A Moving Experience

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When Marty Metro moved into a home in Los Angeles five years ago, he did what many Angelenos do when they prepare to move: he scoured around local electronics stores, clothing stores and wherever else he could to find used boxes so that he wouldn’t have to pay $50 or $100 or more for boxes from U-Haul or UPS.


He found the boxes he needed, but as a former technology consultant, Metro figured there must be an easier way to obtain used boxes at a discount.


“There had to be a way to use technology to match up people who had boxes with people who needed them,” Metro said.


So he founded a company that collected boxes from people who had just moved and delivered them at half the cost of new boxes to residents who were preparing to move. He set up a storefront on La Cienega Boulevard in the hopes of appealing to environmentally conscious consumers and called his new venture Boomerang Boxes.


Metro tried to grow the business locally by using Web sites to locate people who were moving. But almost from the get-go, there were problems. He soon found himself driving all over town to pick up boxes and deliver them. Making matters worse, he often found he didn’t have the size or type of boxes that his customers needed. The company’s growth prospects soon dimmed.


“The concept was simple, but the execution was turning into a nightmare,” Metro said. “After a couple of years, we realized the concept wasn’t working well enough to grow the company. We had to get better control over the inventory.”


He spent nearly a year looking for additional capital, but was repeatedly rejected. “Same reason: ‘We love your concept, but the way you’re going about it, you’ve got no growth potential.'”


But in late 2005, Metro piqued the interest of the consultants at Santa Monica-based Funk Ventures. They were willing to sink some money into the business, but only if it was completely overhauled.


“We advised that the company stop what it was doing and develop a way to standardize the business,” said David Krasnow, a partner with Funk Ventures who agreed to come on board with Metro to re-launch the business.


The key was to develop a system of standardized packaging for the boxes, much like 20-foot or 40-foot containers, became the standard for transoceanic shipping. That way, used boxes could be collected from consumers and businesses and put into pre-set packages of boxes and then shipped overnight to customers.


So, Metro shut down Boomerang Boxes at the end of 2005 and he and Krasnow went to work on developing the new model.



Business module

Working with the Funk Ventures concept, they came up with a package box or module that met United Parcel Service standards for convenient shipping and could hold an assortment of 22 flattened used boxes in small, medium and large sizes. One module box would be sufficient to pack a typical one-bedroom apartment, two modules for a condominium or two-bedroom apartment, three for a small house, etc. Each module box would have a flat cost of $33.


“Everything is reducible to shipping modules,” Metro said.


To make the modules even more convenient for customers, they would include ample packing paper, scissors and tape so that the boxes could be folded, reinforced and sealed.


Finally, in August 2006, Metro reopened the business, setting up a warehouse in Montebello where the boxes would come in, be packaged, and sent back out again. He chose the name UsedCardboardBoxes.com so that it would be the first company name that came up when people entered the search term “used boxes” on Google.


So far, business has been brisk, spreading mostly through the Internet and by word of mouth.


An Internet search was how Beverly Hills marketing agency owner Karen Moore came across UsedCardboardBoxes.com when she was ready to move into a home she had just purchased.


“It completely took out the hassle of going around to supermarkets and retailers to find used boxes and the expense of buying new boxes,” Moore said. “All the boxes I needed were delivered to my doorstep the next business day.”


It took some time to fold the boxes and there wasn’t enough packing paper for Moore’s breakable possessions, “but they got more packing paper out to me the same day.”


The company’s geographic base has grown from just Los Angeles County to all of California, Nevada and Arizona the range of where UPS could guarantee overnight shipping at standard cost.


Alongside the residential customer base, UsedCardboardBoxes.com has also begun developing a business customer line, collecting boxes from companies, advertising them on the company’s Web site and then delivering boxes directly to other local companies.


Now that he believes he has hit upon the right business model, Metro has ambitious plans to take the company nationwide, starting with five more warehouses in different parts of the country later this year.


In expanding, Metro will run up against two sets of competitors: major national movers like U-Haul International (a subsidiary of Reno, Nev.-based Amerco) or UPS or Budget Group Inc. (which acquired the Ryder truck company in 1998) and hundreds of localized used box companies with storefronts similar to Boomerang Boxes.


Will it succeed? In its favor, UsedCardboardBoxes is poised to cash in on increased environmental awareness among consumers.


But it may be a tough concept to market.


“People don’t move very often, and when they do, they generally prefer the convenience of picking up boxes from the moving company,” said Jim Barrett, director of research for New York-based C.L. King & Associates Inc., who has a “buy” rating on U-Haul’s parent company, Amerco.


Metro said he believes that the niche of environmentally conscious consumers and businesses looking for alternatives to scouring around for used boxes will continue to drive his business for years to come.


“The constant refrain I hear is, ‘I’m so glad you’re doing this. I only wish I knew about this before.'”



UsedCardboardBoxes.com


Founded:

2006

(Predecessor company, Boomerang Boxes, founded 2002)


Core Business:

Collecting used cardboard boxes, packaging them and reselling them at discounted prices


Employees in 2006:

3


Employees in 2007:

6


Goal:

To become a nationwide seller of used cardboard boxes


Driving Force:

The need of both consumers and companies for large numbers of boxes when they move

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Howard Fine
Howard Fine is a 23-year veteran of the Los Angeles Business Journal. He covers stories pertaining to healthcare, biomedicine, energy, engineering, construction, and infrastructure. He has won several awards, including Best Body of Work for a single reporter from the Alliance of Area Business Publishers and Distinguished Journalist of the Year from the Society of Professional Journalists.

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