Most companies are overpaying on waste and recycling problems, and most companies also don’t do anything about it. Why? Because they don’t know they’re overpaying.
The waste industry has certain norms in how they operate. These norms ensure that rates go up year over year, and that you won’t have the time to find better rates before your contract automatically renews. They ensure that you won’t have much recourse when service issues arise and that you have the wrong service levels. They ensure that you overpay.
In this article, you’ll learn why these problems remain hidden (and why you likely have them).
These problems remain hidden because of three false assumptions:
You can’t make changes to a proposed contract.
Your stated service levels are accurate
Your waste hauler is being fair.
None of these things are necessarily true. We have great success negotiating contract terms. Most service levels are actually inaccurate (70% of our clients have received too many pick-ups). And your waste hauler isn’t always fair - particularly when it comes to price hikes.
Learn more about your waste problems here!
You CAN make changes to a proposed contract
If you remember nothing else about this post, remember this: you can ask for different terms than a standard waste contract. In fact, you absolutely should.
Most default waste contracts are set up to help your hauler:
Increase profits
Not be accountable for poor service issues
Retain your employment at the end of your contract.
You have to be proactive about putting specific language in your contract to make sure price hikes are limited and service provisions are provided. You’ll also need to make sure no auto-renewal clause occurs in the contract.
You should ask for the following inclusions on your contract:
Short terms (3 years - no more)
No automatic renewal
Limited price hikes
Provisions for poor service
No ancillary fees
If your hauler wants your business, they’re going to be willing to listen to some (if not all) of your requests. If they aren’t willing to work with you, you may be able to find another vendor in your area who will.
Your service levels ARE inaccurate
70% of our clients in the past 18 years have had inaccurate service levels. Why? Because many haulers are paid based on the frequency of service. The more pick-ups they complete, the more they’re paid. So when they set up your contract, they’re likely going to err on the side of too many pick-ups.
Your hauler is not often going to take the initiative to find cost-cutting solutions for you. They’re paid to pick up your trash, not reduce your waste spend. Doing so would run counter to their desire to make a profit.
Check your dumpster fill levels. If they’re consistently less than half full prior to pick-up, you’re paying for too many pick ups.
Your waste hauler ISN’T necessarily being fair
Your hauler isn’t going to tell you if they’re charging more than their competitor. They’re not going to tell you that they plan to raise your base rates twice in the next year. They’re not going to volunteer information that could cut into their bottom line.
They’re going to do what is typical in the waste industry. They’re going to hand you a contract to sign and assume that you won’t want to tweak any of it. They’re going to assume that you won’t carefully look over it and that if you do, you won’t want to make any changes.
It’s not necessarily because they’re out to get you - it’s simply because the industry has evolved this way because profits are paramount.
It would be fair of them to:
Agree to limit price spikes to a certain percentage -and timeframe.
Agree to cancel the contract without penalty if they can’t provide adequate serviced as agreed to.
Give you plenty of time to get bids of other service when your contract expires
But again, most haulers are not going to voluntarily do this.
The good news is that many of them will if you ask them to. Ask for what you want. The worse you can hear is a “no.”
Go in depth: learn more about hidden waste problems
We’ve created a free, comprehensive mini e-course for you to learn more about your waste problems. There are 5 ways you’re likely overpaying on waste expenses, and we go over every one of them in depth.
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