Franchise Waste Collection Areas
Many communities in California and Florida provide special challenges to organizations looking to reduce their waste disposal and recycling expenses. In fact, many organizations upon learning they are in a franchised market simply give up.
What is a Franchise Waste Collection Area?
Here is a compare and contrast I excerpted from Los Angeles:
Current Open-Market System
Solid waste collection services are provided through an open-market system in which each resident directly arranges for services with the hauler. Although many waste haulers are doing a good job, this system has been unable to meet demands created by changes in Federal and State laws, public attitudes toward protecting the environment, and consumers’ demands for better services and protection against excessive rate increases.
Proposed Franchise System
The new franchise system will provide residents with ways to dispose of solid waste in an environmentally-friendly way. Haulers selected to provide solid waste collection services are required to enter into a franchise agreement with the County based on specific terms and conditions. The agreements are based on services expressed by the community and are designed to improve customer service, increase accountability, promote cleaner neighborhoods, and regulate rates charged by haulers.
Benefits of Franchise System
The franchise system is designed to provide uniform service standards for haulers operating in each franchise area. The system provides each community with the flexibility needed to create services that will benefit area residents. These features are modified to reflect feedback received through survey cards, community meetings, and telephone calls. This interactive process allows the County to tailor each agreement to meet the needs voiced by each community. The franchise system also benefits the community by limiting the wear and tear on County streets, assists the County in meeting the State’s waste reduction mandate, and reduces the need for new landfills.
To me this definition is vague. Essentially franchise waste collection areas serve to reduce the number of garbage trucks driving around town and ensure a greater amount of compliance for the community.
What this means for an organization is that they have a difficult time negotiating rates because there is no competition. The rates have been determined by the local government. This is widely true, but not always. You have to make a few calls to double check.
Since most people’s idea of waste cost reduction is simply rate negotiations, you can see why they give up when confronted with a franchised market. However, waste reduction and recycling is still wide open and can provide a a big cost reduction.
Keep in mind that recycling rates are most often lower than waste disposal rates and recyling more can net you a win. Then there are other methods of reducing the frequency of pick ups that will drive down costs.
To be honest, these projects take some elbow grease and often busy managers never find the time to do their best. In short franchise markets are a great place to get a third party involved. OK, that’s a plug, but it’s the reality.
Waste Audits in the UK
Believe it or not, in the past 4 months Midas has gotten more than half a dozen inquires about waste audits and recycling consulting engagements from companies outside of the USA. The first was from Jordan, then Dubai, then Nigeria, where interestingly, I do have some business contacts. Sadly, Midas does not conduct waste audits outside of the US and Canada.
If you are in the UK, The Greenhouse provides businesses with tailored waste management programs to minimize their waste output and costs. Check them out. In 2008 their reveunes were over $8,000,000. The Greenhouse has a particularly interesting case study for a large carpet retailer where they utilize backhauling of recyclables. I say so because Midas has long considered backhauling to be the gold standard in recycling for chain retailers because it allows them to leverage their scale.
Commercial food scrap composting
San Francisco, long time metropolitan recycling leader in this country, let alone the globe recently passed a mandatory recycling ordinance. Residential and commercial building owners must sign up for recycling and composting services. San Francisco has already attained a 72% recycling rate and they’re going to go higher now – to 75%.
Essentially about one-third of landfilled material is recyclable. Tenants, both residential and commercial want to recycle, but the owners have been lagging.
Logistically, buildings have to supply three waste and recycling bins. One each for trash, recyclables and composting.
Results exceeded expectations…
Tim, Again, thank you for the excellent job you have done.
Initially, I had some reservations as to how you were going to achieve any substantial or worthwhile waste and recycling savings.
However, the results of your work exceeded my expectations and the expectations of my facilities director.
Please feel free to use me for a reference. I wish you continued success.
Kalman Wenig
CEO
Premier Care Centers, LLC
Warning: Waste Management Restructures Recycling Pricing
As if you weren’t battered by enough pass along costs already, Waste Management, the nation’s largest solid waste management company restructured it’s recycling pricing, passing more of it’s costs to end consumers.While I’d being doing it if I were CEO of Waste Management, it’s still a bitter pill to swallow.
What they’ve done is to install a minimum recycling processing fee. This protects Waste Management when the floor drops out on recycling commodity charges. Of course this has been the case in most recycling commodity markets in recent months.
Not satisfied with breaking even, they are also expecting a “fair return” on their capital with this move. What this mark up is, is unspecified.
Waste Management says it will still share a portion of any proceeds it makes from recycling sales, but don’t expect to see that until commidty prices recover. Even so, you need to be watchful of commodity prices and Waste Management to ensure they are making good on their word.
