DATE: Monday, June 30, 1997                 TAG: 9706280336

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY TOM SHEAN, STAFF WRITER 

DATELINE: CHESAPEAKE                        LENGTH:  121 lines

TALKING TRASH SMALL NORFOLK HAULER PLANS TO EXPAND ITS BUSINESS BY: BOOSTING WORD-OF-MOUTH GETTING MORE CONTRACTS BUYING MORE TRUCKS.

Beneath the golf clubs in the trunk of his car, David A. Leon keeps a couple of marketing tools: a can of gray spray paint and an envelope full of Atlantic Disposal signs.

When he sees a gray Atlantic Disposal trash container defaced by graffiti or missing its identification, he remedies the problem immediately.

``The containers are our billboards,'' Leon said. ``By keeping them clean, we're marketing the company.''

The targets of Atlantic's promotional effort are big users of waste-hauling companies: managers of shopping centers, apartment complexes and office buildings.

By winning their business, Leon and his partners, Steven H. Eichelbaum and Joe Eichelbaum, hope to build their company into a major player in the local waste-hauling business.

But Atlantic has to compete in a market dominated by a handful of large, well established giants. For the company to grow, it will have to take business away from the likes of Browning-Ferris Industries, Waste Management Inc. and USA Waste Services.

For decades, local waste-haulers began as tiny enterprises with one or two trucks. They expanded gradually. When the list of customers grew, they bought another truck and added a few more containers. That pattern changed in the 1980s when giant nationwide companies began acquiring local independents to gain footholds in the Hampton Roads market.

How is Atlantic likely to do in this environment? One veteran in the business thinks it will be a struggle.

``Today, it's a mature business and much more competitive than it was in 1975 or 1985,'' said Dwight C. Schaubach, who started the Norfolk waste-hauling company Bay Disposal with his brother in 1975. They sold it to a much larger waste-hauler in 1989.

If he were starting in the waste-hauling industry today, the process would be much more difficult than it was two decades ago, said Schaubach, whose Chesapeake-based Schaubach Companies manages a group of waste-hauling companies that he sold last year to Fort Lauderdale-based Republic Industries Inc.

It's a tougher environment partly because the competition for good drivers has intensified and certain costs like insurance are more burdensome for smaller companies than for nationwide companies.

Leon, Steve Eichelbaum and his father Joe insist they've embarked on their expansion with their eyes wide open.

``We had no illusions about what it takes to run this business,'' Steve Eichelbaum said.

Standing outside the company's cramped one-story office and garage on Freeman Avenue in Chesapeake, he joked that he was immersed in the details of recycling when growing up. ``When I was old enough to walk, my father would drag me down to the scrap yard'' that his family owned.

For years, Atlantic concentrated on disposal of recyclable materials from Navy installations. The company received an increasing number of calls from local companies asking for disposal service, said Eichelbaum, 43.

``When I realized we couldn't handle the government contracts and do the private-sector work, too, David and I started talking,'' he said. ``Our business plan evolved over two years.''

After analyzing what their expenses would be and what they would need to expand, Leon and the Eichelbaums lined up bank financing for additional equipment. So far this year, they have purchased six trucks, which doubled the size of their fleet.

Having more trucks and containers became part of their marketing campaign.

``You have to convince the prospective customer that you've got sufficient equipment to handle their business,'' Leon said.

While adding trucks and containers, Atlantic also has expanded its workforce from 14 to 21 so far this year.

The company's gritty environment near the Elizabeth River is a world away from Wall Street, where Leon spent two years in the 1980s working for investment banking firms. After getting a master's degree in business administration at UCLA, he spent 4 1/2 years working on finance and strategic planning at First Hospital Corp., the Norfolk-based provider of mental health services.

The experience at First Hospital was valuable, but being part of a small company had a special appeal, the 32-year-old Leon said.

``I've always been attracted by the excitement of growing a business and participating in the decision-making,'' he said.

Leon, who spends 90 percent of his time on sales, and other officers try to win over prospective customers by emphasizing service.

But no matter how convincing their sales pitch might be, they frequently encounter a major hurdle: The businesses they approach often have contracts of a year or more with a competing waste-hauler.

Leon declined to say what financial goals the company's principals have set. However, Atlantic is likely to become profitable later this year, he said.

One favorable development has been the amount of construction in the region, which has provided the company with opportunities to haul away debris. Handling construction debris accounts for about 70 percent of Atlantic's revenues. Collecting trash from office buildings, stores and restaurants generates the other 30 percent of revenues.

The company uses public and private landfills in the region for dumping the waste it hauls. To reduce what it pays the landfills and to generate additional revenue, Atlantic plans to eventually sort out those loads containing large amounts of recyclable material like metal, wood or cardboard, Leon said.

For now, Leon and Steve and Joe Eichelbaum have focused much of their attention on attracting customers. Sometimes that requires reminding business owners about their waste-hauling contracts.

``When we're asking businesses about the quality of service they receive, half of them don't know who they have,'' said Sam Nolder, Atlantic's general manager.

Whether a company knows the name of its trash-hauler or not, Atlantic's officers figure they have to keep the company's name in front of businesses to bring in additional customers. That's why clean containers with the Atlantic Disposal name are so important, Leon said.

``Some companies will put out bids for service, but it's too much work to gather bids from everybody,'' he said. ``Because we're new, we want people to know who we are.'' ILLUSTRATION: Color photo by Ting Li-Wang/The Virginian-Pilot

Owners of Chesapeake-based Atlantic Disposal Joe Eichelbaum (in

truck), David Leon, center, and Steven Eichelbaum and general

manager Sam Nolder (on top of the truck)...

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