The short version
- Grade inflation of one full grade is the most common supplier problem, and the easiest to measure.
- Undisclosed prior contents is the only one we treat as unrecoverable.
- Audit the first twenty units of any new supplier against their own description.
- A supplier who improves after being told is worth keeping; one who apologises and repeats is not.
Where our stock comes from
Roughly 62% of the containers that enter this yard come directly from the business that emptied them — a brewery, a blender, a packer, a grower. The rest comes through intermediaries: brokers who aggregate small lots, processors who handle other waste streams and pick up totes alongside, and a couple of larger reconditioners who sell us the stock that does not fit their programme.
The direct relationships almost never go wrong, because the person selling us the container is the person who filled it and they have every reason to be accurate. The intermediary channel is where the problems live, and this spring three of them stopped being worth the discount.
Supplier one: prior contents that were not what the paperwork said
A broker we had bought from for two years sent a lot of forty units described as having held food-grade glycerine. Nine of them arrived smelling distinctly of a solvent. Not subtly — you could smell it from the forklift.
We granulated all forty, which cost us about $2,300, and asked for the chain of custody. What came back was a spreadsheet that had clearly been assembled after the fact. The broker had bought a mixed lot, assumed the whole lot matched the majority, and passed that assumption on as a declaration.
This is the one category we treat as unrecoverable, and it is worth being clear about why. Everything downstream of us depends on the prior-contents record being true. If it is not, a food-grade tote we sell to a brewery is a container of unknown history with our name on it. There is no discount that makes that worth carrying.
Supplier two: grade inflation, measured
The second one is less dramatic and much more common. A processor in the Central Valley had been selling us stock described as Grade A. We graded every unit on arrival, as we do with everything, and after six months we had enough data to look at properly.
| Their stated grade | Units | Our grade: A | Our grade: B | Our grade: C | Scrap |
|---|---|---|---|---|---|
| Grade A | 214 | 61 | 118 | 29 | 6 |
| Grade B | 96 | 4 | 38 | 47 | 7 |
Only 29% of their Grade A was actually Grade A by our rubric, and 55% was a full grade lower. That is not fraud — grades are supplier-defined and their rubric was genuinely more generous than ours. But we were paying an A price for B stock, which meant our real cost per saleable A unit was about 31% higher than the invoice suggested.
We showed them the table. They offered to reprice, which was fair, and we negotiated for two months before concluding that the simpler answer was to buy from them at Grade B prices and stop pretending. When they would not do that, we stopped buying. No hard feelings, and we would work with them again on a B-priced basis tomorrow.
Supplier three: paperwork that would not survive an inspection
The third was a smaller operation collecting empties from agricultural sites. Their containers were fine. Their documentation on properly-emptied status under the RCRA empty-container rule was, charitably, informal.
This one we tried hard to fix, because the stock was good and the relationship was long. Priya spent two days with them building a rinse-record template and walking through what an inspector would actually ask for. They used it for about six weeks.
The reason this matters is that regulatory exposure travels with the container. If a container that held a regulated product arrives here improperly emptied, we are the ones holding it. Good intentions upstream do not appear on a manifest.
What we changed on our side
The uncomfortable part of all three stories is that the evidence was available early and we did not look hard enough. So the process changed rather than just the supplier list.
- Every new supplier now gets a formal first-twenty audit: we grade their first twenty units against their own stated grades and share the result with them before the second order.
- Grade concordance is tracked continuously per supplier, not reviewed when somebody gets a bad feeling.
- Any odour finding on an incoming lot now quarantines the whole lot rather than the individual unit, until the chain of custody is confirmed.
- Empty-container documentation is reviewed before the first collection is booked, not after the truck arrives.
If you sell containers to a reconditioner, or buy from one, the useful takeaway is the first item. Twenty units is enough to see everything, it costs almost nothing to check, and it turns a two-year problem into a two-week conversation.
Written by Marisol Trejo, founder & managing partner at IBC Totes San Francisco. Published May 2, 2024. Spotted something wrong? Tell us — we would rather fix it than defend it.