Photo by Travis Anderson
Brothers William (right) and Philip Dworsky can't contain their innovative ideas.
Back in the Family
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After negotiating informally over the course of several years, brothers Phillip and William Dworsky were unexpectedly given 10 days to determine the fate of the company that their grandparents had founded more than a century ago.
Consolidated Container Company, a Northeast Minneapolis business that reconditioned, distributed, and recycled drums, pallets, and other industrial containers, had been sold out of the family in 1998 by the Dworskys’ father and uncle. Consolidated then was merged with a consortium of four regional drum and pallet companies to create a public company called Palex. That company was subsequently sold twice more.
By 2004, Palex was losing more than $1 million on $10 million in revenue. It was in danger of being liquidated when the owners offered the Dworsky brothers a 10-day due diligence window to purchase it.
For the Dworsky brothers, who had both worked at the company for most of their lives, it was both an easy decision and a difficult one. Phillip was helming Container Logix, a Minneapolis-based container distribution business he had founded. William was running a drum business in Los Angeles.
The two brothers decided to go for it. “We saw the opportunity to succeed in the business that we both knew,” Phillip says. There were problems: lack of profitability, low employee morale, and strained customer and supplier relationships.
“But we felt we had the ability to correct those flaws and turn it into a profitable business,” Phillip adds. “And we had some pride from a historical perspective—there were family, employee, and customer relationships that we wanted to maintain.”
The Dworskys ran the numbers, then arranged financing and insurance. Once the papers were signed, they restored the Consolidated Container name. “The name had disappeared from 1998 to 2004, but it was well known within the marketplace,” Phillip says. “When we came back, it was pretty seamless.”
One of the challenges the Dworskys faced was cleaning out an industrial yard filled with mountains of plastic and steel drums. Searching for options, the brothers purchased a plastic drum company in South Carolina that had the equipment they needed to recondition and recycle those containers. That resulted in a new area of business, which now generates upward of $2.7 million per year.
“We provide a total approach to the product’s life cycle, from initial purchase to ultimate end disposal,” Phillip says. “We clean, decontaminate, and de-identify containers, then recondition them for reuse. Customers also have the option of buying new containers. At the very end of the product’s life cycle, we recycle the scrap materials—chiefly steel and plastic—that are then made into raw materials for manufacturing.”
“Our customers, especially our Fortune 500 customers, require the best day-to-day operating practices available,” William says. “They need to know that they’re not going to have future liability issues related to their products being recycled or disposed of.”
The Dworskys also began repairing the damaged relationship between the company and the union. “We asked for the opportunity to restore that lost trust, and that effort was embraced,” Phillip says. “How you treat your employees is in return what you will get back, and it’s been a great relationship ever since.”
In September, Consolidated Container completed its 16th consecutive month of growth. Revenues, which have increased by double-digit percentages every year since 2004, are projected to surpass $16 million in 2008. Says William Dworsky, “We think that the future is bright and that there continue to be opportunities to reduce costs, increase market share, and expand our opportunities.”