Our product is a dog toy made of recycled denim. We cut the back pockets from jeans, stuff them with scraps of denim, then sew them closed. Some dogs will fetch and casually play with the toy. Other dogs will try to chew a hole in the toy and pull out the stuffing. The Packit Pocket toy will last longer than most synthetic fiber toys, and the stuffing can be re-stuffed to extend the life of the toy.
Benefits to the dog include:
- Chew toy to clean teeth
- Apparel grade denim does not have the synthetic components of polyester fabric toys
- Durable stuffing can be re-stuffed from torn holes for another play session
This project could also contribute to achieving the Austin Zero Waste Strategic Plan goal of diverting 90% of the total waste materials generated within the city limits by increasing the awareness of curbside textile recycling and charitable donations.
Our products are created by repurposing recovered materials. We depend on a steady stream of denim to be recycled by being donated to charitable organizations, and not discarded.
Austin Resource Recovery provides curbside recycling collection to single-family households. The program excludes fabric, clothing and textiles, but they have partnered with Simple Recycling to collect clothing for its curbside customers. Collection is on customers' regular recycling day and week.
Unfortunately, a 2015 study showed that an estimated 18,000 pounds of textiles are going to the landfill every day from Austin Resource Recovery's curbside customers.
The first recommendation of this study was to ensure customers are aware of the materials that may be diverted. Our dog toy is an example of quality reuse, and our marketing will promote the value of donating, recycling, and repurposing materials.
We are using denim from recycled jeans.
When Austinites donate clothing, the materials are graded, and the top-quality materials are resold by thrift outlets. Mid-grade is exported to international markets, and the remaining items are processed for raw materials.
An Austin company purchases donated jeans as raw material and cuts the legs off for rags in industrial applications. The waist section is currently being sent to landfill. We recover about 75% of this material for dog toys.
We have designed a simple product that can be easily modified.
Our manufacturing and sales processes depend on data driven decisions.
Resources are in place to begin making and selling product within 90 days.
Production process (In place, bids for production received):
Our raw materials and sub-assemblies are built by an established waste-product deconstruction company.
Our products are assembled and packaged by an existing company that specializes in high quality mid-volume production of textile products.
Our finished products are warehoused, sold, and shipped by Amazon.
All elements in the supply chain have open and strong communication about capabilities and cost structures.
Sales process:
Our product listing on Amazon is our most important piece of marketing material. We will extensively A/B test the videos, pictures and descriptions in the product listing, and the paid advertising to drive customers to the listing.
Our second most important material is paid and earned social media placements, targeting owners in the United States of average-sized breeds (retrievers, pointers, setters, hounds) who purchase pet products online.
Our third most important material is our web site, which will serve as product reference, and to drive customers to the Amazon product page.
Customer conversation:
Our most basic conversation are customer reviews on Amazon, which influence purchasing decisions and search result ranking.
Amazon also provides a limited ability to reach out to a customer to ask them to opt-in to a direct conversation with the producer. If we can engage our customers, we can get better information on the purchase decision, and better understand the use of the toy in the context of the relationship between the owner and the dog.
There are five factors that will affect scalability: materials, deconstruction, assembly, distribution, and reachable customer demand.
Materials:
The Austin source can provide materials for 2,000 toys per month. A second company in Houston could provide similar quantities at no cost and might ship at their expense to Austin to avoid disposal fees. If we exceed these volumes, bulk jeans can be purchased by the ton. If we purchased the entire jean, we would also have the large pieces of denim from the legs available for new products.
Deconstruction:
We have partnered with an established deconstruction company, and they estimate that material preparation will require 27 work days per order of 2160 toys. They have a significant work force and could support a 10x increase to 21,600 toys per month. If we purchase jeans in bulk, they can continue to partner, and provide materials for future products.
Assembly:
Our assembly partner can support growth and would partner with similar Austin companies to support a 10x increase.
Distribution:
A 10x increase in volumes will probably require that we balance our inventory across several Amazon distribution centers, at a potentially higher shipping cost.
Reachable customer demand and feedback:
Cost effective customer acquisition and retention will grow to become a larger and more complex operation as the scale increases.
Growth of customer demand is based on the assumptions that:
- Customers will repeat past purchases of a product designed to wear out
- Customers value the environmental impact of their purchases
- Customers value the health and happiness of their dogs
- We can maintain the customer's attention in a noisy environment
Phase One -
Our initial phase brings a single product to market, and builds the infrastructure to collect cost data and customer feedback. This model is designed to have the possibility of survival from only the initial investment of competition prize money.
Use of funds
275 - Federal trademark filing fee
250 - Registration of product bar codes
5000 - Initial production expenses and inventory for 720 3-packs (2160 toys)
500 - Videos and photography
500 - Kickstarter. We will launch a 60-day Kickstarter concurrent with the launch. The rewards for supporters will be products from the initial production run. The success threshold will be low, at $1000, with the goal of oversubscribing to meet the matching funding requirement. Additionally, Amazon has a featured section for successful Kickstarter projects.
2500 - Paid targeted advertising
Remainder - Unallocated
If the Kickstarter fails, we will raise the matching funding requirement as high-risk loans from friends and family.
If the project does not achieve break-even with the initial funding, or if additional capital could accelerate growth, we will pursue additional friends and family loans.
Phase Two
We expect to grow past our supplier's ability to provide us with waste product, and we expect to purchase bulk jeans by the truckload. We will need new products to use the denim from the pant legs. One possible product are dog beds. Dog beds could also use recycled sweaters for stuffing, which currently have a low recovery rate and are usually sent to landfill. We will use our demonstrated experience from dog toys to secure lines of credit from banks, individuals, and Amazon's banking group to launch this product.
I am an industrial engineer. I started my career with a degree from Texas A&M in Industrial Engineering and spent the first part of my career in planning operations for large corporate factories. Along the way, I earned a Master's in Technology Commercialization from the McCombs Business School at The University of Texas. I've spent the last 12 years founding or working for startups. Some had success, some did not. Some were well funded, some were not. All of them had the requirement that they had to find and satisfy a customer demand at a certain price point, limited by a certain amount of capitalization and resource.
I recently worked with a startup that wanted to import custom designed textile products, including dog toys, from China. These dog toys would be made of 100% synthetic materials and were designed to be as inexpensive as possible. As I built the financial models and the supply chain, I could not escape the idea that every ocean shipping container of toys we imported could be expected to be in landfills within 30 days of the sale to the customer. Regardless of the financial success of the model, the environmental impact of the project could not be reconciled.
In many ways, this project is the product I wish I could have built for that company.
I've designed this company to be simple and agile. I'm using it as a real-world lab to experiment with the lean startup philosophy of Eric Reis, as told in his book "The Lean Startup". I started by making 36 prototypes. I gave 14 to my dogs, and I gave 22 to friends with dogs. The feedback was that fully stuffed toys were easy for dogs to puncture. We reduced the amount of stuffing by 50% and made another batch of 24. The revised toys are squishier, last longer and are cheaper to ship.
This business is ready to start producing products for sale. Our standard order size is a pallet of product, a total of 2160 toys packaged as 720 3-packs. We plan to complete our first order within 90 days of the end of the competition. Our Phase One goal is to consistently produce and sell at least one pallet of product every month.
Direct labor is the work that goes directly into making the product. The direct labor that goes into our products may be done by a number of workers, so we take the number of direct labor hours and put it in terms of a full time equivalent employee (FTE). For example, 40 hours per week of work would be one FTE.
Each pallet of product, including the initial pallet, will require the follow direct labor from our partners:
Deconstruction (Josco) - 1.3 FTE
Assembly (Stitch Texas) - 0.6 FTE
Total: 1.9 FTE per pallet of toys produced.
Additionally, several people at both companies will contribute indirect (administrative) work,
Josco and Stitch Texas have an existing working relationship. This project will strengthen this relationship and help build the capabilities available for our future projects and other future startups that could repurpose recycled materials.
Josco is one of Austin's oldest recycling companies, and The Austin Business Journal recognized them as a "Best places to Work" winner in 2013.
Advertised job postings for Stich Texas state wages in the range of living wage in Austin for the type of direct labor we need.
As we continue to grow, our consumption of repurposed materials will drive an increase in a range of jobs, including:
- Charitable donation centers
- Material sorting
- Product prototyping
- Packaging and transport to distribution centers
- Material repurposing
- Product design
One goal of our first phase is to repurpose all of the blue denim waste from the existing process at Josco. The estimated annual waste from this process is 12,000 lb. We can recover about 75% of the material for use in our products, meaning we would repurpose 9,000 lb per year for dog toys. The remaining 25% is mostly brass zippers and pocket linen. Both could be sorted for use in other products.
Our production of products using recycled materials ranks in the "Highest Use" tier of the Zero Waste Hierarchy, as adopted by the City of Austin.
A cynic might argue that we are only postponing the ultimate arrival of this denim into the landfill, once a dog toy is destroyed and discarded. I would counter that this use of denim also has the following benefits of things that did not happen because our denim dog toy exists.
- A competing toy, made of synthetic materials and shipped across an ocean, was not sold, and that synthetic material did not end up in a landfill.
- Our durable denim toy may outlast several cheaply made toys, preventing the disposal of several synthetic toys in the landfill.
- Our reused denim prevented the use of 1500 gallons of agricultural water that would have been required to grow and process first-use cotton for each toy.
I hope that our toys will also serve as a visible example of the utility of donating all used textiles and apparel for reuse and recycling. A 2015 study by the City of Austin showed that an estimated 18,000 pounds of textiles are going to the landfill every day from single-family homes. Each toy that causes a single person to adopt existing curbside textile recycling, or to take their clothes to a charitable donation center would help reduce this number, in Austin and in all markets where we sell our toys.
