David Minott with his young son
Dennise Williams, Staff Reporter
"ONE TON of recycled cardboard saves 17 trees."
This is a part of the rationale behind the formation of Minott Recycling Company by David Minott, of Minott Services Ltd. Collecting 250 tonnes of garbage each day islandwide, Minott realised that 13 per cent of this garbage was paper.
After attending several waste management seminars in North America, the idea to expand into recycling was a natural progression. Thus, Minott Recycling Company was born.
Mr. Minott stated that, "The plant, located at 214 Marcus Garvey Drive, will initially process cardboard, newspaper and office paper." Taking a tour of the rented premises on Marcus Garvey Drive, Mr. Minott explained the process to Sunday Business. "Trucks bring in all types of discarded cardboard from a variety of sources like factories, supermarkets, whatever. Then the cardboard is manually separated and the exportable cardboard (without a waxy finish) is taken up. It is then put through a shredder, goes up a conveyor and into a baler. The bales of cardboard weigh between 1,200 to 1,400 pounds."
During an eight-hour day, 15-20 bales can be produced. Now, while the altruistic aspect of this environmentally responsible firm is commendable, Minott did invest to eventually make a profit. Says Mr. Minott, "In addition to preserving the environment, the new plant serves to show the company's confidence in the future of the Jamaican economy. Minott Recycling Co. plans to expand exponentially over the next 12 months."
INVESTMENT
The investment by Minott in recycling is significant. The total investment by the company has been US$100,000, including machinery and labour costs. However, Minott notes that the equipment is second hand as, "a brand new machine would be tremendously expensive." Monthly operations costs are projected to be $500,000, which includes rent, salaries, utilities and amortisation of the machine over a three-year period.
The firm now employees five full-time staff members and hopes to increase to eight employees on a double shift system as this system would, "make the company more viable." Including drivers and sidemen, the operation could add 12-14 new jobs in total.
Notwithstanding the start-up costs, Minott does see where profits can be made. He tells Sunday Business, "On the world market cardboard is US$40 per tonne." But like most new businesses, profits won't be realised immediately.
"There is no profit now, but we are looking to make a profit in 18-24 months if we get the volumes needed. To break even we need to process 300-350 tonnes of paper per month and we will reach profitability with 500-600 tonnes processed," said Mr. Minott.
By the end of October, Minott Recycling Co. expects to export 200-250 tonnes of cardboard the United States and Venezuela. The company hopes to export 10,000 tonnes per year within the next year and a half.
Minott does note that because of his commitment to the environment, "We will not shut down if we don't make a profit, because it is much better to recycle than to dump the paper in Riverton."
The one disappointment that Mr. Minott expresses is with Jamaica Promotions Corporation (JAMPRO). "I don't think that we have gotten enough support from JAMPRO. Not one JAMPRO representative has come here to view our operations. A foreign company is coming to Jamaica and has gotten all necessary help."
JAMPRO, however, stringently disputes this claim. According to Robert Kerr, senior consultant of investments at JAMPRO, the overseas-based company that Mr. Minott refers to put in an application for tax credits months before his company did so.
SCRUTINY
Additionally, Mr. Kerr asserts that Mr. Minott has the application for the tax credit in his hand and has not yet submitted it for JAMPRO's scrutiny. Said Mr. Kerr, "We would disagree with Mr. Minott's position. He has just contacted us two weeks ago. We are waiting for him to complete the application form. The ball is in his court."
The tax credits in question stem from the provisions granted under the Single Entry Free Zone programme. Under this investment incentive package, once a firm is approved by the Minister of Industry as one with a focus for exports from Jamaica, income taxes, duties and general consumption tax would be waived in perpetuity. As Mr. Kerr puts it, "The approved firm would be completely out of the tax net."
