Never one to waste a good opportunity

THE FRIDAY INTERVIEW:Rita Shah, founder of Shabra recycling group

IT IS A bright Monday morning in September, just outside Castleblayney, Co Monaghan. A vast set of machinery slowly chugs into action.

“In five to six hours this plant will be up and running, then it will be working at full capacity until Saturday morning when it is switched off,” Rita Shah, founder and managing director of the Shabra recycling group explains, as she takes a handful of crystal pellets in her hand. “Until then, thousands of tonnes of waste will be processed, recycled and reprocessed into something new.”

It may not have the scale or international presence of Kingspan, its neighbour in the small industrial estate on the outskirts of the town, but Shabra is a model of the kind of SME business the Government is trying to promote.

A company with a strong foundation in innovation, a firm eye on export markets and a source of jobs for the local economy, it is no surprise that Shabra, which this week announced a €3.5 million Enterprise Ireland-backed investment, has received numerous business and entrepreneurial awards over its 24-year history. They are proudly displayed in the headquarters foyer.

It’s a long way from the company’s humble beginnings in 1986. “When we started, all we had was a maroon briefcase and a transit van.” Shah recalls. “We didn’t even have a proper office. There was a phone in the old shed outside in the farmyard in Carrickmacross . . . I used to answer in an official voice, saying ‘Good morning, Shabra Plastics’.”

Shah’s own background is a world away from the company she has built up with business partner Oliver Brady.

Of Indian ancestry, Shah was born and grew up in Kenya where she was educated by Irish missionaries. Her father, a successful businessman whose business interests included coffee and sisal-growing enterprises, was an enormous influence and inspiration. “His wish was that his children would join him or go into some kind of business.”

In the early 1980s, Shah took up that challenge when she moved to Ireland and became involved in a business venture backed by her father. Brady, who had worked for her father in Kenya, had set up a recycling business in his native Monaghan. Rita’s brother and sister were involved in the early stages of the business. When they decided to leave, it was Rita’s cue to join.

“I was living in England at the time and the idea was that I’d help get the business to a certain level, and then leave it to Oliver. I’d never expected to stay as long as I did.”

Shabra – which is an amalgamation of the surnames of the two founding partners Shah and Brady – began as a plastics-manufacturing operation in Carrickmacross. It started out printing bags, then manufacturing its own bags from plastic bottle or PET waste, which it then sold to retail and business customers.

While it initially imported recyclates, it began to source its own waste directly from within Ireland, an innovation at the time.

In 2002, the business hit a major hurdle. “I remember the day so well. I was visiting someone in hospital at the time when I heard on the radio that the Government was introducing a charge on plastic bags.”

While the idea of introducing a plastic bag levy at the point of sale had been mooted, the decision by the Government to implement the measure so definitively had not been expected.

Instantly Shabra’s business was affected. Turnover was hit by some €4 million, as demand for one of the company’s main products was effectively wiped out. “We were faced with a major decision. It was either sink or swim.”

Negotiations with the banks followed, during which Shah had to give her own house as collateral. “We came up with a business plan which set out our strategy. Rather than look for a new customer base, we went to our customers, people with whom we’d built up a relationship over years, and found out what else they might want.”

The company began a slow process of diversifying. From producing plastic bags for retailers, it shifted its focus to producing other goods, such as long-life shopping bags, paper boutique bags and food containers. Within a year the business was back on track.

Today, the business has two main strands – the manufacturing of recycled refuse bags, which are produced on site, and the production of PET flake from the reprocessing of post-consumer bottles. This plastic recyclate is then sold either domestically or into export markets, where it is used in the manufacturing of R-PET deli containers, or as the fibre to make nappies, carpets and even fleeces.

In addition, wood chip and shredded paper used by the equestrian industry and farmers are produced during the reprocessing process.

The €3.5 million investment announced yesterday, which is part-funded by the Enterprise Ireland Growth Fund, will see a new state-of- the-art plastic bottle-sorting plant at Shabra’s seven-acre facility, significantly increasing capacity. More importantly for Shah, the new plant will result in 35 new jobs over three years.

Employees are a genuine priority for her. For all its modernity and emphasis on innovation, there is something of the bygone age about Shabra, a company which styles itself as a family business, one that plays a major role in the social fabric of the local community.

“My father used to say, your business is your people. Your people will break you if they don’t carry the weight.”

It was concerns about job losses that impelled her and Oliver to persevere with the business when the plastic bag levy was introduced, she says. This ethos is reflected in the workplace itself, where incense candles serenely burn in the foyer, bringing a touch of the exotic to the distinctly unglamorous world of waste recycling.

However, beneath the compassionate exterior is a steely business woman. Ask Shah about her ambition for the company and she doesn’t hesitate. “We aim to be the best company on the European stage for processing. In fact,” she pauses, “we are one of the best.”

Her confidence is not unfounded. Turnover at the company is back where it was before the bag levy was introduced, while the company has a growing share of an export market eager to pay a high price for what Shah describes as Shabra’s “added-value” quality product.

Shah herself is one of the finalists in this year’s Ernst Young Entrepreneur of the Year awards.

While exports represent 55 per cent of the business, she expects that to increase significantly, particularly as a result of the new plant.

Shabra is operating in a market space that is growing. According to Repak, 12,000 tonnes of PET bottles are collected in Ireland each year, a figure that is expected to grow significantly in the coming years as PET begins to be used in other packaging formats such as plastic fruit and salad trays.

Within the recycling industry itself, Shabra occupies a valuable niche position. It is still the only company in Ireland that collects, sorts and reprocesses from one facility, its closed-loop system epitomising the integrated approach to recycling, espoused by environmentalists.

On the subject of the green aspects of her business, Shah is reluctant to associate herself with any particular movement. “I am not a political person,” she states. Nonetheless, she believes passionately in the philosophy that underpins her commercial business. “I believe that everything has a value. It’s nothing to do with my business. It’s life after death.”

A committed Hindu, Shah takes a holistic approach to the production and consumption of material goods, something see sees through Shabra’s charity work in Kenya.

“I see it with the kids in Kenya, wearing old Manchester United jerseys that have been passed on from Ireland or England. They have a value for them. Even though they’re worn and torn, when they’re wearing them they’re going to hit the ball as hard as possible.

“Something that has no value to us, gives them hope. It makes them believe that, some day, they can be like Obama.”