We caught up with the brilliant and insightful Evan Burger a few weeks ago and have shared our conversation below.

Evan, thanks for joining us, excited to have you contributing your stories and insights. So let’s jump to your mission – what’s the backstory behind how you developed the mission that drives your brand?

My business partner Johnathon and I opened Ames Bottle and Can in December of last year. We are a new can and bottle redemption center in Ames, Iowa, and our goal is to make recycling fun.

The two of us had been talking for years about how there weren’t any good redemption options in Ames, and we decided to do something about it.

If you’re from Iowa, you know that Iowans are deeply invested in can redemption. We’ve had a container deposit law since 1979, and everyone who grew up in Iowa has a story about collecting cans for a club or organization, or just for spending money.

So people here are big on getting their 5 cents per container back, but in recent years a lot of redemption options disappeared. Even before the pandemic, redemption centers were closing down because they weren’t earning enough money. And then when COVID hit, grocery stores stopped taking back containers, so for example, people in Ames would have to drive 45 minutes round trip to a nearby town that still had a redemption center.

It got bad enough that in 2022 the state legislature decided to update the bottle bill. One big change they made was increasing the handling fee that redemption centers get per container, from one cent to three cents. The day the bill passed, I texted Johnathon and said we had to do it, that now was our chance to fix the redemption problem in Ames. The rest is history!

Evan, love having you share your insights with us. Before we ask you more questions, maybe you can take a moment to introduce yourself to our readers who might have missed our earlier conversations?

The way container redemption works here in Iowa is that customers pay a 5 cent deposit on every eligible beverage container they buy — so for instance, you pay a 60-cent deposit on a 12-pack of canned beer, or a 5 cent deposit for a single 20oz bottle of soda.

The retailer you are buying that beverage from also pays that same five-cent deposit to the distributor who manufactures the beverage in the first place. So when you pay your nickel deposit for each can or bottle, that money is ultimately being held by the distributor until you redeem the container.

To get your nickel back, you take the empty container to a place that offers container redemption. Some grocery stores offer this service, but a lot have chosen to opt out. That’s where redemption centers come in: redeeming empty beverage containers is all we do.

We pay our customers five cents for each empty container they bring in. At that point, once the container has been redeemed, the retailer and end customer have each paid a nickel and received a nickel, leaving them whole. The distributor is five cents ahead, and we (the redemption center) are five cents behind.

The final step is for us to sort all of the containers that we have purchased by distributor, and then sell each distributor their respective containers, at the rate of eight cents (the five cents we paid the customer plus a three cent handling fee).

At that point the redemption process is complete: everyone has gotten their money back, and the containers have been sorted, making them easy for the distributors to recycle.

One question we often get is how the 3-cent handling fee is funded. A lot of people think the government covers the cost in some way, either as a grant or some sort of tax on the beverages. That’s incorrect — the state is only involved in enforcing the provisions of the law, not in collecting any of the five cents.

Rather, the three cent handling fee is paid by the distributors out of all the nickels they gathered for containers that are never redeemed. Iowa’s redemption rate is pretty good, but there will always be a nontrivial number of containers that are not redeemed, and at least currently, that number is large enough to cover the handling fee that makes the whole system work.

Has your business ever had a near-death moment? Would you mind sharing the story?

Our cashflow was pretty rough in December. We knew it would be hard, but what we didn’t know was just how much business we would get right off the bat.

As with every business, you have expenses that you have to pay up front, and you don’t recoup those costs until your downstream partners pay you. But in our industry the two pieces have drastically different expectations on timeline. The customers who bring in their cans expect to be paid right away, or as close to right away as possible. But we don’t get paid for those cans until the beverage distributors (Pepsi, Coca-Cola, the local beer distributors, etc) pick up those containers, count them, and then process payment. The law dictates a timeline for how the amount of time that distributors have to pay us, but as you can imagine, it takes time to set up those transfers, and even when they are on time, it’s still on a slower timeline than what we have to pay out to our customers.

The other unique thing about our situation is that the increased handling fee didn’t go into effect until January 1st, so our business plan was built on the idea that we would hold onto as many containers as possible until that date. If we sold a container back to a distributor on January 1 instead of December 31, we would get 8 cents for that container instead of 6.

So we did a lot of legwork trying to predict how many containers we would get in December, and plan around those projections, but our actuals blew all of that out of the water. We still tried to hold onto as many of them as possible until January, in order to get the increased handling fee, but we ran out of space, and we desperately needed the cashflow in order to pay out new customers. We ended up taking out additional loans to make it all work — which all worked out in the end, but we learned that we needed to revise our volume projections way upward.

Any stories or insights that might help us understand how you’ve built such a strong reputation?

The bar for customer service is really low in our industry — people are used to a pretty unpleasant experience when returning their cans. Either they are going to a grocery store that doesn’t really want to be doing redemption, or they are going to redemption center that’s inconveniently located and has a bunch of rules about how your containers have to be sorted.

We wanted to change all of that. We of course still have rules on what people can bring in, and our location isn’t the most convenient, but we work really hard to communicate what the rules are, in our online presence as well as in person. And I think we’re succeeding — 100% of our reviews on Google and Facebook are 5-stars.

We also really prioritize cleanliness. Redemption is inherently a sticky, smelly business, but we isolate the customers from the dirty work as much as possible. Most redemption centers are just one big space, with sorting and storage happening right next to payment and customer service. Our space is set up differently: we have a lobby for customer-facing work and a separate shop floor for sorting and storage. The vast majority of our customers never step foot in the back — we are able to greet them, take their containers, and pay them in the lobby.

This seems really basic, but it helps a lot with customer experience. Even if the back gets sticky and messy sometimes, we’re able to keep the lobby clean (at least by redemption center standards). There’s a cost in terms of the additional square feet of lobby space that we’re paying for, but in our opinion it’s more than worth it in order to make the experience as pleasant as possible for our customers.

Contact Info:

• Website: https://www.abccans.com
• Facebook: https://www.facebook.com/profile.php?id=100086722663323
• Other: Google Business Profile: https://www.google.com/maps/place/Ames+Bottle+and+Can/@42.0222904,-93.6972484,15z/data=!4m2!3m1!1s0x0:0x82991c8ff19007d3?sa=X&hl=en&ved=2ahUKEwje6J3tgcD9AhU0lYkEHSe2DY0Q_BJ6BAhfEAk

Image Credits
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