Focus: Office furniture remanufacturing--Everything old is new again

Recycle, remanufacture, refurbish, reuse-these terms are used often by the office furniture industry, but they are frequently confused, misused, or intermingled.

In November 1998, the Business Products Industry Association's (BPIA) Office Furniture Recyclers Forum (OFRF), after discussions with the Environmental Protection Agency, sought to define recycling terminology to be consistent with the entire recycling industry. Thus, recycled office furniture is a term that is used for any post-consumer office furniture that has been diverted out of the solidwaste stream and back into the market, with or without repairs. From here, all other forms of office furniture recycling can be described.

Reused office furniture describes office furniture that has been returned to the market for sale without repair or improvement to its appearance. This type of furniture is often referred to as "used" or "as-is" and is bought at the buyer's discretion without warranty as to the condition.

The terms refurbished and remanufactured tended to cause some confusion among the office furniture industry and, until OFRF stepped in with their definitions, the two were often used interchangeably even though they are vastly different.

Refurbished office furniture describes recycled office furniture that has had value added to the product by being "touched-up" or cosmetically improved and then returned to the market for sale.

Remanufactured office furniture describes the process by which recycled office furniture is completely disassembled to its parts, inspected and cleaned, repaired or replaced, reassembled, and refinished to "like new" conditions before being returned to the market.

A GROWING MARKET

Remanufacturing as a whole has been around since the 1920s when, during the Depression, the automotive industry began remanufacturing as a way of reducing production costs. During World War II, with many natural resources going to the war effort, remanufacturing continued to prosper by providing recycled products as an economical alternative to new products.

Office furniture remanufacturing began to emerge during the early 80s. This can be attributed to many factors, including the downsizing of larger companies, increase of small businesses, increase in the public's environmental awareness, and the maturity of the market. According to a recent survey conducted by OFRF; the recycling of office furniture has grown to a $1.2 billion industry, representing an estimated nine percent of the $13.6 billion commercial furniture industry.

Companies like Haworth, Herman Miller, and Steelcase had manufactured office systems of such high quality that by the late 70s to early 80s, many pieces of office furniture were not "worn out" but simply "out of date," with colors and patterns that were no longer appealing to companies.

With a stable, usable framework, office furniture visionaries, many of whom worked with new office furniture, became enlightened to the opportunities presented them. A new industry had begun and continues today to change the way companies think and feel about their options when purchasing office furnishings.

"For many years, cubicles were in a state of upgrade, improving to the point at which changes became cosmetic, not structural. Thus, when companies moved or downsized, quality products became available in the aftermarket and, from an operational standpoint, served the purpose," said Susan McCloskey, chairperson of the OFRF and president of Office Plan, a St. Paul, MN-based new and remanufactured furniture company.

McCloskey, whose company Office Plan just celebrated its eighth year in business, noticed a slowdown in the sale of new office furniture and the need for more services including design and installation advice. Needing to maintain company assets, McCloskey started Office Plan primarily to provide design and installation services with procurement of office furniture when necessary. "We started remanufacturing office systems when needed, just small things at first," she said. "The company grew by fits and starts. Today, we have about 40 employees with 65 percent of sales being remanufactured furniture, 25 percent new furniture sales, and 10 percent design and installation services."

"We take a product that's built to last, and completely remanufacture it so that it has all the function of a new, but at a fraction of the cost," said Art Hasse, president of Kentwood Office Furniture, a Grand Rapids, Ml-based U.S. Office Products company which offers new and used office furniture systems, yet specializes in the remanufacture of office furnishings including panel systems and casegoods.

With showrooms in Grand Rapids and Detroit, Kentwood offers over 45,000 sq. ft. of new, used, and remanufactured products from hundreds of manufacturers.

"Kentwood also offers a unique range of options," said Hasse. "In addition to new products, we inventory large quantities of used furniture that we can sell as-is or custom remanufacture for a company. We can also remanufacture a client's existing furniture. Everything is done exactly to the customer's specifications; both in terms of meeting their budget requirements and creating the function and style they desire. All this, plus design service, efficient delivery and installation, and programs for rental and loaner furniture, and savings of up to 80 percent keep Kentwood in the forefront of the remanufacturing industry."

Eddy Edwards, president of Southern Office Systems located in Chattanooga, TN echoes the previous sentiments. "For twelve years, I managed a Steelcase dealership and saw a growing trend in remanufactured workstations."

In 1994, Edwards left the dealership to pursue this trend and started Southern. "The company has grown 25 percent a year since, with remanufactured systems constituting 95 percent of our sales."

STACKING UP THE BENEFITS

By replacing worn parts; repainting or relaminating cabinets and desks; and reupholstering panels and chairs, office furniture is given a new life. Existing corporations are able to have their old furniture remanufactured or remanufactured pieces coordinated with existing furniture to give their offices an updated appearance, which, as we all know, improves employee productivity and creativity. Startup companies that may not have been able to afford quality new furniture, can reap the benefits of remanufacturing with "like new" furnishings at a fraction of the cost. It is estimated that companies can save an average of 30 to 50 percent by buying recycled.

This is also a benefit to manufacturers of office systems whose products are being introduced to companies that could otherwise not afford new furnishings but, in the future, will remember the quality of their furniture and the company to go to when they need or want to buy new.

Remanufacturing is not only a costsaving alternative, but an environmentally friendly alternative. It is estimated that remanufacturing just 40 cubicles will divert one tractor-trailer load of furniture from a landfill.

"Environmental concerns are important to people," said Scott D. Parker, director of industry affairs for the Remanufactured Industries Council International (RICI), a nonprofit trade association charged with uniting and promoting the entire remanufacturing industry. "Often times, `green' products, while they may be the right thing to buy, may cost up to 20 percent more. We're talking about something here that is good for the environment, that usually costs less than a new product, and that performs like a new product. What more could you ask for? It's not a hard decision to make."

Due to the numerous lives it gives a products, remanufacturing also conserves natural resources. For each pound of new material used in remanufacturing, five to nine pounds of original materials are conserved. By diverting products and natural resources from the solid waste stream, landfill use is reduced and the lives of existing resources are extended.

"You don't have to be an environmental activist to appreciate what we do," said Chuck Sonntag, president and founder of RACE, Recycled Alternative Corporate Environments, a Boca Raton, FL-based remanufacturer of modular office furniture systems. "What's good for the environment can be good for business. "Founded in 1993, RACE offers complete project management services from design to final delivery and installation of recycled office furniture systems, including custom options and their exclusive RACE gable panel which is a top-angled panel that allows tall and short panels to be connected while maintaining an aesthetically pleasing panel flow.

"It's an incredible waste," said Sonntag. "People may throw out a complete office system just because the fabric is faded or out of date. Not only is it harmful to the environment and a drain on our natural resources, but it just doesn't make sound business sense."

TEN YEARS AND GOING STRONG

Celebrating its tenth anniversary, OFRF has grown by leaps and bounds to become the source for companies looking into remanufacturing. In 1990, OFRF held its inaugural conference with just over 300 attendees. "When we started out, we were kind of this small, fringe, entrepreneurial entity, and now we're part of a larger industrythe remanufacturing industry. Not only have we become more sophisticated as business people, but the organization has as well," stated McCloskey. "This year's conference is expected to bring 550 to 600 attendees."

The OFRF has not only gained members but has also gained support and recognition over the past several years. On September 21, 1998, the President signed Executive Order 13101, which promotes recycling by calling for mandatory procurement of selected environmentally preferred products in federal agencies. OFRF has continued to work with the EPA and the Office of the Environmental Federal Executive to include recycled/remanufactured office furniture in the government's federal recycling programs.

In October 1998, OFRF launched an aggressive awareness campaign, Recycled Office Furniture: Good for the Environment, Good for Your Business, to educate facility managers, design community, and consumers about the benefits of buying recycled office furniture. A brochure bearing the same name is now available.

As well, the OFRF has been actively pursuing an investment tax credit for remanufacturing equipment. A proposed bill won bipartisan sponsorship and is currently awaiting presentation to Congress. The bill will provide for a 20 percent investment tax credit for equipment used in metal recycling and remanufacturing.

Remanufacturing has proven itself to be a winner for manufacturers, remanufacturers, consumers, and the environment with growing acceptance and growing support to make it a real contender in the office furniture industry.

EDITOR'S NOTE: For information about BPIA's Office Furniture Remanufacturers Forum (OFRF) or OFRF's survey, call 703/549-9040, fax 703/6837552, or visit www.recyclefurn.org.

For information about the Remanufacturing Industries Council International call 703/968-2995, fax 703/968-2878 or visit www.rici.org.

Copyright B U S Publishing Group, Inc. Oct 1999
Provided by ProQuest Information and Learning Company. All rights Reserved