Scrappy ILT battles a dominant competitor

Reno-based International Lining Technology posted revenues of about $1 million last year, and expects to double the figure in 2004.

Its main rival, Houston-based Gundle/SLT Environmental, recorded sales of $274 million last year.

But Michael Salley, chief executive officer of International Lining Technology, doesn't doubt for a minute that his company will do just fine in this David-and-Goliath tale.

ILT installs geosynthetic linings essentially, huge sheets of specialized fabric to contain pollution at landfills, mines and other industrial sites.

Last year, the company installed 10 million square feet of linings at projects throughout North America.

In its twoyear history, it's worked with projects ranging from 16,000 square feet to 1.2 million square feet.

ILT's competitive edge? For jobs in the West, the lining material it imports from a manufacturer in Chile offers a significant cost advantage over materials shipped from U.S.

plants in the Southeast.

At the same time, however, the imported product sometimes is ILT's biggest headache, Salley says.

Competitors convince engineers or purchasing agents to include "Buy American" clauses in bid documents, and ILT is shut out.

When ILT isn't shut out, it can leverage the cost advantage from its Chilean supplier.

Materials usually account for about 70 percent of the cost of a linings contract, and the jobs the company chases usually amount to $500,000 or more.

But personal contacts in the business count for a lot, too, and Salley and company co-founder John Leon put substantial energy into maintaining the contacts they've developed during careers as project engineers for some of the geosynthetics industry's biggest companies.

"You start by building relationships," Salley says.

"That's the key to being successful getting people to trust you."

ILT bids on work across the United States, but it prefers working in the West where it can combine its cost advantage on materials with its ability to pull together a work force efficiently on its home turf.

Once it wins a contract, ILT mobilizes a force of about 30 workers many of them with a decade or more experience to roll out long stretches of protective materials and weld the edges shut.

Wind can raise havoc with a job.

So can wet weather.

A badly installed job may need to be replaced a financially crippling task if tons of landfill trash or mining wastes need to be moved from atop the geosynthetic material.

With its boom in mine development, Nevada is a key market for ILT as the company is called upon to provide linings that protect groundwater from mining wastes.

Landfills are another big piece of the market.

Late last year, for instance, ILT installed nearly 2 million square feet of material to cap a landfill at McCloud, Calif., in the shadow of Mount Shasta.

Salley credits much of the firm's early success to lessons he learned from the NxLevel course for entrepreneurs at the state's Small Business Development Center.

He says instructor Dick Stumbo provided enough of an edge to survive.

"In this business," he says, "it's so competitive that you have to be good."