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Cleveland recycler adapts to battle margins

Keywords: Tags  scrap metal margins, Western Reserve Recycling, City Scrap Metal, Yehuda Perrenoud, recycling, Lisa Gordon

PITTSBURGH — Dynamics in the Cleveland market are motivating a recycler who operates in three states to keep growing and changing his business practices, he said.

Yehuda Perrenoud, the owner and managing director of Western Reserve Recycling, opened the company’s third Ohio location last year to increase volumes. The company now has businesses in Warrensville Heights, Collinwood and Cleveland.

"I opened the third Cleveland yard because I saw an opportunity and this location seemed wide open. You have no choice but to find and buy more pounds these days because the margins just aren’t there," Perrenoud, a 30-year veteran of the industry, told AMM.

Perrenoud also owns City Scrap Metal Inc., which has locations in Lee’s Summit, Mo., and Chicago, but said Cleveland is the one area where it is getting tougher to secure scrap.

"Margins have not become a big factor, but the only factor. Everything is going up—from utilities to fuel to insurance—so where you were making 20 cents you are now making 18 cents and need to make up the difference with more volume," he said.

"A scrapyard isn’t like Wal-Mart where you can raise prices. You can’t ask who you supply to pay you more money because everyone gets the same," Perrenoud added. "We never check the competitor’s price. We don’t care what others are paying because we know what we can pay and make a profit."

The operations serving Cleveland are within 20 minutes of each other but are convenient to customers on all sides of town. The locations are open Sundays and holidays to take advantage of competitor’s downtime.

"Sunday is one of our better days. We will do as much in four hours on Sunday as we would do in a full day during the week. We are located in hubs where there is a large peddler trade," Perrenoud said, adding that employees like the seven-day schedule. "Some of our employees would rather work on Sunday and have a day off during the week, and it was their idea to be open half days on holidays."

The recycler also bales, shears and has a small shredder used to process lighter metals.

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