Posted On: 12/21/2013 10:16:00 AM
Post# of 3844
PhredG explained very eloquently why the reverse logistics market relies on very specific criteria to be a success! And, he clearly shows why 2TRG is a resource that can become extremely profitable in a very short period of time. Why? Because the infrastructure is already there and EWSI is currently changing the plant over to accept more feedstock. The 2TRG acquisition news didn't give the stock a pop like everyone thought. Maybe it was already built into people's minds as being done! Hard to say really. But, this is indeed a critical acquisition for EWSI. Two brick and mortar operating facilities with pretty new equipment that has a 75M production capacity. It really all depends on what they recycle, but the opportunity for rapid cash flow positive amounting to millions headed to corporate is very real in 2014!! Anyway, the following is a post from another board from PhredG which should help everyone understand why 2TRG is a monster acquisition:
Ha. I know something you don't know. Could be industry experience perhaps?
Attack me all you want, but I'd be willing to bet that I know more about this company than most. So EWSI doesn't own a facility in Timbuktu? It doesn't matter. I've been in the industry at a developmental level for over a decade. The industry has much more to do with forming the proper upstream and downstream partnerships as it does with having ten dozen physical locations at the onset. The single biggest line item in a waste hauler P&L is the transportation cost/processing facility relationship. As you put the pieces together, you need the flexibility to contract locations for processing that are in geographical reach of the materials processed. Hence all the JV's and other paper deals. You can make lots of revenue in this industry by having the correct geographical reach for the deal. As downstream partners process material, and the volume stays steady or increases, it then behooves EWSI to stock swap for the physical location.
Why choose the first deals in or near Columbus and Cincinnati? Why are these cities hubs of Distribution? Because 50% of the US population resides within 500 miles. This is ONE day of trucking. EWaste has to be consolidated and moved before it can be processed. It appears the 2TRG deal may actually have been thought out…. Who knew?
Ha. I know something you don't know. Could be industry experience perhaps?
Attack me all you want, but I'd be willing to bet that I know more about this company than most. So EWSI doesn't own a facility in Timbuktu? It doesn't matter. I've been in the industry at a developmental level for over a decade. The industry has much more to do with forming the proper upstream and downstream partnerships as it does with having ten dozen physical locations at the onset. The single biggest line item in a waste hauler P&L is the transportation cost/processing facility relationship. As you put the pieces together, you need the flexibility to contract locations for processing that are in geographical reach of the materials processed. Hence all the JV's and other paper deals. You can make lots of revenue in this industry by having the correct geographical reach for the deal. As downstream partners process material, and the volume stays steady or increases, it then behooves EWSI to stock swap for the physical location.
Why choose the first deals in or near Columbus and Cincinnati? Why are these cities hubs of Distribution? Because 50% of the US population resides within 500 miles. This is ONE day of trucking. EWaste has to be consolidated and moved before it can be processed. It appears the 2TRG deal may actually have been thought out…. Who knew?
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