Pencil made from scrap tires wins space on Staples’ shelves

John Erlandson’s first idea for the reuse of scrap tires was to replace expensive cement grave-liners with a rubber casket
vault.

The notion popped into his head while he was selling grave markers, one of the many odd jobs he’s held while pursuing his
dream of creating a tire-based product with mass appeal.

Erlandson abandoned the burial-vault idea early in that quest, which began more than a decade ago, and quickly seized on something
that will at least fit neatly onto store shelves. The 63-year-old Lebanon resident holds the patent on a recycled-rubber pencil,
which Staples plans to start selling in June.

"There’s a lot of great ideas out there, but to get from point ‘A’ to point ‘B’ is more of a process than you can describe,"
Erlandson said.

Though weary, Erlandson added, "I believe in the Winston Churchill theory: Never, never, never give up. I knew the size
of
the market. I knew our potential. I wasn’t going to give up."

Erlandson recently received his first royalty check from a licensing agreement with leading pencil-maker Dixon Ticonderoga.
(He declined to disclose the amount or terms of the deal.)

The company calls Erlandson’s No. 2 the Ticonderoga Renew. The all-black pencil has a stiff barrel that feels slightly rubbery,
but it sharpens like cedar. Pulverized tires make up 30 percent of the casing. The rest of the ingredients in the compound
are secret.

Dixon expects in the first year to sell 4 million to 5 million of the wood alternative, or 1 percent of the 500 million pencils
the company sells in the United States alone.

The retail price of a 10-pack will be about $4, quite a bit higher than the traditional yellow Ticonderoga, which Staples
sells for $2.49 a dozen.

Dixon began selling the tire pencil in August to business customers as an advertising tool. It will start targeting consumers
this spring.

"Everybody’s into the green initiative to a certain degree," said Tony Rufo, Dixon’s vice president of U.S. sales.
"If it
weren’t such a tough economic environment, it’d be a slam-dunk."

One of Erlandson’s advisers, a veteran of the writing instruments business, thinks Dixon could sell 200 million tire pencils
worldwide, and that its potential goes beyond a "green" marketing gimmick.

"I think it’s going to break loose, and it’s the right time for it," said Larry Krane, a former executive with Faber-Castell
who now is co-owner of a small manufacturer, Panda Pencil of Trenton, Ohio. "Everybody’s looking for a recyclable product."

Consumers aren’t the only ones looking. The shrinking worldwide supply of suitable wood has plagued pencil-makers for years,
Krane said. But no one has come up with a comparable alternative that’s also easy to manufacture.

"It could become a product that eliminates the wooden pencil," Krane said.




Cold call master

A former tire salesman, Erlandson didn’t know much about the chemistry behind baking reclaimed rubber into new compounds,
but he does know how to work a phone.

One of his first cold calls in the late 1990s was to Rubber Development Inc. in Waverly, Iowa.

"As a custom manufacturer, I get a lot of people [who] come to me with ideas, where they’ve invented things," CEO
Vernon Gidley
said. "The problem is, they don’t know how to sell it. They don’t know how big their market is, or how to get to it."

Gidley, who shares the patent, saw enough potential in the tire pencil to become Erlandson’s business partner. He and a third
partner, manufacturing equipment businessman Carl Chiofolo, each have invested more than $100,000, and, Gidley added, "incredible,
countless hours."

Soon after being awarded the U.S. patent in 2001, Gidley’s plant started cranking out molded-rubber pencils. They called it
"The Solution."

Erlandson lined up distribution through a promotional products company.

"We could sell them a lot quicker than we could make them," Gidley said. "The idea went over very well."

But the pencil’s production costs still were high, and the partners wanted to license it for mass consumption. Refining the
manufacturing process took several more years, and they had to find new suppliers.

"It was very frustrating," Gidley said. "We had a lot of failures."

All that changed after they inked a deal with Florida-based Dixon Ticonderoga in late 2006.

People like Sam Kauffman, chief operating officer of Edge Rubber, a Pennsylvania company that pulverizes reclaimed tires,
have heard about the pencil.

"Is it the Dixon Ticonderoga one?" he asked. "I have an independent rep trying to get our powder into that
project."

The licensing deal was the result of yet another cold call. Krane, who couldn’t persuade his own partner at Panda Pencil to
work on the tire-based alternative, gave Erlandson the number of Gino Pala, Dixon’s longtime CEO.

Erlandson soon found himself in meetings at Dixon’s headquarters. Talks about the tire pencil survived Dixon’s acquisition
by a privately held Italian company, FILA-Group, in 2005.

Finally, in late 2006, Erlandson and his partners signed an agreement.

"All of us thought, and we still do think, it’s a really good idea whose time has finally come," Gidley said.

Tricky Ingredient


Prosaic as it sounds, the pencil is an unusual development in the world of recycled-tire products.

The roughly 285 million used tires recycled each year in the United States end up as filler in things like brake pads, hoses,
mats, mulch and athletic surfaces, Kauffman said.

The number of uses is expanding, but it’s not easy to make ground-up tire rubber bind with other materials. Molding raw rubber,
he said, is like baking with fresh flour, while working with recycled tires is like using stale cake crumbs.

The tire’s already been cured. It’s already been vulcanized," Kauffman said. "It’s going
to be difficult to figure out how to make muffins."

At 30-percent tire rubber, Gidley said, the pencil uses far more of the waste material than other products coming out of his
factory. But it won’t make much of a dent in tire heaps.

"This pencil will not have that big an impact, worldwide, on the number of scrap tires," Erlandson admitted, "But
it’s a good
start."




Rare success

At this point, Erlandson and his partners, who call their company The Solution Line, just hope to recoup their investment.
The trio hopes to come to market with more than the pencil. They’re also developing other tire-based school and office supplies.

If they ever see a profit, they will be among the very few of Indianapolis patent attorney Jim Richardson’s clients who achieve
commercial success.

"It may be a wonderful idea on paper. Actually turning it into money, or finding a market, is much more difficult,"
said Richardson,
a partner at Brinks Hofer Gilson & Lione. "It’s the tougher portion of the problem."

Erlandson has been selling the pencil, in one way or another, for a long time. He hopes Dixon some day will adopt the tag
line he wrote: "We never tire of helping the environment."