Managing Your Waste Costs

One of the certainties of running a business, other than taxes, is that there will be waste. Packaging, leftovers, litter--it all has to disposed of. At this time of year, waste takes on a higher profile because, every April, there is the inevitable increase in charges and this year has been no exception.

What has emerged though is that there seems to be no consistency in charges even between shops on the same Parade. Those amongst you with multiple outlets will have realised this yourselves but possibly never even queried it.

One of the weaknesses of the independent trade is the inability to secure national price structures for goods and services. This is an area exploited by all the national brands which gives their outlets a competitive edge when it comes to pricing. It's an unfair advantage which we are striving to remedy.

After some research, it has emerged that very few operators know--to the nearest 1 [pounds sterling] per bin--the true cost of having an 1,100 litre Euro bin emptied. It was assumed that the price was made up of three components: the bin emptying; the bin rental of 10p per day; and an annual administration fee of 50 [pounds sterling] per annum. It was also assumed that charges were not really negotiable. A further testimony to the inertia surrounding this area of the fast food business is the variance that operators pay to have their bins emptied. Incredibly, prices vary from 7 [pounds sterling] to as much as 14 [pounds sterling] per bin which, over a year, can be a difference of 364 [pounds sterling] for the same service. If you have two bins, or two collections, the difference is even more profound.

To get to grips with controlling costs, national companies often have their own in-house procurement and facilities departments who are expert in driving down costs. Intriguingly, many of them discovered that the best deals were not from councils, or the main waste haulage companies but from a waste broker.

What a waste broker does is look at all the rates in a given area from all the suppliers and, by using its national bargaining muscle, pass on huge savings to individual outlets which would not themselves have the clout to negotiate.

In many cases, such as those outlets already dealing with Cleanaway, the service provider need never change. A re-routing of the invoicing procedure simply passes on negotiated savings with the minimum of fuss. In some cases, an outlet may need to terminate its existing supplier but the savings are well worth the effort.

Fish & Chips and Fast Food talked to the waste broker which handles waste for national multiples such as Londis and Spar, plus both Domino's Pizza and KFC. It is a Bournemouth-based, but nationally operating, company called 1st Waste Management.

Working through its main waste partners--Biffa, Cleanaway, Onyx and Sita--it can cover most areas of the UK and lock in lower charges to its subscribers. With a few exceptions--the Isle of Wight, the Scottish Highlands and the occasional remote rural area--it is able to guarantee a rate of 6.25 [pounds sterling] per bin per empty. Other size bins and skips are available too.

In the current climate of rising landfill charges, plus speculation that waste disposal is a target for future taxation opportunities, it makes a lot of sense to examine your costs now and make sure you are not paying any more than you need.

For further information you can call 1st Waste management on 01202 393001 for a fax-back information form or email them on roy@1stwaste.co.uk