pursue those trends. Of course, there is a lot up in the air now with the coalition Government. It hasn’t yet said clearly which direction it is taking.

“In more macro terms, it is access to good people and access to capital - those are the things that hold up growth.”

Part of the Government’s policy has been to introduce cuts to public sector budgets. I wonder whether this has made any difference yet to Straight?

He says: “They [public sector cuts] haven’t made any difference in terms of the sales that we are making. But they have made quite a difference in how we approach what we are doing, because we are aware that our municipal clients want better value and are much more focused on getting better value. So we are focused with them on delivering that best value.

“Also, probably a bit more of the business is going through the private contractor route than directly with the council, but that is no problem for us because we have relationships on both levels.

“Beyond that, we haven’t seen any major change. We’ve been watching visibility into April to see if things are going to fall off a cliff, and I’m delighted to say [we don’t think they are]. Hopefully, bins are a bit off the radar and are not going to be affected too badly by the broader cuts in that sector.”

Straight is a member of the Campaign for Real Recycling. At the time of this interview, Straight was not up to speed on its plans calling for a judicial review on the UK’s implementation of the Revised Waste Framework Directive and so he could not comment. But he was prepared to back the principle that separate collections do not mean commingled.

“On the ground, commingled collections are being treated as separate collections and clearly Defra has now come out with that view. But I’m not convinced,” he says. “I think if you sort something at the kerbside, then it definitely is source separation. If you collect things commingled in a bin, put them into a MRF, and do not really know what is coming out of the end, or where it is going, there is a strong case to say that it isn’t really source separation. If it does count as source separation, then it is not in the spirit of what source separation should be.”

JONATHAN STRAIGHT CV

Straight started as a pub pianist in Leeds playing “jazz background” music. He dabbled in a few other things, including selling books by mail-order, and wishes he had stuck with it to become what Amazon became. He joined bedroom furniture and then menswear companies and learned about sales and marketing. With some money in the bank, he did some voluntary work at Save Waste and Prosper in Leeds before doing consultancy work with a company called Paxton.

After losing his job there, Straight founded his company in May 1993 and floated it on the AIM stock exchange in November 2003.

The best thing in my career was…
“There are two. The first was being dumped by Paxton because that became the catalyst for it all since. And in 2003 we floated on AIM and acquired Blackwall, which at the time was our biggest competitor.”

The worst thing in my career was…
“The impact of the drought in 2006 on our water butt market. A massive demand for our water butts led to the collapse of our supply chain, and what we did to fix it didn’t work initially. Our share price dropped massively as a result and, although it has picked up since, that was a tough time.”

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