Ted Lipman

Ted Lipman, Denbo Scrap Materials, Pulaski, Tennessee. Interviewed March 1998. Courtesy of the Institute of Scrap Recycling Industries. Transcription by Speechpad.

Ted: In 1952, the Denbo family, of which I was a member, decided to expand their endeavors in the scrap processing of ferrous and non-ferrous materials. And the need became aware for larger facilities and more involvement, and I joined the company business and have been involved since that time.

Interviewer: What did you do when you first got into [inaudible]?

Ted: It was a learning process and the learning process still continues. I have never found a dull day in any of my years in the scrap industry. Every day is another challenge and no two days are alike. And it’s a very dynamic industry.

Interviewer: Did you spend time in the yard at first or did you spend most of your time…?

Ted: I spent time in the yard, that’s where you need to learn the operation. You need to understand what makes the operation tick. Buying and selling are very ordinary functions. But the true scrap business and learning the scrap business is where it happens in the sortation and the preparation of the various grades of material.

Interviewer: What was the scrap yard like back in ’52? What kind of technology were you using…

Ted: Compared to today’s methodologies, the things that we did, the way that we did them were very rudimentary. We carried…we sheared on a number two alligator shear, We used a cutting torch. A magnet crane was almost unheard of. Things were done by hand. We didn’t have hydraulic loaders, forklifts, that kind of thing.

Interviewer: How did you get the material on the truck?

Ted: We threw it on there. We loaded railroad cars from a tipple. We loaded dump trucks and then dumped the material into a railroad car from a tipple to get it to market.

Interviewer: And when did you start to see that change? When did the industry start to become mechanized?

Ted: The technology that was developed over the years developed primarily through other industries had lent itself to the function, the day to day functions of the scrap industry. And I think our industry has gleaned its knowledge from other industries, primarily the quarrying operations. By that, I mean the loaders, the conveyors, the crushers, all of that type of equipment.

Interviewer: When did you buy your first hydraulic shear or guillotine shear?

Ted: The first hydraulic guillotine shear we bought was in 1965 or 6, somewhere along in there, ’67. I remember it very well. It was a machine manufactured by the Dempster Brothers in Knoxville, Tennessee. And it was a very nice machine at the time. It answered our requirements but as time went on, like most machinery does, it wears out. And the need to replace it became more evident and from a 250 ton shear, we went to a 1000 ton hydraulic shear.

Interviewer: When was that? The thousand…?

Ted: The 1000 ton shear we put in 1979. And that particular machine is still in place. We manufacture our own energy for that machine. We have a generator that produces the electricity to run the motors.

Interviewer: That’s a diesel generator?

Ted: No, it’s not diesel. It runs on natural gas.

Interviewer: Cool. What made you select that?

Ted: The location of the machine in our schematic of the yard operation and being able to approach it from many sides without any kind of overhead impedance and allow freedom of accessibility just by putting a one-inch gas pipe to an enginator and then converting the energy into electric units made it feasible.

Interviewer: And you also have a shredder I understand?

Ted: I operate a shredder, that is correct. We got in the shredding business in 1972. And what predicated our getting into the shredding business, we were making number two bundles. The balling press that we had in place at the time, again, had seen its best days. The price for number two bundles was not very attractive. The demand for number two bundles was diminishing and we felt that we could enhance our business operations by going to a shredder. And also some of the industrial type materials that we were processing, we felt we could make a better profit by shredding the material as opposed to doing something else.

Interviewer: Back in ’72, when you made that decision to shred, I guess the market hadn’t taken off yet, it was ’73 when it really took off. Was [crosstalk 00:07:11]

Ted: It was a very good happening that we were in place when the market took off in ’73, end ’73, ’74. Those were good years.

Interviewer: Was it a really big decision to invest in a shredder in ’72?

Ted: Not really, because at that time, the cost of installation was a fraction of what it is today. All the attenuated costs were much less, the installation costs were considerably less. And that is where a lot of people that install a machine, install equipment, really don’t pay too close attention. They focus all their attention on the basic cost of the machine. It’s the cost of installation that really runs it up.

Interviewer: And 26 years later, are you still on your same shredder?

Ted: We are operating the same machine, the same location, and with TLC, we continue to operate on a day to day basis.

Interviewer: Well, that leads me to my next question because obviously, you’ve been teaching the shredder maintenance seminar for how many years now?

Ted: We, Saul Gordon and myself did our 23rd year, this past February. And how that came about, we were real good friends. And they, the Gordons over in Statesville, North Carolina got in the shredding business about same time we did. And Saul and I are good friends and we felt in some conversations that there was a need for an exchange of ideas, not between the management people but between the people that operated these machines on a day to day basis.

They were the ones that were responsible for the day to day operations. And they were the ones that were out there in the field, coping with the problems which arose every day. The management segment of our industry was more or less interested in results. They were not in tune with all the problems that were encountered. But the biggest thing that I have witnessed in the shredding business is the technology that has been developed and the materials and the methods and the machines are now built to a standard where areas that presented problems in earlier years are no longer a problem.

Interviewer: And you’ve obviously worked on these machines yourself over the years?

Ted: Well, somewhat. I’ve been known to get my hands dirty.

Interviewer: Is that the…?

Ted: You ask my wife, she’ll tell you. I got dirty plenty of times.

Interviewer: Is that a special …?

Ted: Sorry?

Interviewer: Is that a special love of yours?

Ted: Well, I devoted many… I wouldn’t say love but I think some people take issue with me. But I would say it was certainly a concern of mine over the years.

Interviewer: Let’s switch gears a little bit. Tell me what competition was like in the industry back in ’52 when you first started.

Ted: Competition. Competition is always there in some form or fashion. There is always someone waiting in the wings that will certainly give you some problems if you don’t take care of business. The scrap business is a day-to-day, it’s a hands-on type of operation. It doesn’t run by itself. You’ve got to pay attention to what you’re doing. Otherwise, there are people out there that are waiting to do it for you.

Interviewer: So you’ve really haven’t seen much change in competition over the years?

Ted: Not really, not really. The competition that we encounter today is because of the, I won’t say shortage of raw material, but the flow of material, of raw material is not as strong as we might have seen it in years past. The Shredder, the advent of the shredder has brought in a lot of dormant material that was lying and the countrysides have been cleaned up. Mainly the solid material that we see now is almost current generation.

Interviewer: What do you think it was that has made your company succeed over the years? Is there something special?

Ted: I would say giving good service to our customers and paying attention to and taking care of the business that we had and not taking anything for granted.

Interviewer: Let’s talk a little bit about when you got in the business in ’52, had you just come out of school or were you…?

Ted: I had been in service. I was discharged in 1946, so after having been in the European theater of operations as a Combat Infantryman. And as a returning GI I attended Vanderbilt University in Nashville under the GI Bill, graduated from there in 1949. I got involved in a retail operation and about same time met my future wife. And between the years of 1949 and 1952, I was involved in retailing. But then I got the call to come into the scrap business.

Interviewer: And when you were in college, did you have a career goal in mind at that time?

Ted: Not really. I was a business major and an economics minor. And I felt that my future lay in some form of the economic system.

Interviewer: Would you say that your career goals ultimately have been achieved?

Ted: I would say yes. I feel that I still work for those goals to be successful. And at my age, I’m still involved as ever on the day to day operations.

Interviewer: What would you say has been the most exciting event in your career?

Ted: That’s very difficult. Over the years, Scott, there’ve been a lot of exciting things that happened in the industry. [crosstalk 00:14:56] Sorry?

Interviewer: Tell me a few of them that they’re…they stick out in your mind.

Ted: It’s difficult.

Interviewer: What about when the equipment first…

Ted: Of course, when we installed the machinery, that’s always an exciting day, and when you kick it on and you see the product being made and so forth. Also, I was able to buy a rail operation. I also am an owner of a short line railroad. So I have involved myself in a lot of different areas.

Interviewer: Is the short line a necessity of the business or was it a hobby?

Ted: Well, no, not a hobby, it became a very vital part of our business. We were faced with the possible loss of a main means of shipping our product. And as luck would have it, we were able to acquire the rail property that afforded us a means to ship our product.

Interviewer: How long a track do you operate?

Ted: We operate 140 miles of track in the southern Tennessee, north Alabama area.

Interviewer: Wow. What would you say is perhaps the most interesting or what are some of the most interesting…?

Ted: And that acquisition, by the way, has opened up avenues of opportunity in a lot of different areas as well.

Interviewer: As far as scrap…

Ted: Well, as it goes with the scrap business and also some other businesses.

Interviewer: Are there anything, any particularly interesting moments that stand out in your mind?

Ted: Well, one of the saddest moments was the death of my associate and brother in law, Charles Danbo, in 1979. He had gone to Europe to visit the manufacturer of the shear that we had intended to buy. And while he was over there, he got sick and shortly thereafter he had problems that led to his death.

Interviewer: Do you have other family members in the business?

Ted: Yes, I do. My son, who was involved in the music business prior to 1979, joined the family business shortly after Charles’s death and has been with me ever since.

Interviewer: And is there another generation coming behind?

Ted: Well, my son has daughters, and I doubt one of those girls will want to be involved in the scrap business.

Interviewer: [Inaudible 00:18:12]

Ted: Well, I have a grandson who lives in South Carolina but his father’s a doctor, and he may have interest in another direction.

Interviewer: Have you had an opportunity to think of a succession plan?

Ted: Yes, it’s a thought which is with me every day.

Interviewer: But you’re still active day-to-day, every day.

Ted: Absolutely. Absolutely. Absolutely.

Interviewer: Let’s go back to ISRI, ISIS. Obviously we talked about your activity in the, teaching the shredder seminars. But you’ve been active on a lot of other levels, haven’t you?

Ted: Well, I look at being involved in your trade organization from a standpoint that I guess few people really do look at things. If you have an investment of sizable quantity in the family business and you have quite a few dollars tied up in it, it behooves you, I think, to be as knowledgeable and as interested in what happens with your livelihood as you can possibly be. I’ve seen people that have got a similar type situation as mine but they just don’t care. They just don’t get involved. You only get out of something what you put into it. And I have always felt that I need to give of myself and be involved and stay involved to be as knowledgeable as I possibly can. I think you do yourself, I think you do your employees a disservice by not being as informed as you possibly can be.

Interviewer: When did you first start to become active in either ISIS or ISRI?

Ted: Course at first in my early years, the 1950s, I don’t think that the ISIS was as organized or as well organized as it is today. The organization was in its infancy. Bill Story was the executive director. And from that time on, the stature of the industry began to grow to where it occupies a place of prominence today.

Interviewer: And you’ve been on the national board of directors?

Ted: I have been on the national board. Yes, sir. I’ve also been involved in all of the chapter chairs.

Interviewer: Would you go through that again?

Ted: Go through it again? No. In fact, I’ve just completed a tenure as a committee chairperson.

Interviewer: You mentioned the diversification into the rail business. Was there any other diversification that you found come out of your career?

Ted: No, no, no, not really. Well, of course, we’ve expanded the business into a more intense attempt at recovery of the materials that we process.

Interviewer: What do you see as the future of scrap processing?

Ted: I would say that the future of the scrap industry, of the scrap processing industry, is brighter today than it has ever been in the history of our industry as I could see it. The need for scrap as a melt ingredient in the electric arc furnace continues to grow to a point today where almost 50% of the melt is scrap. In the southeastern area of the United States, we have for years been a plus area of scrap. We’ve always had to seek markets in other areas. Today because of the river network, more and more EAFs are being located in the southeast. Also the closer markets have changed, transportation modes have changed, our accessibility to markets, all of these things have influenced the location of the electrics in the southeast area. So consequently, it enhances our marketing ability in our part of the country.

Interviewer: Do you think the VRI, HPI, or any of the other alternatives are a real threat to the scrap business?

Ted: No, they’re not a threat to the scrap business. They’re melting enhancements. And as the price of scrap goes, so will the price of the enhancements.

Interviewer: What about the other side? We talked and you may have alluded to it a few minutes ago, but what do you see with ASR? We’ve obviously looked at a number of different projects to recover plastics and rubber and so on out of ASR. Do you think that we’ll ever get to the point where we can do that?

Ted: I wouldn’t say never because I’ve seen too many things happen and evolve in this industry where people have said, “Oh, that would never happen.” Well, it has happened. I think we’re finding more ways, the technology is being developed to recover, recycle economically, almost all of the ASR. Personally, we are about to embark on a recovery operation whereby most people in the industry don’t realize how much of the ferrous and non-ferrous product they are throwing away.

Interviewer: Really?

Ted: That is correct.

Interviewer: Is this something that you developed?

Ted: No, it is just by assimilating the technology that has been developed and utilizing it to the best advantage. We have come to realize that there is a way to do this.

Interviewer: What’s your relationship been with equipment manufacturers over the years? Have you ever been involved in [Inaudible 00:25:52]?

Ted: The equipment manufacturers are greatly reliant on people in our industry. Over the years, I think the people that manufacture shredders will tell you that the way to build a shredder has been mainly the result of what scrap operation or scrap operators have told them. And we’re as knowledgeable or more knowledgeable about it than they are, strictly because we’re the people that live out there with the machinery on a day to day basis. And when we have a problem, then they have a problem. And the only way that they can correct it is by making something stronger or changing it or what have you. So consequently, we have been the so-called guinea pigs of the machinery and equipment facet or side of our business. And they have learned from us. They have greatly benefited from us.

Interviewer: I suspect so. We’re getting close to the time for the board meeting. Okay, we’re getting close. [Inaudible 00:27:12] If you could do it over again, would you?

Ted: Would I? I think so. The business has been good to me and my family. We have lived well. We occupy a good place in the community. And I feel like the service that the recycling industry does for the community is one of great need. And most people will not stop to realize that the recycling industry is a very, very vital part of this society that we live in. They just don’t stop to think that what the environment would look like if there were not people like ourselves. We just don’t get enough credit.

Interviewer: What advice do you have for your son that may continue in the business?

Ted: I would say that he needs to continue on the path that he is in. He is going to see many more changes and he will be responsible for many more changes. He is keen enough to be aware of the value and the recycling value of many of the things that we’re involved in as a means of return on the investment.

Interviewer: And if you had the opportunity to give others in the industry advice, would you have any personal advice to give them?

Ted: That’s a difficult one.

Interviewer: No trade secrets, huh?

Ted: No.

Interviewer: What about people who want to get in the recycling business? Would you encourage them to?

Ted: Unless they had a genuine feeling for being a recycler and were able to understand the vagaries of the recycling industry, and had enough of a technical background, you just cannot be a scrap person or a processor without being able to master quite a few fields. You’ve got to be a lawyer, you’ve got to be a metal person, you’ve got to be a salesperson, you’ve got to be a person that can handle people. You’ve got to know when to buy, when to sell, all of these things. I don’t think there’s a business that’s as challenging as the scrap industry. And it is a challenging, challenging business.

Interviewer: And a lot of hard work.

Ted: And a lot of hard work, right.

Interviewer: Long hours?

Ted: Sometimes. It doesn’t necessarily have to be long hours.

Interviewer: If you could look back and change things over the course of 46 years that you’ve been involved in, is there anything that stands out in mind that you would change?

Ted: Well, living in a rural area, I think I’ve got kind of the best of two environments. We live primarily in a small town but yet close enough to a metropolitan area that I’ve found that is a wonderful place to bring up my family, to rear my family. And I enjoy living where I am. And no, I don’t think I’d change the things. No.