Rob Kuepfer is the sort of guy who doesn’t much care for luxuries and corporate excess. So perhaps it’s not a surprise that when he was working on the floor of a Cambridge, Ont., vinyl manufacturer in the early 2000s, he was struck by the sheer quantity of waste foam that the company shipped off to the landfill due to minor defects. And he had an idea: why not use that material for other things?
In effect, the birth of Vinyl Trends Inc.—a 22-employee Kitchener-based company that ranked 414thon the 2014 PROFIT 500—was all about finding the riches buried deep inside a dumpster. It’s a story that has driven the growth of many entrepreneurial green businesses.
Just a few years after he started making barbeque mats and other vinyl products from factory scraps, in 2001, Kuepfer was shipping truckloads of custom-cut vinyl pads geared to the laminated floor industry to U.S. distributors.
By 2009, with the U.S. homebuilding industry tanking, Kuepfer was in the process of setting up the first of his two U.S. factories. These days, he’s watching his revenues double annually, and is pondering whether to commit all his export resources to the U.S. or develop markets outside North America.
When Kuepfer initially reckoned he could find new uses for all the waste vinyl at Canadian General Tower, where he was working as an inspector, the company’s waste-management manager was only too happy to give him the material for free. After all, the company—which made pool liners, laminate foam for dashboards and roof membranes—had to pay shipping and tipping fees to dump all that stuff at the landfill.
“I would ask if I could take a roll, then a pallet, then two pallets,” he recalls. Kuepfer initially sold the barbeque mats to local hardware stores. One day, his contactor called and said they had a truck full of rolls they needed to unload. Kuepfer had a look and reckoned it had $40,000 foam on board. “I obviously couldn’t bring that in my home,” he chuckles. Instead, Kuepfer asked some contractor friends if they wanted to buy under-padding from him when installing floor laminates.
It turned out to be the right question. A growing number of contractors and renovators were turning to laminate flooring instead of hardwood, which was not only more expensive but also susceptible to warping due to moisture. Indeed, as Kuepfer notes, many hardwood flooring suppliers know they’ll face so many defective product claims from consumers that they often add a 5% premium to their unit pricing to cover the cost of providing replacement flooring.
Realizing he’d hit a geyser of demand, Kuepfer began to buy new vinyl from the handful of other major Canadian manufacturers and cut it to meet the needs of flooring contractors.
“The problem with scrap,” he reflects, “is that no one makes it on purpose so there’s a limit on the amount.” And as the business grew, he needed more and more of it. (He still sources scrap vinyl for barbeque mats, but says that market “is a very difficult business to grow.”)
In 2005, Kuepfer decided to look to the U.S., which was then in the midst of an unprecedented home building boom. He’d been going to trade shows and working the floor, meeting people and building a network of people who worked for his large suppliers and were happy to provide him with pointers.
Kuepfer doesn’t recall having any difficulty connecting with a couple of reputable U.S. building products distributors, and he suddenly found himself with a steady flow of orders from south of the border. “It was relatively seamless,” he reflects. And the ease of that transition to exporting came as a bit of a surprise: From listening to Canadian business commentators and watching programs like Dragons’ Den, Kuepfer had soaked up the message that exporting wasn’t for the faint of heart. His own experience could scarcely have been more different.
To better service his U.S. customers, Kuepfer established a small plant in Georgia that was fitted out with state-of-the-art equipment for cutting the large rolls that come from the vinyl manufacturers into custom-sized products for his contractor customers.
Besides those productivity-boosting investments, Kuepfer, who sees himself as something of an inventor, moved to protect his U.S. market share by honing his product offering. He developed a specialized edging for his under-padding products that was meant to function as a strengthened vapour barrier. “That was one of the biggest things that we’ve done to increase sales,” he says. The company also tinkered with the composition and density of its vinyl so that it would cause the laminate to sound like a genuine hardwood floor.
Vinyl Trends sailed through the U.S. downturn—Kuepfer says he was able to hire easily when setting up his factories because so many people in the home building sector were losing their jobs—and picked up customers further afield, in New Zealand and South Korea. He’s looking at opportunities to recruit distributors in Europe, Asia and South America, but hasn’t locked into anything, largely because there’s so much potential left in the U.S. market, where he knows the floor beneath his feet is as firm as can be. “It’s kind of [a case of] picking your battles.”