One of the most significant decisions you can make about waste disposal is whether you hire a waste consultant or a waste broker. This choice can effect your P&L, so it’s important to know the facts about each profession.
Consultants and brokers are similar, but there are some crucial differences. Let’s take a look at how these differences impact their relationship with you, their client.
Waste Disposal Review
Both consultants and brokers will conduct an initial review of the disposal needs at your locations. In this review, they compile basic information like the number of dumpsters, their size, and your current pick-up frequency.
Consultants are often much more expansive in their research and analysis, whereas brokers don’t tend to be as thorough. In fact, we find that brokers typically discover only about 10% of the possible savings at any given site.
Here at Waste Consultants Inc. (WCI) after we partner with a client, one of our project managers completes a free, exhaustive audit. They review the last 6-12 months of your invoices, copies of current contracts for haulers and recycling vendors, and may even do an on-site visit. The project manager then makes a list of expense reduction recommendations.
Waste Disposal Process Implementation
Brokers make waste management choices as seems best to them but consultants let you make these decisions. Consider the way brokers and consultants select haulers.
Brokers can choose haulers based on any number of variables, but the decision is up to them. They act as middlemen to set up hauler contracts on your behalf.
Here’s an example of one such contract. It lists terms and conditions, the number and type of waste containers, pick up frequency, and rates.
Brokers negotiate agreements like the one above. Their hauler selections may align with the needs of your locations, but they may not. And since a broker’s client has little oversight, it can be difficult to tell if their selections are truly in the best interest of that client.
Consultants, on the other hand, let you make the decision not just about which hauler to employ, but the frequency of pick-up, and the waste equipment you use. Our exhaustive audit lets us see where expense reduction methods can be implemented - but we never make those choices on your behalf. We give you all the information you need to make the best decision possible, then help you implement per your direction.
We often make recommendations like renegotiating service agreements, obtaining more efficient equipment, and increasing frequency control. This past spring, one of our manufacturing clients chose to implement these recommendations at all three of their locations. The client is now saving $12,000 a month in waste expenditures.
Waste Billing Processes
Brokers and consultants differ in how they are paid and in what their bills specify.
Brokers are paid regardless of the savings they find for you. Their broker fee remains the same if they find you $100 of monthly savings or $1000. As a result, many are not motivated to look for the maximum amount of waste reduction options for their client.
Consultants, on the other hand, are paid only when you save. We share in the profit with you only after you have implemented our recommendations. For most companies we work with, we typically share in the savings fifty-fifty.
If we don’t find savings after conducting our audit, you are not charged! This certainly happens on occasion, but for 90% of the businesses we work with, companies typically reduce their waste costs 20-40%.
But brokers and consultants also differ in billing transparency.
A broker will send you a monthly consolidated bill for all of your waste charges. This bill includes all expenses from the trash haulers who service your location or properties. It may or may not be itemized, but it will always include a hauler service fee.
For those with many properties in multiple cities or states, a consolidated bill can provide convenience. While they may be simpler to manage, they are not designed to show you price spikes or make mistakes easy to spot.
At WCI, we take a different approach. We audit all hauler invoices to ensure their accuracy and we also monitor them for unexplained price hikes. And each month, we also send you a savings summary sheet that itemizes your past and present waste expenditure. We want you to see exactly what is contributing to your monthly savings.
Summary
Consultants and brokers approach waste management from two different mindsets.
Waste brokers make decisions about your waste disposal process with little oversight. Their bills can make it difficult for you to tell what services you are paying for or if you even need all of those services.
Waste consultants, on the other hand, empower you to make the best disposal choices for your locations and are only paid when their recommendations impact your bottom line.
If you want a simple, single waste bill and are less concerned about waste management decisions, consider retaining a waste and recycling broker.
But if you value the ability to make informed decisions and having billing transparency, a waste consultant would likely be a great fit for you!
What other questions do you have about the differences between waste consultants and waste brokers? Let us know your thoughts in the comments below!