Delta Plastics CEO Dhu Thompson on Arkansas Naturally Being in the Middle of Manufacturing

Before buying Delta Plastics of the South in November 1996, Dhu Thompson had been in the banking industry for more than 18 years, most recently as vice president and head of private banking of Bank One in Monroe, La. Delta Plastics employs more than 275, and its sister company, Revolution Bag, employs more than 25.

Delta Plastics is a manufacturer of polyethylene irrigation tubing for the agricultural industry and is also the largest recycler of plastic in Arkansas, producing post-consumer resin for both internal use and other industries.

Thompson graduated from Northeast Louisiana University in Monroe with a bachelor’s in liberal arts. He’s also a graduate of Louisiana State University School of Banking in Baton Rouge.

Delta Plastics sells irrigation tubing and then recycles old tubing into postconsumer resin that can be used to make other products. How did you come up with this business plan?

When I acquired the company, it had been in existence for about three years. The vision of the people who started the company in 1993 was part of what we do today but not the full scope. The idea at the time was to make poly pipe, reclaim it, clean it, then extrude it and make a post-consumer resin (PCR). We then used that PCR resin to manufacture pipe at a lower cost. Currently, we still produce pipe and a quality PCR, which we use as part of our recipe in the manufacture of new pipe. The remaining PCR is sold to another company I have, Revolution Bag. Revolution Bag uses the PCR to make EPA-compliant trash bags for the janitorial and sanitation industry. These have a much smaller carbon footprint than other types of plastic bags because they’re manufactured out of recycled plastic.

There are indications that some manufacturing is returning to the U.S. because of labor and transportation costs and other factors. What’s your forecast for manufacturing in the U.S.? In Arkansas?

I can’t speak for all sectors but for plastics extrusion and recycling, the future of manufacturing in the U.S. and in Arkansas is very bright. Transportation cost limitations means that all recycling business is fundamentally regional. With the U.S. as a low-cost producer of natural gas and key plastic resins (and more capacity coming on line in the near term), U.S. plastics producers will benefit from proximity to supply sources. New technologies continue to drive big efficiency gains in recycling and plastic conversion markets. As a big consumer of plastic materials, the U.S. is on the front edge of the recycling wave. Given Arkansas’ central geographical location in the U.S. and its roots as a leader in environmental stewardship — “The Natural State” — Arkansas is poised to lead the way in recycling programs and opportunities.

What was your best business decision? Your worst?

My worst decision was to buy Delta, but the best was to stick with Delta. The first year I lost $1.4 million, the second I lost $600,000, but the third I actually broke even. There have always been significant challenges in this business. The bigger the “risk,” the bigger the “reward.”

Why is the environment so important to you and your company?

Conservation has long been a focal point in my personal life. I am chair of The Nature Conservancy, outdoor sportsman activities are a passion of mine, and my wife’s family is a multiple-generation farming family. Part of our mission statement is to “Preserve our environment for future generations,” which isn’t just a slogan but an operating philosophy for us. It is important for us to demonstrate that “green can be green”: Disciplined, creative operating models that focus on preserving our environment can create successful, growing enterprises as well.