*NEWS*LASERCYCLE DIVIDES TO CONQUER

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*NEWS*LASERCYCLE DIVIDES TO CONQUER

 user 2006-05-17 at 10:05:00 am Views: 79
  • #15477

    LaserCycle divides to conquer
    Lenexa firm spins off its wholesale division
    LaserCycle
    Inc., a remanufactured printer cartridge firm that’s been growing
    faster than ink dries, has spun off a division into a separate,
    500-employee corporation.The new corporation, InkCycle Inc., has taken
    over remanufacturing and wholesale sales of the roughly 750,000 toner
    and inkjet cartridges cranked out each month at 11100 W. 82nd St. in
    Lenexa’s Brookhollow Business Park.LaserCycle, which retained 30
    employees and direct sales of cartridges and other printer supplies and
    services, completed the divestiture on April 1.”As we continued to
    grow,” said Brad Roderick, executive vice president of InkCycle, “it
    became clear that we had two separate business models — one that ships
    thousands of units and one that sells a few cartridges at a time. We
    needed two distinct companies so they could focus on their own sets of
    core competencies.”Roderick said LaserCycle founder Rick Krska had led
    the corporation to double-digit growth each year since he started
    refilling and recycling toner cartridges in his basement in
    1992.Roderick declined to comment on current revenue, and Krska, who is
    in Europe, could not be reached. But Roderick said LaserCycle hit its
    $40 million target in 2003 and grew about 30 percent a year through
    2005.Those figures, plus the 50 percent growth Krska projects for
    LaserCycle and InkCycle this year, add up to combined 2006 revenue of
    more than $100 million.Contracts to supply private-label remanufactured
    cartridges to several national retailers fueled the company’s rapid
    growth and spurred the recent reorganization, Roderick said.Separating
    the companies will help the manufacturer avoid coming into competition
    with customers that sell directly to businesses.Now, LaserCycle is one
    of those customers. To keep it at arm’s length from InkCycle, new
    LaserCycle leadership is being recruited from outside the corporations.
    Charlotte Barksdale, previously with The Kansas City Star Co. and Scott
    Rice Office Works in Lenexa, recently joined LaserCycle as business
    manager. The search continues for a CEO.In addition, InkCycle has moved
    to its own 20,000-square-foot building at 8208 Nieman Road in
    Lenexa.Less than a block away, InkCycle’s CEO — Krska — presides over
    cartridge remanufacturing in the company’s 85,000-square-foot building
    in Brookhollow. A distribution center once there now consumes 115,000
    square feet in the nearby Meritex Inc. underground business
    park.”They’ve been an amazing success story over the last several
    years,” said Blake Schreck, president of the Lenexa Chamber of
    Commerce, “and it’s my understanding that they’re looking to expand
    again.”Schreck said InkCycle is exploring potential sites where it
    could consolidate operations. And the Lenexa chamber is poised to do
    whatever it can to keep the juggernaut in the city.”There are some
    negotiations going on for space,” Roderick said, but he declined to
    elaborate.Pam Whiting, a vice president of the Greater Kansas City
    Chamber of Commerce, which named LaserCycle as its 2004 Small Business
    of the Year, said one secret of Krska’s ongoing success can be found on
    his business card. It reads, “Rick Krska, chief executive
    servant.”Krska inherited his “servant leadership” philosophy from his
    father, who taught him that “a successful business stems from
    identifying a way of being of service to others,” Whiting said.After 14
    years in production management at AlliedSignal Aerospace, Krska refired
    the entrepreneurial spirit that prompted him to start several small
    businesses as a young man.Krska researched various fields, then decided
    to apply that spirit and the high-precision manufacturing skills he had
    learned at AlliedSignal to the production of cheaper, environmentally
    friendlier printer cartridges.LaserCycle originally focused on regional
    sales of remanufactured toner cartridges. Its product line broadened in
    1996, when Krska launched the InkCycle division to capitalize on the
    emerging recycled inkjet cartridge market.In 2003, the company’s
    national wholesale business kicked in with the signing of a deal to
    supply remanufactured inkjet cartridges for the Staples retail chain.
    Since then, InkCycle has picked up supply contracts from several other
    superstore chains in the office products, consumer electronics, food
    and drug, and discount retailing sectors.Remanufactured and generic
    cartridges now account for about 35 percent on the toner side and about
    10 percent on the inkjet side of a roughly $30 billion U.S. printer
    cartridge market, Roderick said.Further penetration has been hampered
    by quality issues associated with some of InkCycle’s competitors,
    Roderick said. But because of Krska’s emphasis on high quality and
    service, he said, InkCycle continues to grab share in a sector that
    original cartridge manufacturers avoid.”The waste stream is our supply
    chain,” Roderick said. “So there’s a lot more human work that goes into
    it. Plus, it’s not something with enough size for a Hewlett-Packard to
    put into their portfolio.”The world’s largest inkjet cartridge
    recycler, InkCycle manufactures about 50 different toner cartridges and
    about 30 different inkjet cartridges — some of them for original
    cartridge manufacturers.The company’s manufacturing equipment is
    custom-designed and built in-house, Roderick said, and it is operating
    20 hours a day, six days a week to keep up with demand.That demand has
    boosted the fortunes of InkCycle and its half-dozen area suppliers.”Our
    business has quadrupled with them,” said Lon Wilkerson, co-owner of
    Service Pak, a Lenexa company that supplies printed cartridge boxes.
    “Rick and his team have great marketing skills, and they found a great
    niche in the computer world.