September/October 1999
This Denver-based recycler overcame a devastating flood to become a leading nonferrous scrap processor. Its next challenge? Relocation.
By Kent Kiser
Kent Kiser is editor of Scrap.
Don Rosen was in a quandary.
It was 1965 and his scrap company—Atlas Iron & Metal Corp. (Denver)—had just been wiped out by a 9-foot wall of water from the flooded Platte River. He had to decide: Should he close forever, or should he reopen?
In truth, his choice was preordained. As he says, “After a while, you develop what you call rust in your blood. It’s a love for the business.”
So he decided to reopen.
And from its muddy ruins, Atlas made a remarkable comeback. Today, it lays claim to being the largest nonferrous scrap processor in the Rocky Mountain region, with particular strength in aluminum. Plus, its scope has broadened to include wire tolling, brokerage, new nonferrous metal sales, and new and usable steel sales.
So while the Platte River may have washed away Don Rosen’s physical plant, it obviously couldn’t wash away his scrap ambitions.
A History of Defining Moments
The Platte River flood was a major defining moment for Atlas, but it was only one of many in the firm’s history.
The first defining moment was its incorporation in 1956. That year, Don and his father Ben founded Atlas Iron & Metal Corp. on a 1-acre former coal yard near downtown Denver. They named the company Atlas “just to be first in the phone book,” Don laughs. “That was the old-timer’s way of thinking.”
In the beginning, the company was “nothing more than a glorified peddler,” handling “anything we could get our hands on,” he recalls. His formula for success was to find a niche. “We weren’t big enough to compete with some of the big boys in town,” he says. “So we had to do something the next guy wasn’t doing. We sold different items, prepared them differently for different consumption. For example, I think I was the first major stainless steel buyer in Denver.”
After the flood in 1965, the next defining moment came in 1971 when Art Medow joined Atlas as executive vice president and the company’s first nonfamily principal. Together, Don and Art took the company to the next level, especially by making it an early participant in aluminum recycling and brokerage. Part of that effort included Marvin Kippur, vice president and the firm’s second nonfamily principal, who helped Atlas develop the first UBC recycling program with supermarket chains. Around 1975, the company also diversified into new nonferrous metal sales, establishing Atlas Metal Sales.
By the late 1970s and early 1980s, Atlas found itself with a sizable brokerage business, including a trading office in Chicago. “We felt we could become an international player with brokerage at the time,” says Mike Rosen, Don’s son and the firm’s secretary/treasurer, who joined Atlas full-time in 1981. In addition, Atlas operated a scrap processing plant in Fairfield, Calif., owned half of Atlas Pacific Corp., a brass smelter in Carson, Calif., and held interests in two shredding plants in Salt Lake City. In short, the firm had become the new big boy in town.
But the company soon found itself up against stiff competition in the UBC market from aluminum producers and beer manufacturers. Around the same time, Atlas purchased a piece of industrial property with the intent to liquidate it, then found itself having to remediate the site’s environmental problems. These developments, coupled with cyclical lulls in the scrap business, prompted Atlas to “sit down and take a hard look at what we do best,” Mike recalls.
The firm decided that its forte was processing scrap, so it scaled back its brokerage operations, closed its Chicago trading office, and sold its interests in the other ventures. It then turned its attention back on its processing operations, first installing two Harris HRB balers, then adding a Triple/S Dynamics wire chopping system around 1991. “That was a huge defining moment,” Mike says.
The next pivotal period came around 1993 when Atlas, along with many other scrap companies, faced bank financing issues due to the recession at the time. The firm survived by tightening its belt and working closely with its banks. “Since then, our dependence on bank financing has dwindled to almost nothing,” Mike asserts, noting that “reassessing the company put us in best position we’ve ever been in.”
Today, Atlas has four operations in the Denver area, including its headquarters (site of its baling and wire chopping operations), Atlas Metal Sales, an aluminum melting operation, and Atlas Supply Division, a new and usable steel facility.
These operations process about 50,000 tons (or 100 million pounds) of scrap annually, encompassing 15,000 tons of ferrous, 2,500 tons of stainless steel, 30 million pounds of aluminum, 20 million pounds of copper and brass, and 5 million pounds of other nonferrous scrap.
Foundations of Success
Those figures beg the question: What has enabled Atlas to grow from a glorified peddler to a heavyweight in its region? One reason, Mike says, has been the company’s “ability to adapt, recognize changes in the industry, explore them, see if they make sense for us, and then make decisions.” One recent example was the consolidation fever that swept the scrap industry in the past four years. “We looked at the whole consolidation trend and where we wanted to be in it,” Mike says. Did Atlas want to be a buyer, a seller, or simply an observer? In the end, it chose to observe. “We were very pleased with our decision to sit back,” Mike says.
Another foundation of Atlas’s success is the pride its staff has in the scrap industry, Mike says, echoing the theme of past ReMA president Jim Fisher. “I think that’s really important to what we do here,” he notes. That pride translates into a love and excitement for the scrap business—the rust in one’s blood, as Don puts it.
But beyond its adaptability, beyond the pride thing, the linchpin of the firm’s success is its 105-person work force. Don, in fact, asserts that he’s “most proud of all the people who work here because without them this company wouldn’t be here.”
And the feeling is mutual—as you walk around the firm’s operations, its employees can’t seem to say enough good things about the Rosens and Atlas. For one, they praise the freedom they’re given to do their jobs and rise through the ranks. “There’s a lot of free rein, no holds barred,” says Jerry Simms, general manager of nonferrous metal sales. “The Rosens don’t micromanage. People are given freedom to conduct their positions. And if they do that work, there’s more to grow into.”
An important component of this freedom is the chance for employees to not only suggest new ideas but put them into practice. One example is the firm’s recent foray into recycling computer and electronics scrap, an idea suggested by Marvin Kippur. “This is an open-minded company that listens to its employees,” offers Bob Simms, vice president and the firm’s newest principal, who speaks from experience. “Don has always listened to my ideas and respected my opinions. What else can you ask for from an employer?”
How about a decent wage, bonuses, profit-sharing, and a 401(k) plan—all of which Atlas offers? It even has a staff workout gym in its headquarters. Perhaps most laudable, Atlas is a family business that allows nonfamily ownership. Of the five principals, only two are Rosen family members.
That shouldn’t be surprising because the Rosens view their entire staff as family. “We’re still a family business,” Mike says. “We try to involve ourselves with the individuals. It comes down to people caring about other people.” Don is perhaps the best example of this. As a “very social guy,” as Mike describes him, “he sits down on a daily basis with almost everyone in this office to talk about not only business but also personal issues. This is his family. It’s a concern that extends past the time you walk in to the time you leave. We share in each other’s lives.”
But you don’t have to take Mike’s word for it. Listen to Danney McReynolds, foreman of plant operations, who states, “What I like about Atlas is the family orientation.”
Or Jerry Simms, who says, “They’re very concerned with us as individuals and our families.”
It was precisely that concern that prompted Atlas to pursue an aggressive safety program in the early 1980s, following the death of one of its employees in a baler accident. “We take accidents very personally here,” Mike says. “We care what happens to each individual. I say to all our employees—come to work, be safe, and go home. That’s as important as anything to me on a personal level.”
Today, Mike talks with unbridled pride about the firm’s safety program, which includes safety and accident investigation committees, an early-return-to-work program, forklift training and lockout/tagout classes, hearing checks for wire chopping staff, and a safety incentive program. In that program, employees earn points every month they go without a lost-time accident, and they can earn bonuses quarterly and annually. At the end of the year, they can use these points to purchase merchandise or gift, grocery store, or donation certificates. Last year, the grand prize drawing for employees with 300 points was a trip for two to Las Vegas.
The success of Atlas’s safety program speaks for itself. The firm has gone as long as 750 days without a lost-time accident and its insurance premium is 75 percent lower than it was in 1992, Mike says.
Atlas’s company-as-family philosophy and concern for its employees has helped it build a loyal staff. How loyal? Aside from its five principals, the firm has 16 long-term employees, who have 283 years of combined service and personal track records ranging from nine to 26 years.
Providing Personal Service
How Atlas treats its employees is a close reflection of how it also treats its suppliers and consumers. “Our relationships with our customers are what we do best,” states Art Medow. Bob Simms couldn’t agree more. “You have to treat your suppliers like they’re number one. Our suppliers are our lifeblood.”
Atlas receives its scrap from three main sources (small peddlers, industrial accounts, and other scrap processors) and it knows what each supplier considers great service. “With our dealer network,” Mike explains, “they want to get a fair grading, a fair weight, get paid, and leave.” As Atlas delivers fast service, however, it tries to give suppliers personal service too, such as knowing their names, giving them a coffee or soda, talking with them if they have a moment, and answering their questions.
When it comes to industrial suppliers, “we try to understand that their scrap vendor isn’t the most important person in their lives,” Mike says. “Scrap is a secondary part of what they’re doing.” To him, the sign of success in this area comes down to this: “If they’re not thinking about their scrap, if it’s not an issue, then we’re doing our job.” Another Atlas strong point is that it pays its suppliers promptly, says Art, adding, “We have a very good reputation.”
The firm’s service focus gives Don grounds to boast, “In our 43 years, we’ve only lost one or two industrial accounts. We have industrial accounts that have been with us since we opened. We feel we treat our suppliers on a very decent level.”
Of course, Atlas applies the same service standards in its role as a supplier of scrap to its consumers. “It’s important that we put together a good, clean, solid package,” Jerry says, adding that what it comes down to is “we do what we say we’re going to do.”
Starting Over—Again
Atlas’s 7-acre headquarters sits in the shadow of an I-25 overpass. The firm has a history of sorts with that highway. In the 1930s, Ben Rosen opened a small scrap operation near downtown Denver. That first company was put out of business in the late 1940s, displaced by construction of the Valley Highway—later designated as I-25.
Ironically, Atlas now finds itself on the verge of being displaced again, this time by the encroaching redevelopment of downtown Denver. Whereas the firm used to be surrounded by industry and railyards, it’s now within blocks of the chic refurbished Lower Downtown (LoDo) area, an aquarium, and a university campus. From Atlas’s front curb, you can also see Mile High Stadium and a large, permanent amusement park. In short, it’s smack in the middle of the city’s commercial, residential, educational, and recreational center. And the plain fact is “we’re in an area where a scrap plant no longer fits,” Mike says.
So this is the company’s next defining moment—moving its operations out of the city and county of Denver. The big question is: Where will it move? At presstime, Atlas hadn’t found a site. The best Mike can say is it will likely be about 15 to 20 miles out and at least a 10-acre plot. The firm is having a tough time finding a suitable site, in part, because of the NIMBY syndrome. “It’s tough to find locales for scrap operations today,” Bob says. “For as much good as we do as a scrap recycling company, cities and municipalities still have a lot of stigmas.”
Though the Atlas staff is sad about leaving its “ancestral home,” as Mike calls its headquarters, they’re excited about starting afresh and creating their dream plant.
“I think it’ll be good for us,” Medow says. “It’ll give us a chance to plan, consolidate our operations, and become more efficient.” A big plus is the chance to design the new plant with environmental requirements in mind. That will enable Atlas “to offer our suppliers and consumers even greater assurances that their material will be handled in an environmentally sound way,” Mike notes.
Cause for Optimism
Though the location of its new home may be up in the air, Atlas has more down to earth plans for its future. “This company is strong now and will definitely continue to get stronger,” Don asserts.
For starters, the company plans to improve its baling and wire chopping equipment, Mike says. And it sees room for continued growth in Atlas Metal Sales. In recent years, Jerry Simms—a self-described “scrap guy” who spends equal time in new nonferrous sales—has helped grow this division from a local foundry sales business to more of a national and international service center. He did that in part through more aggressive marketing and advertising, establishing a Web site for the division, and expanding its product line to encompass more gauges and types of products as well as a larger inventory.
“By purchasing modern equipment that can cut specialty shapes and sizes, Atlas Metal Sales can hopefully continue to grow at double-digit levels,” he says.
Mike also predicts that Atlas “will become more active as a member of the larger business community in Denver.” As he explains, “Sometimes this industry puts blinders on. But the true innovators and leaders in this industry are those who are involved not only in the scrap community but their entire community.”
Some new business opportunities—and challenges—could also emerge from the ongoing shakeout of the consolidation trend, Mike says. In Jerry’s view, the consolidation juggernaut will roll again, though he hopes it doesn’t. Why? Because he believes “some of the industry’s unique qualities come from its family business nature. I’d like to see the majority of scrap businesses remain in family hands.”
As consolidation erodes the family structure of the business, it raises a troubling question, Mike says: “Where are we going to get the people to manage this industry?” With mergers and acquisitions allowing or forcing family business owners to exit the industry, “we’re losing that genetic feeding ground,” he states. “That family tree is being broken off.” This talent drain is more of an issue given today’s tight job market. And even if scrap companies recruit a new generation of employees, there’s the pressure of having to satisfy their need for growth and challenge. All processors, Mike says, “have to continue to be innovative in looking at the needs of employees in the long term.”
When talking about challenges to the scrap industry, you can’t overlook Superfund, of course—especially when Jerry is in the room. That’s because he’s a passionate crusader for Superfund reform.
It all started when Atlas, like so many other scrap companies, became a PRP at a Superfund battery site. That wake-up call lit a fire under Jerry and prompted Atlas to commit to fight as long as it takes to reform the law. “I’m committed to the very core of my being to seeing us win this,” Jerry pronounces. “Fighting Superfund is absolutely necessary if we are to survive as an industry and as an association.”
In the past 10 years, Jerry—on behalf of Atlas and the industry—has not only lobbied his own local, state, and national elected officials but assisted processors in other states. It has been a long, hard battle thus far, and it continues to rage.
“ISRI can’t fight the battle alone,” says Jerry, who serves as vice chairman of ISRI’s government affairs committee, a member of its storm water steering committee, and on its board of directors as nonferrous division director. To achieve reform, he says, the industry “must continue to build its grassroots lobbying strength and educate legislators about the industry.” Processors must get involved by writing or calling their representatives and taking them on tours of their operations, he says.
The alternative is to continue suffering under the misguided application of Superfund liability to scrap recycling transactions. As Jerry asserts, “These suits keep coming up and they’re going to just keep coming.” Though he’s confident the industry can achieve relief—“we have hope out there of winning on many fronts”—he adds realistically, “I’m not positive.”
In the end, however, Mike and the rest of the Atlas crew are optimists. Neither relocating nor consolidation nor Superfund will stop it from doing what it does best—processing scrap. As Mike says, “I’m a big believer that no crisis can shut this industry down. No matter what it is, it’ll just be another challenge we face.” •