Born Scrappy
The go-to podcast for scrap metal exporters and traders
Born Scrappy
Shaping the Future of Recycling with COO Tyler Adams
In this week’s episode I chat to Tyler Adams, COO of SA Recycling. Tyler was born scrappy and has emerged into one of the most forward-thinking leaders in our industry today. He started boots on the ground, degree in hand, and was given permission to fail. The way he thinks about leadership, culture, finance, and operations is steeped in intergenerational wisdom, deep personal experience, and a willingness to challenge the status quo.
In this episode, we talk about:
👉 Building in diversity and optionality
👉 Understanding your margins
👉 Where data meets gut feel
👉 Believing in your team
👉 Uncovering talent
👉 And much more!
Listen to the full episode. Wherever you stream your podcasts.
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The only marketplace and trade OS built for scrappies, by scrappies.
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WHO IS STU KAGAN ANYWAYS?
26 years in the metal recycling game and still learning and growing...
I learnt from the best and worked my way up from yard labourer to Executive Director of Trading and Operations for the largest metal recycler in sub-Saharan Africa. Responsible for 4,500 employees, 85 sites, and the overall profitability of a multi-billion dollar operation.
I brought my breadth and depth of knowledge to bear and co-founded the fastest growing, most-loved, and most awarded metal recycling company in New Zealand. No small feat in a country where people are outnumbered 4:1 by sheep (spoiler alert: sheep don’t produce much metal waste).
I thought it was time that tech worked for our industry, so I took all of my experience as an operator and trader and leveraged that to build THE killer scrap app, Buddy. That’s right - built for scrappies, by scrappies.
Father of two crazy-awesome boys. Husband to Lisa. Under 9 rugby coach. YPO member. Lifelong learner. Mentee. Mentor. Chief dog walker. Committed Stoic. Undefeated dance-off champion.
COME SAY HI ON LINKEDIN
Hi, I'm Stu Kagan and welcome to Born Scrappy, the podcast for scrap metal exporters and traders. Join me in conversation with some of the most experienced traders and operators that have helped shape this incredible industry. In today's episode, I chat with Tyler Adams, Tyler's, the COO of SA Recycling, the largest privately owned metal recycling company in the US with hundreds of yards throughout the country. Whether talking about culture or gross margin, Tyler is super knowledgeable and shares a lot of valuable insights with us. In today's episode, we talk about building in diversity and optionality, understanding your margins, where data meets gut feel, believing in your team, uncovering talent, and so much more. So let's get into it with Tyler, but first intro.
S4E7 Tyler Adams 01:Hey, Tyler. How are you? I'm doing great, Stu. How you doing today? Yeah, I'm doing awesome, man. It's a beautiful summer's day, even though we're not in summer, but that's what it feels like here in Texas. It's, uh, it's, it's a hot day, like usual. Every day is a hot here at the moment. I'm in Orange County, California, so, and similarly, it's a beautiful hot day, so certainly feels like summer. Yeah, yeah. Yeah. We're getting that. That's awesome. Tyler, we, um, you know, we've spoken for a while about getting this done and we've obviously had quite a few of the, um, the SA crew on before, including your dad. Um, I think this brings a different element now with kind of the next generation and. And the training that you've been on and the journey that you've been on. So really excited to delve into this, but I think a fun way here for us to start is probably to understand not, I guess, how did you get into the industry, right? I can imagine. But what that journey's been like right from the beginning. Like how did you get thrown into, what are the first few days and what does it look like since then? Yeah, absolutely. So I, um, I graduated college in 2008. I graduated from the University of Miami. And, um, I really had no idea what I was gonna be doing. Um, I decided I wanted to travel. I traveled for as long as I could about four or five months, uh, until I ran outta money. And at some point realized that, you know, obviously I had to work. Um, and so this would've been now the beginning of 2009. And I, I got home, started applying for jobs and so forth. Uh, actually got a job with State Farm Insurance and, uh, I spent a couple days walking neighborhoods in a suit and tie and realized that it was the most miserable experience of my life. And, uh, and so I called my dad. I said, look, I, I'd rather be welding and torch cutting in the yard than doing this. And so that's what I did. I, I started back at the company. I had worked summer jobs there. You know, obviously growing up and, you know, growing up that's just what we did in the summertime. You know, we worked at the yard, but, um, at that point, you know, I needed to learn the business through and through, you know, started running the scales, started running, uh, anything and everything that I could. So, mind you, at that time I didn't know what HMS was. So, uh, I still had a lot to learn despite the fact that, you know, I had been welding and torch cutting there for, for years. But obviously the. Financial crisis was full swing at that point. So, um, there was a lot going on. We had, uh, you know, recently formed SA Recycling, so there was, you know, a huge consolidation. You know, on our end there was a lot of growing pains and the markets were really challenging, so there was no shortage of work to be done and, and, you know, business improvement that really needed to be fixed. And so I just dove in and, uh. You know, I guess it's, it's in your blood and you get stuck to a magnet and I, I never left after that. Yeah. And, um, I mean, I've listened to your dad on stage quite a bit and I've had your dad, you know, on stage with me and we've spoken about things and he was, he talks quite a bit about, um, how you can now challenge him and the next generation has started to, to come and actually, and actually start challenging him, um, in, hadn't been before. Um, our data helps you win arguments, but maybe we'll jump into that a little bit later. You're now running a huge part of the company, um, the operations side. You run around between yards, um, all the time. I mean, you, you've got a massive team there. What, how would you describe your leadership approach and what would you say you've learned through that period? How to be a better leader? Yeah, I mean, I guess from a, a leadership approach in general, my teammate disagree with me oftentimes, but, um, I would say I'd, I'd like to consider myself calculated, so to speak, in, in terms of my approach, right? And, uh, it's easy to allow your emotions to run high, but at the end of the day, if you can understand the problem, understand all of the circumstances that led to that problem. I think you could be a much effective problem solver and a, a more effective leader if you can be a bit more tactful and, and tactful in that approach, in, in solving that problem. So understanding both sides of the story, understanding all the circumstances that got you there, I think allow you to make better decisions rather than trying to make, um, you know, a rash or quick decision. You don't always have that luxury, right? We we're always making decisions every single day, but to the extent that you can be. Again, more calculated in that approach, I think you can be much more effective. So that's always my goal. That's what I strive to be anyways. Yeah, and I think it's, it's probably hard. Um, it's really hard, and I've seen it before when you, you know, when you, you're a part of the family and having to come in and lead, um, from the front, um, it, it is hard. And you t is probably a great way, um, to be in that position because, like you say, emotions. Um, play a real part and when you are younger as well, ego plays a real part as well. So that, that being tactical is probably, um, the best way to handle it. When you're a younger part of the family, um, coming through, what would you say, um, I guess if there was a pivotal moment, if there was one, you know, memory that you have that shaped your leadership style that you were like, you know, this is how I need to be as a better leader. Can you think of an experience when that happened? Yeah, it was probably, that's a tough one. I, I'd say back in the 2011 range, somewhere in that ballpark, um, we had a, a yard actually in Los Angeles that was really struggling and you know, it's a phenomenal yard, has incredible potential, but it was dying, right? There just was no business coming in. And at the time I just had visited it and I asked. Very specifically, if I could just move my office there. Now, mind you, this is in downtown LA and, uh, it was a very long commute. It was about an hour and a half each way. This is not a fun commute by any means, but I, I was so passionate about what I thought the yard's potential was that I asked just to. At the time I wasn't qualified to be a manager by any means, but, um, you know, I was still learning the business and, and working my way up through the ranks and, and trying to earn, I guess a niche within the business. And, um, and so, you know, I moved my office there and within a short period of time, you know, a couple months, we had doubled the volume and, you know, we had really made significant strides in improving that. Business and it was really more of a, you know, let me see what I can do and let me prove to you that I can make, you know, a significant impact in this business. And at the time, again, everyone said, you know, well, whether you're too young or you're too inexperienced, or, or you're still learning, or whatever the case is, you know, at some point you need to be able to dive in and, um, and you need to have. You know, the permission to fail. Right. And, um, and I was fortunate enough to be given that. And um, and I've obviously kept that with me, you know, for a long period of time.'cause oftentimes we have so many people within any organization that oftentimes get overlooked or have never been given that authority, or have never been given an opportunity to truly show what they can do. And the, the deeper you look within any organization, the more talent, you know, I, we've proven that we. Uh, you know, you said permission to fail. I mean, that is something that is so key in a leadership style. Like if you, if you can give your team permission to fail, um, that's hugely valuable because if they're not gonna fail or if they're too hesitant to try something, because of the repercussions of failing, you can't expect to grow. Because, you know, ideation and, you know, um, coming up with new anything, new ways of doing things, you need to have the ability to actually get it wrong. Otherwise you'll have people doing the same way that they've always done it. And our industry has often got this mentality of, well, we do it that way because that's the way it's always been done. I mean, I remember when my wife joined the industry, um, with me and when she was first looking at our technology, like our tech stack, and she's like, why do you do it like this? I was like, well, that's how it's been done. She's like, well, we can't operate like that anymore. And she brought Salesforce in and data warehouses and it was just like a massively beneficial way of doing things. But that was because we didn't look at. What your father has like kind of advice he gave you, whether during that time or before the advice. You know, he's probably, most people have heard his read his book. Um, and, and I probably heard every story in that book, you know, hundreds, hundreds of times. I think the most relevant and applicable lesson I think in, in the entire book, and something that is not only. Been applied in my professional career, but also in my personal life and my family life is, you know, you always take the high road and there's not really a decision that's ever made where there's not an option to take a. Higher road, right? And, um, that's something that he's been very passionate about forever and, uh, something that, you know, I've always tried to maintain as well. And again, it, it doesn't really matter what decision you're making, whether you're dealing with an employee or a customer, um, maybe someone that's disgruntled, um, maybe you're parenting or maybe you are, um, dealing with other, you know, personal and family issues. Uh, taking the high road, always. Ought to be the priority. And, um, and it, we've proven time and time again that taking the high road, it may cost you money. It's not always the cheapest road. Right. In fact, it's probably rarely the cheapest road. Mm-hmm. But it pays dividends. And those dividends may take time to, to sprout or to bloom or to, to show themselves. But in the long run, they, they almost certainly will pay dividends. And we've seen that. I think, uh, we try to preach that with, you know, our entire team. And in every aspect of our business, we're always trying to strive to take that high road. I think it's about values, right? Like if you have instilled that in your team, that I'll never forget, my wife had written up on our whiteboard the one time when they go low, we go high. Um, and if you've instilled that in your team where it's just like. We will always make the right decision, as in what's the right thing to do. You don't get caught out where you've done something unscrupulous or something that you shouldn't have done where it lands you up in hot water. Like if it's always higher road, it's always the better option. And like you said, it's usually the more expensive option. When you're talking about it, it's normally about, this doesn't make business sense. Yeah. But it fits in our values. Like that's the right thing to do right now, even though it's gonna cost more money. Yeah. And you know, in this industry, right, your reputation is everything. Yeah. And you know, it's really quick, it's really easy to de to destroy your reputation fairly quickly. And so we try hard to maintain that. And I try personally, you know, very hard to maintain that. Yeah. You know, I'll, I'll touch again on your dad's dynamic and I'm a data guy, obviously in the tech world. So your dad, you know, was talking about how, um, you are able, he mentioned you specifically are able to now argue with him in front of, you know, the board, whoever it might be, and you use data now to be able to make a better decision or, um, you know, make data driven decisions. And it's hard, um, for him to compete with gut feel. Our industry has always been about gut feel. Slowly. The next generation seems to be changing it. Uh, more to dr to, to data-driven decisions. How, I guess what sparked your interest in, in a data-driven approach? And then also like how do you get buy-in from an old school mentality? And here I'm not just talking about your data, I'm talking about the industry. You'll have a lot of other executives, a lot of other people in the team that you're having to take on that journey too. So I, I guess in terms of what sparked it, I mean, I'm a, I'm a finance major. I, you know, I studied finance in school and so when I started, again, going back into oh nine, you know, we had maybe at the time 35 or or 40. 40 some odd yards or so, but when, when you have a lot of problems, you don't necessarily know how to focus your efforts on solving those problems, right? So I started first with trying to build out models and, and analyze the business and say, okay, here's our, here's our top five areas where we need to fix them the most, right? And, and so by doing that now you can zero in on your problems and, and it comes down to prioritizing. The problems that, that are most easily, um, fixed, so to speak, the, the low hanging fruit. And so I think my whole focus has been, you know, and the larger the company has grown, the, the more critical that is Now, um, you know, you, you always try to minimize the number of problems that you have, but by using the data and information at your fingertips, you can now focus and prioritize your efforts. On the easiest and most beneficial, uh, solutions, so to speak, in terms of solving those problems. So that's kind of always been my focus. I think every system that we install or every report that we build, uh, any bit of information or data that we analyze, it's really. That's the heart of it, right? Is you, you have to get to a way where you don't suffer from this information overload. You, you need to be able to look at something and have it slap you in the face and say, okay, here's my, my most critical problem that needs to be solved at, at any given time. And that, I think allows you to, to, to focus on it, right? Um, you know, data doesn't lie, um, unless you have garbage in. And, uh, and so obviously the integrity of the data is. Critical, almost any data set also has a, a, a various number of assumptions that you, you may also need to make during those. And if you have bad assumptions, well then it will skew your data as well. And so, and I think that's where this really, the gut instinct comes back into play. And, and, you know, you're never gonna replace your gut. You need to still be willing to follow your gut, but I think your gut should also be supported and documented by, you know, uh. Information. Right? And data and, and we have tremendous amount of data. So the more data you have, the more hopefully analysis you can do to support your gut. And if those two are conflicting, there ought to be an explanation as to why. And so, you know, myself, my father, my brothers, we don't necessarily always agree, but typically there ought to be a solution within everyone's gut instincts. And then the data set that could point you to. Maybe a more logical explanation or a decision that can be made, so where you can reach consensus amongst the group using that information. Right. And I think that's kind of always been my approach. And uh, again, as I've grown up within the business, you know, I could speak my opinion, but my opinion didn't necessarily carry the experience that a lot of other people's opinions had. Right. So I would have to support it and back it up with, you know. Analysis and data, right? And so we highly encourage that amongst our team. So, yeah. How did you, how did you get the buy-in, like from an old school industry was surrounded by people that have haven't used data before. Did you find that easy? Was that tough? Or was it when you were able to prove things out, they were like, okay, this makes a bit of sense? Yeah, I think at the end of the day, the results don't lie, you know? And so if you can. Say, formulate a hypothesis based on a data set, and you believe that that's gonna lead to a certain conclusion, and then you can go deliver on that and prove the results, right? Well, now your data and your analysis start to gain consistency and or, or legitimacy, right? And obviously that takes time and, uh, and you, and you don't always achieve the results that, that you have, but. There's also variables that, that can impact that, right? Mm-hmm. And again, if those are explainable or there's other circumstances that contributed to maybe the, the lack of success or, or the lack of accomplishing what your, your hypothesis or conclusion was, was trying to get to. Well, okay. So that's fine, right? But again, I think in, in, you know, especially I think in our industry, there's a lot of folks that are gonna be hesitant to certain metrics or certain data. And, and at the end of the day, um, you. You need to be willing to adopt or die. Right? And, um, and so it's kind of like one of those things where, you know, the people that are using the information as they start to excel and, and succeed and surpass the people that are maybe unwilling to listen or unwilling to adopt it, well then they ultimately get surpassed. Right? And, uh, and, and so nobody wants to be left behind. Yeah. I always talk about my parents, like when the internet came out, right? Like you could have been those people who just were like, well, nah, this is a fad, or I'm not interested. Um, and be left behind. Or you could have been those ones who jumped in and got so heavily involved in it, um, you know, and got to ride the wave. I guess that probably could lead us into, you know, an AI conversation. But before that, I just wanna ask you, what is the data points? Um, monitor. Certain, um, aspects of your operations? I think probably the, one of the more difficult metrics and, but also the most beneficial metrics in my opinion, is just. Understanding margins, right? And your material margins are, you know, in my opinion, one of the the most beneficial things that you can study. And if you can get to a point where you can understand your margins at any given day, and truly follow and track your buy price against your sale price and what happens to those commodities as they move through your inventory. You can be a much more proactive and successful business leader. And so, so much of our analysis and data and reporting is all on material margin. Right. And, um, you know, we spend about, you know,$3 on cost of goods to every dollar we spend running the yards, right? So, so you have a three full dollar spend on cost of material versus the amount of money you spend on your operating expenses and your sg a and, and your labor, et cetera. So, so from that perspective, right? You can drive much greater profits to your bottom line by better understanding your margins. Then you can by shaving, you know, dollars here or, or watching over time. And, and all those things are important, right? But I, I would argue they're much easier to monitor and much easier to regulate than truly understanding what your material margin is. And so we're, we're, we're really focused on that. I love margin, um, and as many people in this industry do, you know, so I'd say that's probably one of the metrics we focus the most on. Tyler, it's quite interesting'cause you love margins and you said, uh, most people do. I think most people focus more on operations. I really do. I'm a commercial guy myself. I. Maximizing your sales price, buying for as cheap as possible, wherever you can, upgrading as much as you possibly can, looking for those opportunities, um, wherever possible like that. That's been much more my side of my growth and where I always participated. Um. I find most people in the industry will focus on the one or$2 that they can save on, you know, whether it's downtime, which is of course, as you said, whether it's staffing, which is absolutely important, like you can't take away from that. But I agree with you that you got more value add, focusing on your buy price or your sell price in that margin. Then you do, you know, whether you, you cut someone's hours or you reduce your, your staffing, you know, by one or two people in a yard. Yeah, absolutely not. Right? It requires discipline, it requires managing and, and monitoring and, and so forth and, and teaching and coaching, right? I mean, it requires all those things, but also it's not, you know, material margin isn't necessarily half only margin for unit measure. Right? And, and a lot of people think that, okay, well I need X amount of, you know, material margin per unit measure. Well, that's actually not necessarily what, what I'm specifically referring to. It's actually. Total margin, right? And, and it's always a function of volume times margin is gonna equal your total material margin, right? And so there are times where that extra actual volume is gonna contribute to a greater material margin than you would've generated otherwise, and vice versa, right? So, um, that. Where those two things inter intersect, right? Volume and margin. You'll have a, an optimization or a maximization of your material margin. And, and that's really I think the, the focus and, and what we try to preach in, in many cases you're talking, um, what I would call gross profit, which is like exactly curb branch. The difference between. And revenue and that total number. And then when you equate that back divided by pounds of tons, you start to get your, your margin per per pound. So you're, you're specifically talking to the gross profit, which I mean absolutely. Because to an extent, all of your opex and all your costs are fixed. Yeah, of course there are variables which you can monitor. What does fluctuate, depending on the market, depending on how well you're selling, depending on how well you buying in a month and, and processing as well, is your gross profit. Um, and that if you are maximizing your gross profit, I mean, I still believe you're maximizing your Yep, absolutely. Yeah. So can you think of any time that, uh, there's been any data that you guys made a wrong decision? We were relying on data and it was kind of like overruling the gut feel and you were like, no, let's go with this. And maybe it wasn't the right decision. You know, I, I don't know. Probably not specifically off the top of my head. I, I would say that where. I think most mistakes have probably been made, and this is along the same vein of a lot of what we just talked about, right? You can't overcomplicate our business, right? And so you could study the yield on. Car bodies or what you're putting into your shredder, you can, you can study it six ways from Sunday and you may get four different yield results on the same type of generic feedstock. And you may look at that and say, well, I think this is what it cost me to shred and this is what it cost me to do X, Y, and Z. And so I can't afford to pay more than Y. Right. And. So, so new, you make a decision based off that, but in the end of the day, you start losing tremendous amount of market share. Or maybe you start gaining market share because, you know, so I think in most cases the, the, probably the mistakes that get made are when you try to overanalyze what you would expect your margins are going to be, but recognizing that there's too many variables to, to, I guess, overthink it. And that sounds counterintuitive to what I just said because I said we study our margins, you know, extensively, but you know, over time you can get a generic. Understanding of what your overall margins and yields are going to be. And um, but you also just can't overthink it, right? And I think that's where your gut needs to kick in and say, no, like I can see the material, I can see the yields, and this is what I have to pay. And maybe it's short term or, or whatever. Um, but. I'd say that's probably most of the, the, what I would say, maybe the data brings you astray. Um, outside of that, it's gonna be, you know, maybe on the m and a front. And, and not every, you know, acquisition is going to yield the, the greatest results. Um, and at some point you gotta take risks, right? And you could try to analyze a business and an analyze the synergies and, and, you know, the, the net impact that that business is gonna bring by incorporating it into your portfolio. But. Oftentimes things don't always work that way because again, there's too many variables, right? There's a lot of variables that will come into play. And, uh, so that, that'd probably be the other types of examples. You, you spoke about m and a, right? And, and you guys have, um, had your fair share of, of m and a. I mean, I remember when your dad was on stage, the. In the beginning I was like, so how many yards do you currently have? And he threw out a number and at the end I was like, and now how many yards do you have? Right? It was an hour later and I just wanted to check how much it had gone up by, but, so you guys have had your fair share of, of, of, um, acquisitions. What is it, if you could kind of like look at some of those businesses? So, for example, if you weren't buying it, right, so now we've got some listeners that are running a medium sized metal recycling. What is the advice, like you would say to them, like, you guys should start doing X because, you know, we've tried this and it's worked. Um, what are those sort of advice, whether it's data driven or not, where would you say that these, these guys could get better? I think a lot of times companies get stuck in, in. I don't wanna call it micromanaging, but they're so used to controlling every aspect of the business. Right. And, and a lot of companies, it's just, it goes back to, well, this is the way it's always done, or maybe this is the way their father did it, or This is the way, you know, et cetera. They sign every check, they authorize every payment. They, you know, they open the yard, they close the yard. They, they feel like they need to, to control too many aspects of the business. You can't be out hunting, right, if you're too busy protecting the chicken Co, so to speak. Right? And so I think too often I see in the, in the advice I always have is, is believe in the team that you have. We talked about it earlier, you know, the permission to fail, trust the team and give them the authority to make decisions and take some of that decision making off your plate, right? And what you'll do is you'll create better, longer term, longer lasting and tenured employees. Uh. That will grow with you and that will allow you to further grow as well. Right? And, and that that doesn't necessarily mean growing in the number of sites that you, that you have. Uh, it could be volume, it could be growing your operations just in general. Um, you know, to me that is always one of the, the best things. You almost need to work yourself out of a job by giving your employees the more authority and trust to make those decisions so that you can then. Expand your role and expand what you are doing within, within your business unit. Right. And it doesn't just apply to an owner, it applies to, to various managers and various people within any type of organization. And yeah, I think that's, I think too often people are afraid to relinquish their responsibilities because it gives them a sense of security and job security and, and, um, but you can't go anywhere if, if you don't have somebody to take over your responsibility. Right. Yeah. I mean, I remember we used to always say delegate and elevate. It's like if you can be, you know, giving other people roles, you can be doing so much more working on the business and, um, making better decisions instead of being in the weeds and making decisions that aren't gonna move the dial. Right, like making a decision of um, you know, whether it's signing each check or making a decision of what grade to call those few pounds that came in.'cause you like to sometimes be on the front scale, like compared to making bigger decisions of like, who's my next big hire? Or, you know, are we hiring, are we looking for growth? If we in sales team, you know, are we bringing in certain techno? Like those decisions move. But the smaller decision you should be able to delegate. I couldn't agree more with that. Um, what big changes have you seen in the last decade? I mean, you've been doing this now for a while. What did you see that people didn't necessarily see coming? And then what do you think the next five to 10 years could look like? Because, you know, nobody knows what it's gonna look like, but hopefully we can learn from the last 10 and, and kind of, um, hypothesize what the next 10 might. Let's see. So if I rewind 10 years, um, would've been 2015. And, um, you know, around that time, I guess one of the probably largest differences I see in the market today versus what I saw 10 years ago is if you think back, how dependent we were on, especially from a non FARs perspective on China as a consuming nation of non FARs. Right. And to me, I think one of the most dramatic shifts we've seen in much of our business is just involves China. Right? And, and, and maybe that's not surprising to everybody, but, um, but again, I, I can remember trading. Copper and brass and a bunch of commodities through 2016, 17, and, and really up until, I guess it was about halfway through 2018 when, whether it was the iron sword or the, you know, whichever initiative that they put out and started cutting out and, and eliminating waste going into China. I mean, that was a, a massive shift in, in I guess the global. Trading dynamic from a recycled materials perspective, right? Mm-hmm. And, um, you know, not many of our commodities today, well, especially today, and that's been exceptionally tumultuous couple weeks. And, and not to get into the tariff train, um, but my point is that I think that that was a, a shift that. Really was, I don't know, that everybody saw coming. And that dramatically changed the landscape into how we all do business. Right. Uh, you saw more copper choppers starting popping up in the United States. You saw a lot of materials starting to stay domestically. People needed to create cleaner products. They, they couldn't get into China. Um, yep. You know, the, the movement of Zorba, right. Um, shifting away from. What was predominantly used to be Chinese consumption to, you know, the, the number of countries today that are buying Zorba. You didn't see that 10 years ago. And so I think that's been probably one of the biggest shifts that I've seen. Obviously there's been a lot of changes, but I don't know that many of the changes we've seen over the last, you know, the, the balance of the last decade have been that surprising per se. What does the next 10 look like? Next 10? Oh, man, that's a good question. I don't know. Probably, um, um. Look, I, I know, um, there's certainly a lot of technology being, you know, thrown at the industry. Um, a lot of software being developed as, as clearly you're a part of. Um, and so, you know, I think we'll continue to see the industry get smarter, um, you know, more effective and, and efficient. Um, but I, I don't. Know that I have a, a, a crystal ball per se, that's gonna say that this is what I would expect that, that, that shift looks like. Um, you know, certainly we're seeing a higher likelihood of, of more and more domestic consumption. We're seeing a lot of the large companies really trying to position themselves for. A, a much more domestically oriented business. So I, I think that shift will continue. Um, again, in light of the tariffs and the trade wars, everything else that's going on, certainly that seems like an obvious outcome. Um, and then it's just a function of, you know, positioning yourselves to, to capitalize on that. How far can we go with ai, like AI's come into the industry slowly, not everybody's using it. Um, how far can it take us in middle recycling? You know, that's a great question. I, I won't pretend to be an AI expert, but I certainly would suspect that there's probably, I, I guess when I think about ai, I kind of think about it in, in probably two, two separate buckets. Um, you know, we've seen and tested certain types of AI really focused on material identification and, you know, using, uh. Using it to identify recoveries, grade material. Um, and, you know, some of that's used from a compliance standpoint, right? To whether you're, you're using it to analyze your scale buying to make sure that you don't have fraudulent transactions, um, using it to make sure that people aren't overpaying or over grading for certain types of material. Um, you know, the question is, is how accurate will that become and, you know, how effective will it be? Certainly in the long run, I would expect it's gonna be. Pretty efficient. Um, the other bucket I'd say is, is more using AI from a sense of managing your information and, and minimizing information overload. Um, you know, we're collecting hundreds of thousands of millions, if not, you know, pieces of information every single day. Where do you start with looking at it? Right. And um, and kind of this comes back to a scalability standpoint and, and everything I look at, I try to look at it, making sure that it's. Scalable to our, to our business model. Um, and trying to manage, you know, the size and scale of a business requires the effective interpretation of data and information. Um, and again, this is kind of along the lines of much of what we've already talked about, but I, I think there's an opportunity to use AI to better interpret and digest the mass quantities of information. That rather than looking at a, you know, a couple hundred data points on your screen, you have more obvious issues, right? And, and identifying the problems that you know will spark an inquiry into a certain problem, right? So if I'm looking at 150 yards and their average by prices on a daily basis. I think there's an opportunity to say, Hey, focus on this one. It's up$12 day over day or month over month than, you know, than, and don't worry about the rest. Right. And I think that there's probably much more on the, on that, on the analytical side. I think the value there is huge. Like I think what you spoke about, you know, like data dams and where you've got this huge amount of data. It's just, it's actually impossible for us to analyze all that data ourselves. So to use AI for that is hugely important and AI's only gonna get better. And you know, when you talk about, um, grading your material and looking for anomalies on the front scales and things like that, and that's, it's only gonna get better with that. But then that's also going to start giving you data. It needs to use data. And it's like, well now I've got more data to look at. Like now what? Right. So it's actually the ability to, um, review the data and bring you findings and say, based on the data in the last week, you have an issue. You should look further into that yard, which is up$12. Here's the data behind it, because this is what we've been able to find. Like, like that's what you need things brought to you. And I do believe that AI can already do most of that. It's really getting it, um, in our industry and to be trained in our industry to understand what the things are that it's looking for. And I think that level over time, um, it's, it's not easy because, you know, we are a niche industry and technologists come into the industry and see a huge opportunity because it's in recycling and easy to raise money in recycling and opportunity. Because they don't necessarily understand the space. It's really difficult to get people in tech to build the right technology for our industry, but we'll get there, there's no doubt. What about, um, if you were to start a, a metal recycling company right now from scratch, you left essay and you started something yourself, what would you do differently to what you see out there? You know, I, I don't know that I wouldn't. Certainly what I would do is not gonna be anything profound that other people aren't doing, but what I would make sure in any type of business that I was starting had a, a high level of what I'll call diversity and, and optionality. I. And I think that's something that's critical to anybody in this space, right, is you can't have all your eggs in one basket. Um, there's gonna be months where recycling cars could be exceptionally profitable and it could be exceptionally difficult. The same is true for copper or aluminum, uh, or anything. And so we, we try hard to focus on. In that diversity, and again, in light of what I'll consider certain trade shifts, you need optionality in being able to maximize. The options in which you can leverage and, and sell your material, right? If you're captive, um, to a consumer or to a home, right? You're gonna be much more limited in, in your ability to, to be able to market your material. So I think those are, are the two key focus points. Um, you know, we see even within our portfolio, we have markets where we're more challenged to get material to market. And whenever you're more challenged, you don't have. The same level of competitive advantages to markets where you have that optionality. And so I think that's a, a key focus I'd have. Yeah, and I think it, what's important is you never know what tomorrow brings right. With you exactly what you just said. So you might have one great home, you know, in Vietnam for certain commodity. Tomorrow Vietnam puts on tariffs. And you have no home. All of a sudden you're scrambling and you're in a big amount of trouble. It's pretty much why we went out and built Buddy, which was the idea was to be in as many countries and give you the main as many options as possible. Um, so it's exactly that. I, I totally agree. I think to be starting a company or you have a company to have as many options as possible, as many homes, you don't need to be going to them all the time, but just have them available to you and have those relationships. You can reach out to, because then you don't get stuck in that position where there's no revenue coming in. Right. And that's what, that's you, we talk about gross profit, you know, um, if there's no revenue coming in, you don't have a business. Absolutely. Having those homes is absolutely important. Once, one piece of advice you would give the next generation of scrap, I basically already said it. Right. I think it just has to do with building out your team, trusting your team, and, and. Growing them with you. Right. And I think that's, that's probably the, the best thing that I believe anyone can do in this space, right? Mm-hmm. Because, um, you know, I'm, I'm exceptionally proud of the team that we have and the, and the team that we've built. And I think that's single-handedly the greatest contributor to, you know, our success is that, you know, we have a great team and I. I don't make decisions for them. Um, they make the decisions. I'm, I like to think of myself oftentimes as a bit more of a consultant. I'm happy to give my opinion and, and shed my, you know, advice on, on the direction and the things that they should be doing. Um, but we try very hard to keep that entrepreneurial level delegated out to our, you know, our, our business units and our, and our managers. And so, um, you know, I think that's, I think that's key. There's lot of in that like, it's not so easy. I had 85 yards, um, reporting to me once and it's extremely difficult to have that trust. I can't say that I was perfect at that. I micromanaged a lot. Um, but I do agree with that though. Like I found it hard. But it doesn't mean I don't agree with it. Like I believe that, yeah, if you can have that entrepreneurial spirit and people feel that they're doing this as a part of something greater than them, but but for themselves at the same time, um, I think you'll have, you'll have great success. It's a great bit of advice. If you could wave a magic wand and solve one industry-wide problem right now, one problem that the whole industry is suffering with, what would that be? I think without a doubt it's, it's fires, right? I mean, I think it's single-handedly one of the greatest threats that our industry faces. Um, it's only getting worse and they're inevitable, right? And it just comes down to, you know, how quickly can you put a fire out and how much fuel does that fire have to burn? And if there's no fuel to burn, you can put it out pretty quickly. And so, you know, that's, that's pile management, inventory management, um, getting your, your yards down to the ground every day. It doesn't have to be just shredding facilities, but, um, again, I, I firmly believe it's one of the largest vulnerabilities of our industry. Uh, I was watching the news this morning, you know, large scrap yard on fire this morning, and, um, mm-hmm. And it's gut wrenching to watch, even though it's, you know, thank God it's not one of my facilities, but it's painful for the industry, right? And, uh, and it's a large reason to, you know, why we struggle to operate in many jurisdictions that, that we all operate today. We're not necessarily viewed as a positive contributor to, you know, our communities. And, you know, when our facilities are going up in flames, it's, it's not necessarily difficult to see why. So, yeah, you know, I think that's the single handed, you know, biggest problem I think we all need to solve, and certainly one I'd love to see go away. But yeah, look, the amount of batteries coming in as, as there's been, you know, a lot of topics and discussion on this and, and, but they're only increasing, the fires are only gonna become more frequent and, um. And it's, it's up to us to be prepared to fight them when they start at their inception rather than, you know, thinking that, you know, you, you've got source control handled and that you're not gonna have a fire because you're doing source control, because that's never gonna work. There's much more to it. Absolutely. Yeah. Well, let's, hopefully we get there somehow. I'm not sure how, um, I'm sure there's people smarter than me out there trying work on. Huge problem industry. Who would you like to hear next on Born Scrappy? I don't know. Good question. Um, my first good question of the day. No, no, not at all. Oh, I think, I think you should chase, uh, Doug Crawford with a Okay. I think that'd be a, I think that'd be a good one. Don't tell him don't, he's gonna hate me. Don't, don't tell him I, I dunno if he's ever been on, but I was thinking about it. You know, I, it'd be a good one. Yeah. Yeah. Yeah. I think it's a good one too. Yeah. I'll reach out to him shortly. I'll say Tyler. Tyler, that one. Cut that one out of the final version. All right. Yeah, yeah, yeah. They'll never know. Alright, so we always end with, um, getting to know you a little bit better. So it's the quick fire round at the end just to get to know Tyler himself. Um, what's your favorite TV show or movie? Uh, I'd have to go with the Yellowstone, you know, that I haven't. Well, and, and the 1923 and the 1883. The entirety of the series, I'd say is probably my favorite. I haven't done it, and there's a reason I know I'm going to try binge watch it when I do, and it's gonna suck up so much of my time because there's so much to catch up on. I keep saying, my wife's like, let's do it. It's like, let's, I'm like, I can't because I'm gonna watch like back to back to back. And apparently it is so good that I'm just gonna get sucked into it. So, uh, I dunno, I'll find some time on a holiday, so I'll just sit in the binge. There you go. Um, favorite, uh, place to visit Big Lake, Oregon. That's a camping spot we've been going to every summer for, since I was born, so Big Lake Oregon. Big Oregon. Yep. Nice. It's not a big lake. It's actually a relatively small lake and, uh, there's nothing there, but, you know, campsites and, uh, but yeah, that's our, that's our annual summer vacation, and so it's like, wouldn't any other place when you call that really big guy, when you call him tiny. Is that like big leg? Not actually. Exactly. It's just a Exactly. It should just become so, um, do, I don't know how much you read, but have you got a favorite book? Atlas Shrugged. Atlas Shrugged. Beautiful. Good call. Yeah. And haven't read in a long time, but de definitely my favorite. Yeah, no, absolutely. It'll stick for you for, it'll stick with you for a long time. Um, as a scrap metal dealer, you must have a quote. What's your favorite quote? You know, my, my former boss, uh, Jack Stutz, used to tell me all the time that, uh, ex uh, excuses are the patches we use to mend the garments of failure. And that's something I've always, uh, I've always taken to heart.'cause at the end of the day, there's excuses we could make in every aspect of our lives, or we can understand that it's just a patch and we can. Accept those excuses or recognize that we're in for full control, right? And, uh, so anyways, there's a solution for everything and we just need to be creative and, and we need to problem solve it. And, uh, sometimes that means spending more money. Sometimes that means, um, making tough decisions. But at the end of the day, you know, there's no excuses. So. I couldn't end this episode any better than what you just said. So on that note, Tyler, thanks so much for being on Porn Scrappy. This was awesome. Awesome. Thanks, dude. Appreciate it.
