Your Hidden Waste Hauler Contract Problems: What they are and what you can do about them - Part 2
Most hauler contracts are written to ensure that haulers make money - and keep making more.
Typical hauler contracts:
Allow for unlimited price spikes
Have inaccurate service levels
Charges you for additional fees
Makes it nearly impossible to cancel
Has no provision for bad service
If your contract was not adjusted and has these default specifications, you will almost certainly pay more than you need to for your waste expenses.
Today, we’re going to talk about the last two contract specifications that cut into your bottom line.
Waste Contract is Nearly Impossible to Cancel
What’s worse than a bad contract? Being completely stuck in it.
There are two aspects of contracts that make them difficult to exit. First, most contracts automatically renew for long terms - usually five years. So you may realize you want to change your contract, but it can be almost impossible to do so if you are in the middle of a five year term.
Second, contract termination is de-incentivized since it typically includes hefty associated fees. On rare occasions, it may be worth it for your company to terminate their contract and pay the fee so that they can hire a cheaper (or more reliable) hauler. These fees are usually equal to the past six months of charges, which is likely no small amount.
If you do chose to terminate, you have to send a termination letter within a very specific time frame prior to your contact renewing. Most of the time, this termination letter has to arrive at your hauler no more than 180-90 days prior to your contract renewing.
You must send a certified letter - not an email - specifying that you are terminating the contract and/or cancelling the auto-renewal clause.
Cancelling the auto-renewal clause allows you to create a contract with the same vendor with more favorable terms.
Has no provision for bad service
When there are service issues, you should be able to get them resolved quickly and promptly.
When a hauler misses a pick-up, it should be easy to get in touch with them to resolve it. If they’re leaving stacks of garbage around the dumpsters or make a mess every time they service them, the hauler should only need one request to service more conscientiously. But this isn’t often the case.
Why pay someone for a service who is actually making your life (and your staff’s lives) more difficult? If you had multiple hauler problems with no resolution in sight, you need to know that you have an out if you need one.
A thorough contract will include steps for resolution - and what will happen if you continue to be dissatisfied with service levels.
You Don’t Have to Overpay for Waste Services
By default, your haulers are going to let these things happen to your contract. But you don’t have to let them. You can solve current problems and prevent new ones from happening - all it takes is effort, and some persistence.
We help companies across the nation find waste solutions and implement changes on their behalf. Don’t be part of the 95% of companies that are overspending on their waste disposal! Drop us a line to learn how you can fix your contract.
Your Hidden Waste Hauler Contract Problems: What they are and what you can do about them - Part 1
Most waste hauler contracts have hidden problems. Why? Because your haulers don’t have incentive to help you save.
And unfortunately, many vendors in the waste industry are out to make more and more profits. So they’re willing to have you sign contracts that help them do exact that. And many of you have unwittingly signed them.
A typical contract will include the following expensive specifications:
Allow for unlimited price spikes
Has inaccurate service levels
Charges you for additional fees
Makes it nearly impossible to cancel
Has no provision for bad service
Most people simply don’t know that they can ask for additional contract language. They don’t know that they can ask that certain clauses be removed. They don’t know they can edit existing language. So they don’t.
And as a result, they overspend by 10-30% on their waste every month.
This article will help you start saving on your waste expenses by identifying some of the most common contract problems. We’ll go over 1-3 today, and 4 and 5 later in the week.
(Psst! Want to quickly know how good your contract really is? Download our free Waste Hauler Scorecard!)
Price Spikes Allowed On Contract
This is a good example of a contract problem that requires additional language in order to fix. If your contract does not include language that prohibits or limits price hikes, you will almost certainly get them.
Price spikes can occur 1-4 times a year, at rates of 10-15% each time. Most haulers will only increase prices once a year, but some will chose to do so more. And if your contract doesn’t expressly prohibit this there’s nothing to stop them from taking advantage of the opportunity.
If price spikes compound over time, you will pay more than you should. If this happens at multiple properties in a portfolio, you can overpay by thousands of dollars. Don’t let that happen to you.
Take a look in the notes section in one of your contracts. Does it have notes that limit or completely eliminate price hikes? If not, scan the rest of your contract for any similar denotations.
You can read more about these waste issues and others right here.
Inaccurate Service Levels
Service levels tend to be “off” for two main reasons.
First, 70% of companies in the US are paying for too many pick-ups. Why? Because haulers err on the side of too many pickups since more pickups mean more revenue. The more trips to your property that they make, the more they get paid.
So when they’re first evaluating for your needed service levels, they have financial incentive to over-estimate your real needs. Some haulers do this intentionally. Others err on the side of too many pick-ups because too few pick-ups are going to cause major problems quickly.
Second, most haulers don’t tend to re-evaluate your real needs over time. When was the last time your hauler said they should drop service down to twice a week? Or that if you switch out equipment, you could have fewer pickups?
You may have had the correct service levels when your contract began, but your needs may have changed. There may be unnoticed savings opportunities at one or more of your properties because your services have not been thoroughly evaluated in a long, long time - or ever. (This is one of the major reasons why 90% of companies are paying too much for their waste services.)
Haulers simply don’t have the financial motivation to proactively find the solutions that are right for you. They’re there to pick up trash, and they know that more pickups means more revenue.
To make sure you have the right services, find an independent waste consultant who will objectively evaluate every waste stream and find where you’re currently overspending.
Contract Includes Additional Fees
Most haulers will pass on the cost any number of administrative and overage charges to you. A lot companies pay these outright because they think they have to. You don’t.
But unless your contract specifically caps or eliminates these fees, you will need to pay them.
Look for these on your current hauler contract:
Fuel/environment fees: This fee supposedly helps recoup the cost of gas, but is actually a huge profit center.
Recycling recovery fee: Covers the fees incurred by hauler to transfer recyclable, but again, is typically a profit center.
Minimum tonnage fees: Fee charged by the hauler (typically on roll-off or open-top accounts) when a container’s weight upon pickup is below a specific threshold.
Administrative fees: typically charged if a client elects to receive paper invoices instead of electronic delivery of invoices.
Regulatory Cost recovery fee: Some haulers, (like Waste Management) will charge this fee to cover costs in other regions - not necessarily yours. They explain it like this:
“This charge is not specifically tied to such costs to service your account, but instead helps us cover Waste Management’s enterprise-wide costs for host community fees, waste disposal taxes and similar charges to service all WM operating company customers in the United States and Canada, and to achieve an acceptable operating margin.” (From Waste Management, retrieved July 23, 2019.)
The regulatory cost recovery fee is not “tied to . . . your account.” In other words, you’re helping cover their costs to service other companies. Why should you pay for what you don’t benefit from?
You can reduce or eliminate all of these fees; you don’t have to pay them. But you have to do it prior to renewing a contract, or getting a new one. It’s extremely difficult to negotiate these fees in the middle of a contract.
Your Hidden Waste Problems are Costing You
Too many companies don’t realize how prices hikes, inaccurate service levels, and ancillary fees are costing them.
Price hikes are built into the fabric of the vast majority of waste contracts. Inaccurate service levels go unnoticed in most contracts. Ancillary fees are paid without question.
Take the time you need to take to carefully review your contract or contracts. You are likely sitting on significant savings.
Have you ever thoroughly reviewed your contract? Ever heard of any of these waste issues? Let me know in the comments below!
How Hauler Contracts Make You Overpay on Waste Expenses: Part 2
What if news broke tomorrow morning that you didn’t actually have to pay your mortgage? That somehow, a swanky lawyer somewhere figured out that most Americans were not actually obligated to pay their mortgage?
What if news broke tomorrow morning that you didn’t actually have to pay your mortgage? That somehow, a swanky lawyer somewhere figured out that most Americans were not actually obligated to pay their mortgage?
You’d probably be elated at first. But give it a day or two, and you’d probably start thinking, “Man, think of how much we could have saved if we had known this two years ago!”
At the risk of bursting your bubble, you definitely have to pay your mortgage this month. But you don’t necessarily have to be trapped into paying your hauler invoices.
Read Part 1 of this series here!
It’s all in what your contract stipulates. We’ve helped a lot of companies significantly reduce or completely eliminate their ancillary waste fees. You don’t have to include them on your contract, and if they’re not on your contract, you don’t have to pay them.
I’ll show you what I mean. Let’s look at some common contract fees that can be reduced or eliminated.
Your Hauler Invoice: Deconstructed
Take a look at your most recent hauler invoice. You’ll likely see a few fees listed near the bottom of your invoice, like this one.
You’ll notice there are three fees listed in the left hand column: a container service plan, a fuel/environmental charge and a regulatory cost recovery charge.
These are just three examples of waste fees that can be reduced or avoided altogether on your contract.
Pull out your most recent invoice, and see which of the following fees you’re being charged.
Want to stop overpaying? Download our free Guide to Reducing Your Waste Expenses!
The Most Common Waste Invoice Fees
There are dozens of waste fees that can appear on your invoices, but I’m going to focus on the ones you’re most likely to see.
Container Service Plan: This is a fee that was automatically added to most Waste Management Accounts a few years ago. Enrollment in this plan (involuntary though it may be) allows you to replace your container ev as necessary. But most people don’t need to replace their garbage container frequently - some of our customers have containers that over 5 years old and still look fine.
So do you really need to be a part of this plan? Probably not.
Container Refresh fee: This one is specific to one of the biggest haulers out there, Republic. Republic has a fee called a “Container Refresh” fee that allows the customer to get a no-cost swap out of their container every 2 years. Which sounds great - if your container gets rusted out, you can replace it for free.
But most containers are good for much longer than that. This is a good example of a service that seems like it’s there to serve you, but is actually in the haulers best interest. Haulers wouldn’t offer it if they didn’t profit from it. They know most of their customers will pay $10 a month for a service they will never use.
Fuel/environmental fee: Almost everyone gets this charge on their invoice. Basically, the hauler is charging you for the gas it takes to get to your site and deliver your trash to the dump. But here’s the thing - they charge everyone on their route a fuel fee. They are more than recouping the cost of gas.
And those fuel charges add up. The location that got the invoice above is being charged almost $60 a month, or $720 a year. Supposing this is a three year contract, that’s $2160 they could be saving!
Recycling recovery fee: This fee is charged by the hauler to transfer your recyclable material from your site to the drop off site. You may rightly ask, “Well, aren’t they charging me already for fuel? What exactly does this fee cover?” Herein lies the problem. This charge often isn’t actually covering anything - it’s just another fee that the haulers often tack on because they can.
Minimum tonnage fees: The hauler will charge you this fee when the containers weight is below a specific threshold. These fees typically only apply to roll-off or open-top accounts. In other words, they are charging you for not having enough garbage in the container.
Basically, when you incur this fee, the hauler is saying “I made up this rule, and you broke it, so you have to pay.” The dump site does not charge a minimum fee - this is just something the hauler makes up because, well, they can.
Psst! See all of our resources on how to stop overspending!
Administrative fees: Typically charged if a client elects to receive paper invoices instead of electronic delivery of invoices. Most of the time, this administrative fee is pretty small - less than ten dollars per month. But small does not equal fair! You shouldn’t pay a penny more than you need to on your waste disposal.
Regulatory Cost recovery fee: Some haulers, (like Waste Management) will charge this fee to cover costs in other regions - not necessarily yours. Your fees go towards paying other people’s garbage disposal.
You Don’t Have to Overpay on Contract Fees
The fees in the list above - and a whole lot more that we haven’t mentioned - are not required to be in your contract. Local and state governments don’t mandate these; they exist because your hauler wants to make more money.
If you aren’t interested in overpaying anymore, fill out our contact form! We’d love to hear from you. Or, let us know your thoughts in the comments below!
Free Download: "7 Ways You're Making Your Hauler Rich!"
Let me share a little secret with you: you’re almost certainly overpaying your waste hauler.
The industry isn’t designed to help you save. It’s designed to help your haulers make more and more money off you. In the past 20 years we’ve been in business, it’s something we’ve seen again and again.
So we distilled the most common way people overpay in this handy download, which can be yours for free with the click of a button!
Stop making the same waste mistakes over and over - for good!
Free Download: "7 Ways You're Making Your Hauler Rich!"
Let me share a little secret with you: you’re almost certainly overpaying your waste hauler.
The industry isn’t designed to help you save. It’s designed to help your haulers make more and more money off you. In the past 20 years we’ve been in business, it’s something we’ve seen again and again.
So we distilled the most common way people overpay in this handy download, which can be yours for free with the click of a button!
Stop making the same waste mistakes over and over - for good!
3 Steps to Getting an Airtight Valet Contract
What if I told you that ten minutes of your time could yield thousands of dollars in savings?
What if I told you that ten minutes of your time could yield thousands of dollars in savings?
Sounds crazy, right?
It’s not actually as crazy as it might seem. By spending just a little time evaluating the long-term efficacy of your valet service contract, you may very well find some ways to save.
Sound intimidating? It doesn’t have to be! We’ve broken it down step by step below for you.
The only thing between you and savings is time - and just a little bit of knowledge.
Let’s look at the process of evaluating your contract.
Know what a good one looks like (and a bad one!)
Evaluate contract specifics: service levels, service provisions, rate stipulations, and terms.
Figure out the next steps: renegotiate the contract or get a new provider.
Ready? Let’s dive in together!
Know What a Good Contract Looks Like
Most people don’t really know what a good contract includes. A good contract is one that has terms that are fair to the client as well as the vendor.
Good valet contracts:
Limit price spikes
Have accurate service levels
Are easy to cancel
Have provisions for poor service
If you have a good contract, a lot of your problems will be addressed before they even begin. A good contract can’t prevent issues, but they can give you immediate recourse.
A bad contract is, of course, less than ideal. It won’t protect you from increased charges. The service levels listed in it won’t reflect your actual needs, and the contract itself will be really, really difficult to cancel. And - you won’t have recourse for when your valet porters don’t service entire buildings. (Yes, this has really happened before!)
Evaluate your Contract
Pull out your contract - it’s likely just a few pages long. Take a look at the term length, your service levels, and your termination specifications.
Take a few moments and ask yourself these questions.
Are my service levels aligned with my needs?
Consider if your current service level is really what you need. Do you residents enjoy having their trash picked up three days a week? They might like having it picked up five days a week.
Are price hikes capped or eliminated?
If there isn’t language in your contract that wards off price spikes, you’ll almost definitely get them. A $20 increase here or there may not seem like much, but it’s vital to remember that increases accrue over time. $20 hikes over the term of a contract can result in thousands of dollars in overspending. And it can all be prevented by just a few lines in your contract!
Do my rates reflect the market value?
If your rates are too high, you may be getting overpriced services. You could likely be getting the same services for less - in some cases, much less! When we recommend switching valet services, we calculate your contract buyout fee versus the amount you’ll save with a cheaper service.
But having rates that are too low can be an issue, too! As I write this, we are in the middle of an issue with one of our valet providers. Their rates are below market prices - but their services leave something to be desired. So we’re bid to other providers. Paying bottom dollar isn’t ideal if you’re not receiving quality service.
Call around to a few other providers to get a feel for what they typically charge for their services.
How easy is it to get out of my contract?
Termination processes may differ from vendor to vendor, but many have a clause similar to this:
All that fine print boils down to this: to cancel the contract, the company that employs this vendor must send a written letter of termination via certified mail 90 days prior to the end of the term. It’s not as simple as walking away.
Are there provisions for poor service?
What will happen when a valet porter “forgets” to service entire buildings? Or when they leave a trail of garbage down the halls? You want to make sure that you have recourse if service issues happen. We typically recommend that you ask for an invoice credit if service doesn’t happen as it should. And if there are enough issues, you need to have grounds to terminate the contract.
Know What You Want to Change About Your Current Contract
Make a list of things you want to change about your current contract. Some of these things may include:
Service levels - the number of pick-ups made by the hauler per week
Term - the length of the contract
Fee Caps - language that limits or eliminates ancillary fees.
Auto-renewal - cancelling your auto renewal puts you in the driver’s seat when it comes to whom you entrust your valet services.
Now, prioritize that list. You have to be prepared to not get everything you want - especially if you’re trying to renegotiate in the middle of a term. Having clear top priorities will help you let smaller issues go, if need be.
Make Changes to Your Valet Contract
If you decide to make changes, you can go one of two routes:
Renegotiating Your Contract - Some companies don’t need to get out of their contract completely; they just need different terms or different service levels. Other companies may not financially be able to exit their contract. Either way, for a lot of companies, renegotiating their contract makes financial sense.
Finding a New Hauler/Getting a New Contract - Some companies, on the other hand, find that it makes more financial sense to exit their contract, and pay out for the remainder. If you find yourself in this spot, send out bids to other area haulers and see if someone else can provide better levels of services.
Make Sure Your Valet Contract Protects Your Interests
Go the extra mile with your contract, and you could see big returns. If you evaluate your current contract, determine to fix its gaps, and implement changes, you’re securing a better financial position for your company for years to come.
But you’re also doing more than that. You’re setting yourself up for peace of mind. So often, when things go wrong with a vendor or service provider, it’s because the right preventative measures weren’t put in place. When issues do arise, you have recourse.
Set yourself up for success! Take a look at your contract - and if you have any questions, don’t hesitate to get in touch!
What other questions do you have about valet contracts? Curious about their typical length? Not sure what changes you should make? Let me know what you’re thinking in the comments below!
Top Three Ways Multifamily Properties Can Save
How much could you save if you did these three things? Hundreds? Thousands?
The waste disposal at multi-family properties can be mind-numbingly complicated. There are so many locations - and often just as many haulers.
So we’ve compiled the top three ways that multifamily properties can save.
This is no simple list. These are actionable steps that we’ve taken at hundreds of properties nationwide. These three things have saved companies hundreds of thousands of dollars. So we know they work - and that they’ll work for you.
Here are the top three ways you can save are:
Get an airtight waste contract
Review your valet services
Do a utility audit
I can’t overstate how critical all three of these are to your bottom line. We typically save 20-40% on waste disposal expenses - when you add in utility audits, those savings can double.
We don’t want you to leave any savings opportunities on the table! Let’s take a deep dive into each of these ways to save.
Get an airtight waste contract
When it comes to your waste expenses, an airtight waste contract is the very best way to prevent overspending - and waste issues!
A good waste contract will:
Prevent price spikes
Have great service provisions
Prevent fee charges
Is easy to cancel
Has appropriate service levels
When you contract has these provisions, you’ll have recourse. When you find a price spike, you can successfully fight it - and get a credit. When your hauler starts charging ancillary fees, you can likewise get a credit. And if the quality of their service levels start dipping, you can keep them in line. (A bad contract can be such an expensive mistake!)
Your contract represents an enormous savings opportunity. Don’t overlook yours.
Review your valet waste services
Valet services are an often overlooked way to save. When we complete a waste audit for multi-family clients, we always look at the valet services.
Valet services is a fancy term for door-to-door trash pick-up. Valet service will pick up garbage bags outside the residents door and dispose of it for them. It’s a fantastic benefit to offer residents because, let’s face it, no one loves taking the trash out. But valet services are often overpriced!
Let me give you an example.
We recently worked with a multifamily developer/manager who offered valet services at their properties. The WCI Project Manager noticed that the price per unit seemed to be awfully high. We were able to introduce a new vendor who was able to save them $28,800/year at just 3 properties!
Make sure you’re not being overcharged for your valet waste services. They can be a huge profit center for valet companies - but you don’t have to fall victim to them.
Examine your contract, and get a feel for market rates. Reach out to other area multi-family residences and ask what they pay for valet services. This will give you a really good idea about whether your services are overcharging you.
(Or, reach out to us for a completely free waste audit! They make savings simple - and they’re guaranteed cash-flow positive.)
Complete a Utility Audit
As successful as most utility audits are, it’s surprising how few companies know about them!
Consider the odds of winning the lottery - typically, there’s a one in a million chance. But if you know that your odds were better, wouldn’t you go buy one? What if your odds were 80% or higher?
This is exactly the opportunity a utility audit offers you. We find savings on utilities 80% of the time - and if we don’t find anything, you’re not charged a dime. I like to tell people that our audits minimize your resources and maximize your savings potential.
How exactly? Our audits work: we typically find savings through tax exemptions, rate adjustments, and eliminating unused meters.
A utility audit is the best way to know that you’re taking advantage of every savings opportunity available to you.
Stop overspending today!
We typically find that multifamily property managers have problems they don’t even know about. These problems typically cost thousands of dollars every year. And most of them are completely avoidable.
Make sure your waste contract is airtight. Ensure it eliminates or regulated price spikes!
Make sure you’re getting fair pricing for valet services. This is a huge savings bucket that companies typically ignore.
Make sure your utilities are under control! So many companies nationwide overspend. And they don’t have to.
Our risk free waste and utilities audits are tailored to your industry and your time constraints.
Why not reach out today? We’d love to show you your unseen savings opportunities - and how you can start taking advantage of them!
Have you ever heard of a waste or utility audit? What other questions do you have about them? Let me know in the comments below!
Free Download: "7 Ways You're Making Your Hauler Rich!"
Let me share a little secret with you: you’re almost certainly overpaying your waste hauler.
The industry isn’t designed to help you save. It’s designed to help your haulers make more and more money off you. In the past 20 years we’ve been in business, it’s something we’ve seen again and again.
So we distilled the most common way people overpay in this handy download, which can be yours for free with the click of a button!
Stop making the same waste mistakes over and over - for good!
How Valet Services Overcharge You - And What to Do About It!
Let’s face it, no one likes taking out the trash, right?
In the past few years, valet services have become increasingly popular. No longer do multifamily residents have to haul their own trash to the dumpsters - they can just leave it outside their door! A valet employee collects it and disposes of it. Sounds dreamy, right?
Trash valet services are a fantastic amenity to offer to your residents. But they aren’t always fantastic when it comes to pricing.
As with so many other areas of the waste industry, vendors will often increase prices because they can - or charge fees way above market level!
How can you make sure this doesn’t happen to you?
In this post, we’ll go what valet services are, some ways you might be overcharged, and what you can do to prevent overspending.
Psst! Ever wonder why you should care about waste in the first place?
What exactly is Trash Valet Service?
Valet services are a really fancy way of saying “doorstep trash pick-up.” In most situations, it happens exactly as is described above. Residents leave trash outside their door, and a valet employee picks it up and disposes of it.
Different locations will have different frequency needs. Some will only offer valet waste once a week; others offer it every day during the week.
Most vendors will service your location at night so that your residents aren’t disturbed - and so they have time to place their trash outside their door.
How You’re Overcharged for Valet Waste Services
Your trash pick-up provider can be sneaky - just like waste haulers, unfortunately! In fact, valet services are one of the top ways that multi-family complexes overpay on their waste expenses.
Providers often overcharge you because they think they can. Most multi-family management companies don’t evaluate the valet invoices they receive, or they just don’t know how to ensure their contract is in their best interest.
What you don’t know can cost you hundreds or even thousands of dollars over time - but it doesn’t have to!
Your rates may suddenly increase. Every so often, you’ll see an uptick in the rates listed on your invoice. It can be as little as 5%, but it can also be much more. But even a 5% increase compacts over time! If you’re charged an extra $20 each month, during the term of your contract you may overpay by hundreds of dollars.
Rates can increase as much as 1-2 times a year! Your fees can raise whenever your vendor feels like it. Not all vendors will take advantage of this - but some undoubtedly will.
We recently worked with a multifamily developer/manager who offered valet services at their properties. The WCI Project Manager noticed that the price per unit seemed to be awfully high. We were able to introduce a new vendor who was able to save them $28,800/year at just 3 properties!
Rate increases compound over time. Before you know it, you may be significantly overpaying.
Because there’s so little information out there about valet services and how they do what they do, you may think it’s normal. Or even something that you should expect.
But just because everyone else is paying at these rates doesn’t mean you have to as well.
Make Your Waste Valet Contract Airtight
The two best ways to prevent overpaying? Get a feel for the market, and then evaluate your contract.
Find out:
What are other area trash valet services are charging? Get at least one or two estimates.
What are other area multi-family complexes being charged? Get in touch with a contact, or just make a cold call - you’d be surprised how far a friendly voice and cheerful attitude can get you!
Then, take a good hard look at your contract and answer the following questions:
Are price hikes capped or eliminated?
Are rates locked in?
How easy is it to get out of my contract?
Are there provisions for poor service?
It can be expensive to stay in a bad contract - or have continual service issues with no recourse!
In the end, you may need to weigh your options. If you have a terrible valet service provider who is not interested in lowering their prices, it may be worth it to break your contract and get a cheaper service provider.
Protect your bottom line!
Fix your valet contract, and you’ll not only prevent overspending - you’ll know how to budget for years to come because you’ll have fixed rates.
You can have peace of mind knowing that you’re not going to be trapped into paying outrageous prices. And you’ll have a contract to protect your best interests.
Don’t wait until a price spike hits to worry about your valet services!
Do you use valet services at your multi-family property? Thinking about getting them at some point in the future? Let me know your thoughts in the comments below!
5 Reasons You’re a Great Candidate for a Utility Audit
Who is the best candidate for an audit? Someone who is short on time - and sees the cost-reduction potential in an audit!
Most people don’t know they’re sitting on savings. What they do know is that they don’t really have the time or resources to find them.
We help companies champion their bottom lines through our exhaustive audits.
Let’s take a few minutes to examine five aspects that make you a great candidate for an audit.
You have:
Not evaluated your invoices in the past year
Multiple utility meters
Expense line items that you can’t explain to your fifth grader
Multiple telephone lines
Multiple locations
Sound familiar? If one of these rings true, you’re likely sitting on savings.
Your Hidden Waste Hauler Contract Problems: What they are and what you can do about them - Part 2
Most hauler contracts are written to ensure that haulers make money - and keep making more.
Typical hauler contracts:
Allow for unlimited price spikes
Have inaccurate service levels
Charges you for additional fees
Makes it nearly impossible to cancel
Has no provision for bad service
If your contract was not adjusted and has these default specifications, you will almost certainly pay more than you need to for your waste expenses.
Today, we’re going to talk about the last two contract specifications that cut into your bottom line.
Waste Contract is Nearly Impossible to Cancel
What’s worse than a bad contract? Being completely stuck in it.
There are two aspects of contracts that make them difficult to exit. First, most contracts automatically renew for long terms - usually five years. So you may realize you want to change your contract, but it can be almost impossible to do so if you are in the middle of a five year term.
Second, contract termination is de-incentivized since it typically includes hefty associated fees. On rare occasions, it may be worth it for your company to terminate their contract and pay the fee so that they can hire a cheaper (or more reliable) hauler. These fees are usually equal to the past six months of charges, which is likely no small amount.
If you do chose to terminate, you have to send a termination letter within a very specific time frame prior to your contact renewing. Most of the time, this termination letter has to arrive at your hauler no more than 180-90 days prior to your contract renewing.
You must send a certified letter - not an email - specifying that you are terminating the contract and/or cancelling the auto-renewal clause.
Cancelling the auto-renewal clause allows you to create a contract with the same vendor with more favorable terms.
Has no provision for bad service
When there are service issues, you should be able to get them resolved quickly and promptly.
When a hauler misses a pick-up, it should be easy to get in touch with them to resolve it. If they’re leaving stacks of garbage around the dumpsters or make a mess every time they service them, the hauler should only need one request to service more conscientiously. But this isn’t often the case.
Why pay someone for a service who is actually making your life (and your staff’s lives) more difficult? If you had multiple hauler problems with no resolution in sight, you need to know that you have an out if you need one.
A thorough contract will include steps for resolution - and what will happen if you continue to be dissatisfied with service levels.
You Don’t Have to Overpay for Waste Services
By default, your haulers are going to let these things happen to your contract. But you don’t have to let them. You can solve current problems and prevent new ones from happening - all it takes is effort, and some persistence.
We help companies across the nation find waste solutions and implement changes on their behalf. Don’t be part of the 95% of companies that are overspending on their waste disposal! Drop us a line to learn how you can fix your contract.
Your Hidden Waste Hauler Contract Problems: What they are and what you can do about them - Part 1
Most waste hauler contracts have hidden problems. Why? Because your haulers don’t have incentive to help you save.
And unfortunately, many vendors in the waste industry are out to make more and more profits. So they’re willing to have you sign contracts that help them do exact that. And many of you have unwittingly signed them.
A typical contract will include the following expensive specifications:
Allow for unlimited price spikes
Has inaccurate service levels
Charges you for additional fees
Makes it nearly impossible to cancel
Has no provision for bad service
Most people simply don’t know that they can ask for additional contract language. They don’t know that they can ask that certain clauses be removed. They don’t know they can edit existing language. So they don’t.
And as a result, they overspend by 10-30% on their waste every month.
This article will help you start saving on your waste expenses by identifying some of the most common contract problems. We’ll go over 1-3 today, and 4 and 5 later in the week.
(Psst! Want to quickly know how good your contract really is? Download our free Waste Hauler Scorecard!)
Price Spikes Allowed On Contract
This is a good example of a contract problem that requires additional language in order to fix. If your contract does not include language that prohibits or limits price hikes, you will almost certainly get them.
Price spikes can occur 1-4 times a year, at rates of 10-15% each time. Most haulers will only increase prices once a year, but some will chose to do so more. And if your contract doesn’t expressly prohibit this there’s nothing to stop them from taking advantage of the opportunity.
If price spikes compound over time, you will pay more than you should. If this happens at multiple properties in a portfolio, you can overpay by thousands of dollars. Don’t let that happen to you.
Take a look in the notes section in one of your contracts. Does it have notes that limit or completely eliminate price hikes? If not, scan the rest of your contract for any similar denotations.
You can read more about these waste issues and others right here.
Inaccurate Service Levels
Service levels tend to be “off” for two main reasons.
First, 70% of companies in the US are paying for too many pick-ups. Why? Because haulers err on the side of too many pickups since more pickups mean more revenue. The more trips to your property that they make, the more they get paid.
So when they’re first evaluating for your needed service levels, they have financial incentive to over-estimate your real needs. Some haulers do this intentionally. Others err on the side of too many pick-ups because too few pick-ups are going to cause major problems quickly.
Second, most haulers don’t tend to re-evaluate your real needs over time. When was the last time your hauler said they should drop service down to twice a week? Or that if you switch out equipment, you could have fewer pickups?
You may have had the correct service levels when your contract began, but your needs may have changed. There may be unnoticed savings opportunities at one or more of your properties because your services have not been thoroughly evaluated in a long, long time - or ever. (This is one of the major reasons why 90% of companies are paying too much for their waste services.)
Haulers simply don’t have the financial motivation to proactively find the solutions that are right for you. They’re there to pick up trash, and they know that more pickups means more revenue.
To make sure you have the right services, find an independent waste consultant who will objectively evaluate every waste stream and find where you’re currently overspending.
Contract Includes Additional Fees
Most haulers will pass on the cost any number of administrative and overage charges to you. A lot companies pay these outright because they think they have to. You don’t.
But unless your contract specifically caps or eliminates these fees, you will need to pay them.
Look for these on your current hauler contract:
Fuel/environment fees: This fee supposedly helps recoup the cost of gas, but is actually a huge profit center.
Recycling recovery fee: Covers the fees incurred by hauler to transfer recyclable, but again, is typically a profit center.
Minimum tonnage fees: Fee charged by the hauler (typically on roll-off or open-top accounts) when a container’s weight upon pickup is below a specific threshold.
Administrative fees: typically charged if a client elects to receive paper invoices instead of electronic delivery of invoices.
Regulatory Cost recovery fee: Some haulers, (like Waste Management) will charge this fee to cover costs in other regions - not necessarily yours. They explain it like this:
“This charge is not specifically tied to such costs to service your account, but instead helps us cover Waste Management’s enterprise-wide costs for host community fees, waste disposal taxes and similar charges to service all WM operating company customers in the United States and Canada, and to achieve an acceptable operating margin.” (From Waste Management, retrieved July 23, 2019.)
The regulatory cost recovery fee is not “tied to . . . your account.” In other words, you’re helping cover their costs to service other companies. Why should you pay for what you don’t benefit from?
You can reduce or eliminate all of these fees; you don’t have to pay them. But you have to do it prior to renewing a contract, or getting a new one. It’s extremely difficult to negotiate these fees in the middle of a contract.
Your Hidden Waste Problems are Costing You
Too many companies don’t realize how prices hikes, inaccurate service levels, and ancillary fees are costing them.
Price hikes are built into the fabric of the vast majority of waste contracts. Inaccurate service levels go unnoticed in most contracts. Ancillary fees are paid without question.
Take the time you need to take to carefully review your contract or contracts. You are likely sitting on significant savings.
Have you ever thoroughly reviewed your contract? Ever heard of any of these waste issues? Let me know in the comments below!
What would you do with an extra $12,000? This company found out!
Not too long ago, Anita Huffman got in touch with us. As the corporate director of a large manufacturing plant, Anita knew that there was a chance that they could be overspending on waste. They had several dumpsters and compactors on site, but they were also producing plastic byproducts that weren’t being sold.
When they got in touch with us, we explained that they would take on zero risk during our audit process. They wouldn’t pay us anything if we didn’t find savings.
We began the audit process in 2018 and we examined every waste stream that was available to them.
In the end, we found $12,000 worth of monthly savings!
Anita wrote us:
“My team and I were pleasantly surprised how much of a difference you made on our bottom line.
During your audit, you uncovered more than $12,000 in monthly savings opportunities. Your exhaustive process and your team’s dedication to our success has permanently changed our approach to waste management.
With your help, we’ve reduced our waste spend by thousands of dollars every year. We’ve decreased equipment inefficiencies, and we have service schedules that align with our production needs.
Your team has gone the extra mile, and we couldn’t be happier with the results.”
Anita were overspending on their waste and they had no idea! She and her team found out that they were unknowingly making some critical waste management errors. But now, thanks to our exhaustive audit, they’re saving.
Too many companies in the US are overspending on their waste and recycling expenses. You don’t have to be one of them! What could you do with the savings from a 10-30% reduction in waste?
Top Three Ways Multifamily Properties Can Save
How much could you save if you did these three things? Hundreds? Thousands?
The waste disposal at multi-family properties can be mind-numbingly complicated. There are so many locations - and often just as many haulers.
So we’ve compiled the top three ways that multifamily properties can save.
This is no simple list. These are actionable steps that we’ve taken at hundreds of properties nationwide. These three things have saved companies hundreds of thousands of dollars. So we know they work - and that they’ll work for you.
Here are the top three ways you can save are:
Get an airtight waste contract
Review your valet services
Do a utility audit
I can’t overstate how critical all three of these are to your bottom line. We typically save 20-40% on waste disposal expenses - when you add in utility audits, those savings can double.
We don’t want you to leave any savings opportunities on the table! Let’s take a deep dive into each of these ways to save.
Get an airtight waste contract
When it comes to your waste expenses, an airtight waste contract is the very best way to prevent overspending - and waste issues!
A good waste contract will:
Prevent price spikes
Have great service provisions
Prevent fee charges
Is easy to cancel
Has appropriate service levels
When you contract has these provisions, you’ll have recourse. When you find a price spike, you can successfully fight it - and get a credit. When your hauler starts charging ancillary fees, you can likewise get a credit. And if the quality of their service levels start dipping, you can keep them in line. (A bad contract can be such an expensive mistake!)
Your contract represents an enormous savings opportunity. Don’t overlook yours.
Review your valet waste services
Valet services are an often overlooked way to save. When we complete a waste audit for multi-family clients, we always look at the valet services.
Valet services is a fancy term for door-to-door trash pick-up. Valet service will pick up garbage bags outside the residents door and dispose of it for them. It’s a fantastic benefit to offer residents because, let’s face it, no one loves taking the trash out. But valet services are often overpriced!
Let me give you an example.
We recently worked with a multifamily developer/manager who offered valet services at their properties. The WCI Project Manager noticed that the price per unit seemed to be awfully high. We were able to introduce a new vendor who was able to save them $28,800/year at just 3 properties!
Make sure you’re not being overcharged for your valet waste services. They can be a huge profit center for valet companies - but you don’t have to fall victim to them.
Examine your contract, and get a feel for market rates. Reach out to other area multi-family residences and ask what they pay for valet services. This will give you a really good idea about whether your services are overcharging you.
(Or, reach out to us for a completely free waste audit! They make savings simple - and they’re guaranteed cash-flow positive.)
Complete a Utility Audit
As successful as most utility audits are, it’s surprising how few companies know about them!
Consider the odds of winning the lottery - typically, there’s a one in a million chance. But if you know that your odds were better, wouldn’t you go buy one? What if your odds were 80% or higher?
This is exactly the opportunity a utility audit offers you. We find savings on utilities 80% of the time - and if we don’t find anything, you’re not charged a dime. I like to tell people that our audits minimize your resources and maximize your savings potential.
How exactly? Our audits work: we typically find savings through tax exemptions, rate adjustments, and eliminating unused meters.
A utility audit is the best way to know that you’re taking advantage of every savings opportunity available to you.
Stop overspending today!
We typically find that multifamily property managers have problems they don’t even know about. These problems typically cost thousands of dollars every year. And most of them are completely avoidable.
Make sure your waste contract is airtight. Ensure it eliminates or regulated price spikes!
Make sure you’re getting fair pricing for valet services. This is a huge savings bucket that companies typically ignore.
Make sure your utilities are under control! So many companies nationwide overspend. And they don’t have to.
Our risk free waste and utilities audits are tailored to your industry and your time constraints.
Why not reach out today? We’d love to show you your unseen savings opportunities - and how you can start taking advantage of them!
Have you ever heard of a waste or utility audit? What other questions do you have about them? Let me know in the comments below!
5 Reasons Why You Should Overspend on Waste - Part 1
As strange as it sounds, there are in fact some solid reasons to overspend on waste.
But for the majority of companies nationwide (the actual number hovers in the 90% range), these reasons aren’t actually applicable. These reasons aren’t actually good reasons to overspend! Why would you chose not to save money? Most companies simply don’t realize they’re overspending.
There are 5 reasons why you should overspend on your waste and recycling disposal expenses.
You can afford to make your waste hauler rich
You love inefficiency.
You don’t like to delegate to experts.
You like having waste problems.
You like to ignore relevant data.
In this series, we’ll explore all the reasons you should keep overspending by 10-30% on your waste expenses. In this blog post (part 1 of a 2-part series), we’ll look at reasons 1-3.
You can afford to make your waste hauler rich
You may be one of the few companies out there who has excess funds. You may be flush with extra revenue, so how much you pay for waste services at all of your locations isn’t of concern to you. You may not have to worry about budget forecasts or balancing the books at the end of the month.
And if you do have excess funds, you may have already decided to allocate them to overpriced waste expenses. You can afford to spend whatever the waste companies charge you. (An aside: most hauler contracts are designed to allow indiscriminate price hikes, so most companies pay more than they should for expenses incurred over the term of their contract.)
Or, you may just enjoy overspending. Maybe you like the idea of helping your chosen waste vendor become rich. You may like helping them increase profits by paying extraneous fees. You may enjoy the sudden price hikes that add to their bottom line.
But chances are, this isn’t true.
You love waste service and equipment inefficiency.
You may love knowing that you’re likely one of the 70% of companies who are being over-serviced by their trash vendor. You may enjoy getting too many pick-ups every week at your locations. After all, who doesn’t love paying for services they don’t need?
These extra pick-up only benefit one person - and it’s not you. Your hauler is likely incentivized to make additional pickups because more pickups almost always mean more revenue. When was the last time you heard of a hauler voluntarily reducing their service frequency?
Additionally, you may like leaving equipment inefficiency to chance. You may be satisfied with inefficient waste and service levels. (50% of companies have too much or too little waste equipment.) You may prefer not to have an expert review your current waste management process for redundant equipment or ineffective waste equipment.
You don’t like to delegate to experts.
You may think you have the resources to complete your own waste review. And some people are able to complete a cursory review on their own! But most CEOs and COOs don’t have the expertise it takes to do their own waste analysis. Waste reviews are not simple processes to complete. It can be difficult to know where to begin, what exactly to assess, and how to assess your current process in general.
And if they do have the expertise, it’s likely they don’t have the time. We provide our clients the two things they need most - a professional waste assessment or review, but with very little demand for their time. (Our reviews are almost always 100% remote). We’ve been doing waste reviews for the past 18 years, and we know how to find your hidden waste problems and solve them - for good!
You can keep overspending on waste . . . but you don’t have to.
We provide our clients the two things they need most - a professional waste assessment or review, but with very little demand for their time. If you don’t mind having inefficient waste and recycling services and equipment, you’ll almost certainly keep overspending. And if you don’t want to take advantage of professional expertise, you can keep paying more than you need to for expenses.
But if these reasons aren’t true of you - if you value your resources and your time - then you can chose to stop overspending on waste expenses.
Are there other reasons to keep overspending on waste? Let me know in the comments below!
5 Reasons Why You Should Overspend on Waste - Part 1
As strange as it sounds, there are in fact some solid reasons to overspend on waste.
But for the majority of companies nationwide (the actual number hovers in the 90% range), these reasons aren’t actually applicable. These reasons aren’t actually good reasons to overspend! Why would you chose not to save money? Most companies simply don’t realize they’re overspending.
There are 5 reasons why you should overspend on your waste and recycling disposal expenses.
You can afford to make your waste hauler rich
You love inefficiency.
You don’t like to delegate to experts.
You like having waste problems.
You like to ignore relevant data.
In this series, we’ll explore all the reasons you should keep overspending by 10-30% on your waste expenses. In this blog post (part 1 of a 2-part series), we’ll look at reasons 1-3.
You can afford to make your waste hauler rich
You may be one of the few companies out there who has excess funds. You may be flush with extra revenue, so how much you pay for waste services at all of your locations isn’t of concern to you. You may not have to worry about budget forecasts or balancing the books at the end of the month.
And if you do have excess funds, you may have already decided to allocate them to overpriced waste expenses. You can afford to spend whatever the waste companies charge you. (An aside: most hauler contracts are designed to allow indiscriminate price hikes, so most companies pay more than they should for expenses incurred over the term of their contract.)
Or, you may just enjoy overspending. Maybe you like the idea of helping your chosen waste vendor become rich. You may like helping them increase profits by paying extraneous fees. You may enjoy the sudden price hikes that add to their bottom line.
But chances are, this isn’t true.
You love waste service and equipment inefficiency.
You may love knowing that you’re likely one of the 70% of companies who are being over-serviced by their trash vendor. You may enjoy getting too many pick-ups every week at your locations. After all, who doesn’t love paying for services they don’t need?
These extra pick-up only benefit one person - and it’s not you. Your hauler is likely incentivized to make additional pickups because more pickups almost always mean more revenue. When was the last time you heard of a hauler voluntarily reducing their service frequency?
Additionally, you may like leaving equipment inefficiency to chance. You may be satisfied with inefficient waste and service levels. (50% of companies have too much or too little waste equipment.) You may prefer not to have an expert review your current waste management process for redundant equipment or ineffective waste equipment.
You don’t like to delegate to experts.
You may think you have the resources to complete your own waste review. And some people are able to complete a cursory review on their own! But most CEOs and COOs don’t have the expertise it takes to do their own waste analysis. Waste reviews are not simple processes to complete. It can be difficult to know where to begin, what exactly to assess, and how to assess your current process in general.
And if they do have the expertise, it’s likely they don’t have the time. We provide our clients the two things they need most - a professional waste assessment or review, but with very little demand for their time. (Our reviews are almost always 100% remote). We’ve been doing waste reviews for the past 18 years, and we know how to find your hidden waste problems and solve them - for good!
You can keep overspending on waste . . . but you don’t have to.
We provide our clients the two things they need most - a professional waste assessment or review, but with very little demand for their time. If you don’t mind having inefficient waste and recycling services and equipment, you’ll almost certainly keep overspending. And if you don’t want to take advantage of professional expertise, you can keep paying more than you need to for expenses.
But if these reasons aren’t true of you - if you value your resources and your time - then you can chose to stop overspending on waste expenses.
Are there other reasons to keep overspending on waste? Let me know in the comments below!
How Valet Services Overcharge You - And What to Do About It!
Is your vendor overcharging you? How would you know if they were?
Let’s face it, no one likes taking out the trash, right?
In the past few years, valet services have become increasingly popular. No longer do multifamily residents have to haul their own trash to the dumpsters - they can just leave it outside their door! A valet employee collects it and disposes of it. Sounds dreamy, right?
Trash valet services are a fantastic amenity to offer to your residents. But they aren’t always fantastic when it comes to pricing.
As with so many other areas of the waste industry, vendors will often increase prices because they can - or charge fees way above market level!
How can you make sure this doesn’t happen to you?
In this post, we’ll go what valet services are, some ways you might be overcharged, and what you can do to prevent overspending.
Psst! Ever wonder why you should care about waste in the first place?
What exactly is Trash Valet Service?
Valet services are a really fancy way of saying “doorstep trash pick-up.” In most situations, it happens exactly as is described above. Residents leave trash outside their door, and a valet employee picks it up and disposes of it.
Different locations will have different frequency needs. Some will only offer valet waste once a week; others offer it every day during the week.
Most vendors will service your location at night so that your residents aren’t disturbed - and so they have time to place their trash outside their door.
How You’re Overcharged for Valet Waste Services
Your trash pick-up provider can be sneaky - just like waste haulers, unfortunately! In fact, valet services are one of the top ways that multi-family complexes overpay on their waste expenses.
Providers often overcharge you because they think they can. Most multi-family management companies don’t evaluate the valet invoices they receive, or they just don’t know how to ensure their contract is in their best interest.
What you don’t know can cost you hundreds or even thousands of dollars over time - but it doesn’t have to!
Your rates may suddenly increase. Every so often, you’ll see an uptick in the rates listed on your invoice. It can be as little as 5%, but it can also be much more. But even a 5% increase compacts over time! If you’re charged an extra $20 each month, during the term of your contract you may overpay by hundreds of dollars.
Rates can increase as much as 1-2 times a year! Your fees can raise whenever your vendor feels like it. Not all vendors will take advantage of this - but some undoubtedly will.
We recently worked with a multifamily developer/manager who offered valet services at their properties. The WCI Project Manager noticed that the price per unit seemed to be awfully high. We were able to introduce a new vendor who was able to save them $28,800/year at just 3 properties!
Rate increases compound over time. Before you know it, you may be significantly overpaying.
Because there’s so little information out there about valet services and how they do what they do, you may think it’s normal. Or even something that you should expect.
But just because everyone else is paying at these rates doesn’t mean you have to as well.
Make Your Waste Valet Contract Airtight
The two best ways to prevent overpaying? Get a feel for the market, and then evaluate your contract.
Find out:
What are other area trash valet services are charging? Get at least one or two estimates.
What are other area multi-family complexes being charged? Get in touch with a contact, or just make a cold call - you’d be surprised how far a friendly voice and cheerful attitude can get you!
Then, take a good hard look at your contract and answer the following questions:
Are price hikes capped or eliminated?
Are rates locked in?
How easy is it to get out of my contract?
Are there provisions for poor service?
It can be expensive to stay in a bad contract - or have continual service issues with no recourse!
In the end, you may need to weigh your options. If you have a terrible valet service provider who is not interested in lowering their prices, it may be worth it to break your contract and get a cheaper service provider.
Protect your bottom line!
Fix your valet contract, and you’ll not only prevent overspending - you’ll know how to budget for years to come because you’ll have fixed rates.
You can have peace of mind knowing that you’re not going to be trapped into paying outrageous prices. And you’ll have a contract to protect your best interests.
Don’t wait until a price spike hits to worry about your valet services!
Do you use valet services at your multi-family property? Thinking about getting them at some point in the future? Let me know your thoughts in the comments below!
Your Hidden Waste Hauler Contract Problems: What they are and what you can do about them - Part 2
Most hauler contracts are written to ensure that haulers make money - and keep making more.
Typical hauler contracts:
Allow for unlimited price spikes
Have inaccurate service levels
Charges you for additional fees
Makes it nearly impossible to cancel
Has no provision for bad service
If your contract was not adjusted and has these default specifications, you will almost certainly pay more than you need to for your waste expenses.
Today, we’re going to talk about the last two contract specifications that cut into your bottom line.
Waste Contract is Nearly Impossible to Cancel
What’s worse than a bad contract? Being completely stuck in it.
There are two aspects of contracts that make them difficult to exit. First, most contracts automatically renew for long terms - usually five years. So you may realize you want to change your contract, but it can be almost impossible to do so if you are in the middle of a five year term.
Second, contract termination is de-incentivized since it typically includes hefty associated fees. On rare occasions, it may be worth it for your company to terminate their contract and pay the fee so that they can hire a cheaper (or more reliable) hauler. These fees are usually equal to the past six months of charges, which is likely no small amount.
If you do chose to terminate, you have to send a termination letter within a very specific time frame prior to your contact renewing. Most of the time, this termination letter has to arrive at your hauler no more than 180-90 days prior to your contract renewing.
You must send a certified letter - not an email - specifying that you are terminating the contract and/or cancelling the auto-renewal clause.
Cancelling the auto-renewal clause allows you to create a contract with the same vendor with more favorable terms.
Has no provision for bad service
When there are service issues, you should be able to get them resolved quickly and promptly.
When a hauler misses a pick-up, it should be easy to get in touch with them to resolve it. If they’re leaving stacks of garbage around the dumpsters or make a mess every time they service them, the hauler should only need one request to service more conscientiously. But this isn’t often the case.
Why pay someone for a service who is actually making your life (and your staff’s lives) more difficult? If you had multiple hauler problems with no resolution in sight, you need to know that you have an out if you need one.
A thorough contract will include steps for resolution - and what will happen if you continue to be dissatisfied with service levels.
You Don’t Have to Overpay for Waste Services
By default, your haulers are going to let these things happen to your contract. But you don’t have to let them. You can solve current problems and prevent new ones from happening - all it takes is effort, and some persistence.
We help companies across the nation find waste solutions and implement changes on their behalf. Don’t be part of the 95% of companies that are overspending on their waste disposal! Drop us a line to learn how you can fix your contract.
How to Stop Overspending on Your Waste Disposal
Sometimes, it can seem like the waste industry is just one big headache. Contracts are difficult to get out of. Pick-ups are often late, or missed completely. Expensive haulers get away with being paid even more. Ultimately, you can end up overpaying by thousands of dollars as the years pass.
Your disposal services are likely not really serving you.
But you can fix that, starting today.
Sometimes it seems like the waste industry is just one big headache. Contracts are difficult to get out of. Pick-ups are often late, or missed completely. Expensive haulers get away with being paid even more. Ultimately, you can end up overpaying by thousands of dollars as the years pass.
Your disposal services are likely not really serving you.
But with some effort you can fix that, starting today.
Download our free Guide to Reducing Waste Expenses to help you get started!
To figure out how to stop overspending, you’ll need to
Review your waste process
Learn the ins and outs of your contract
Make strategic service changes
Monitor those changes
Think of these as the four keys to unlocking savings. 95% of businesses - across all industries - are overspending on waste services. It’s likely that you’re sitting on hundreds or thousands of dollars of waste savings. But use these four keys, and you can find them!
And since you’re likely to be short on time, this post boils it down to the essentials and will walk you through each step.
Reviewing Your Waste Process
You may be looking at your waste stream and thinking, “Where do I even begin?” I recommend that you start with finding support and go from there. Even if you have less than an hour a week to contribute to a review, it is completely doable if you build a team and assign tasks. Your team can support you through the review process.
Recruit colleagues. Having a team to support the review efforts will ensure accountability and effectiveness.
Pick a time frame. Take your team’s availability and scheduling issues at your locations.
Conduct the Basic Audit. Familiarize yourself with the details of your waste streams. Are your dumpsters always full when they are serviced? Do your haulers frequently miss pick-ups? You won’t know until you conduct a basic audit.
Review Your Contract. Pay special attention to key sections on your contract like: pricing, service levels, and terms. (Use the next section to help you know what to look for!)
Analyze findings. You may find that you need different equipment, or fewer pick-ups, or a new hauler.
Evaluate next steps. Now that you know what to fix, you can take steps to solve on-going issues. Get a new hauler and a contract with better terms. Or adjust frequency of pick-ups. All of these will affect your bottom line for years to come.
Learn about Your Waste Hauler Contract
Nobody except legal reads contracts, right? But I like to think of waste hauler contracts as maps - what they contain shows you how to navigate your waste process and find savings.
And don’t worry; you don’t have to read it end to end! Below, you’ll learn what sections of your contract to pay the most attention to.
Terms - This part of your contract discusses how long your contract is in effect. Most hauler contracts are 3-5 years in length. But you’ll also want to check and see how easy it is to get out of these terms. Is there a fee associated with terminating the contract? What options do you have? Answers to questions like these are critical for implementing long-term, ideal waste solutions.
Fees - Does your contract allow price spikes? How often can your hauler raise prices? An ideal contract will regulate or even eliminate price hikes.
Service - How often are your site(s) being serviced? You may not actually need as many pick-ups as you think! There is often a lot of savings to be had in reducing the number of pick-ups, or getting different size dumpsters - or both.
It may also be helpful for you to look over your past few hauler invoices. Do you notice any increases to regular fees? Are you paying for services that aren’t in your contract? If the answer is yes to either of these questions, you know you’re overspending!
Making Disposal Service and Waste Equipment Changes
Every company has at least three options to reduce waste expenses. Once you know your waste process and your hauler contract pretty well, you’ll be able to see where it’s possible for you to make changes.
Suppose, for instance, that you now know that your haulers fees have increased twice in the past year, and that there are other haulers in the area who could do the same service for less. This is valuable information! You could use it to renegotiate your contract with your current hauler, making sure it includes decreased service fees.
Every business is a little different, but at least one of these options will likely be the best one for yours.
Renegotiating Your Contract - Some companies don’t need to get out of their contract completely; they just need different terms or different service levels. Other companies may not financially be able to exit their contract. Either way, for a lot of companies, renegotiating their contract makes financial sense.
Finding a New Hauler/Getting a New Contract - Some companies, on the other hand, find that it makes more financial sense to exit their contract, and pay out for the remainder. If you find yourself in this spot, send out bids to other area haulers and see if someone else can provide better levels of services.
Getting New Equipment - Depending on your situation, getting different sizes of equipment can significantly reduce expenses related to waste equipment. If, for instance, you have two four-yard dumpsters that get picked up five times a week, you could upgrade to an eight-yard dumpsters that gets picked up three times a week - and save a nice sum each year as a result. (Learn more about different kinds of waste equipment!)
Monitoring Those Changes
Moving forward, you’ll want to make sure that the changes you’ve implemented are actually working. If you’ve gotten a different contract or a new hauler, you should see a difference in savings almost immediately. The same with equipment - the savings should be evident on the next month’s invoices.
But in order to make sure you’re getting the full effect of the your efforts, you’ll need to also monitor hauler invoices. We find that haulers make mistakes about 10% of the time - and that adds up fast! Make sure you know what you’re supposed to be charged, and make sure your billing reflects that.
It’s also worth it to periodically revisit your basic audit. Waste needs tend to change over time in every industry, so you want to be sure that you aren’t overlooking savings you could take advantage of.
You Don’t Have to Keep Overspending on Your Waste Disposal
With some effort and patience, you’ll see how waste savings can add up. If you carefully review your waste process, your contract and service levels, and make strategic choices, you can reign in overspending. But you can also find relief from waste worries - from price hikes, from awful service, and from terrible contracts.
You can take charge of your waste worries, and you can start today!
What questions do you have about your current waste management process? Let us know in the comments below, or shoot us an email.
Your Hidden Waste Hauler Contract Problems: What they are and what you can do about them - Part 1
Most waste hauler contracts have hidden problems. Why? Because your haulers don’t have incentive to help you save.
And unfortunately, many vendors in the waste industry are out to make more and more profits. So they’re willing to have you sign contracts that help them do exact that. And many of you have unwittingly signed them.
A typical contract will include the following expensive specifications:
Allow for unlimited price spikes
Has inaccurate service levels
Charges you for additional fees
Makes it nearly impossible to cancel
Has no provision for bad service
Most people simply don’t know that they can ask for additional contract language. They don’t know that they can ask that certain clauses be removed. They don’t know they can edit existing language. So they don’t.
And as a result, they overspend by 10-30% on their waste every month.
This article will help you start saving on your waste expenses by identifying some of the most common contract problems. We’ll go over 1-3 today, and 4 and 5 later in the week.
(Psst! Want to quickly know how good your contract really is? Download our free Waste Hauler Scorecard!)
Price Spikes Allowed On Contract
This is a good example of a contract problem that requires additional language in order to fix. If your contract does not include language that prohibits or limits price hikes, you will almost certainly get them.
Price spikes can occur 1-4 times a year, at rates of 10-15% each time. Most haulers will only increase prices once a year, but some will chose to do so more. And if your contract doesn’t expressly prohibit this there’s nothing to stop them from taking advantage of the opportunity.
If price spikes compound over time, you will pay more than you should. If this happens at multiple properties in a portfolio, you can overpay by thousands of dollars. Don’t let that happen to you.
Take a look in the notes section in one of your contracts. Does it have notes that limit or completely eliminate price hikes? If not, scan the rest of your contract for any similar denotations.
You can read more about these waste issues and others right here.
Inaccurate Service Levels
Service levels tend to be “off” for two main reasons.
First, 70% of companies in the US are paying for too many pick-ups. Why? Because haulers err on the side of too many pickups since more pickups mean more revenue. The more trips to your property that they make, the more they get paid.
So when they’re first evaluating for your needed service levels, they have financial incentive to over-estimate your real needs. Some haulers do this intentionally. Others err on the side of too many pick-ups because too few pick-ups are going to cause major problems quickly.
Second, most haulers don’t tend to re-evaluate your real needs over time. When was the last time your hauler said they should drop service down to twice a week? Or that if you switch out equipment, you could have fewer pickups?
You may have had the correct service levels when your contract began, but your needs may have changed. There may be unnoticed savings opportunities at one or more of your properties because your services have not been thoroughly evaluated in a long, long time - or ever. (This is one of the major reasons why 90% of companies are paying too much for their waste services.)
Haulers simply don’t have the financial motivation to proactively find the solutions that are right for you. They’re there to pick up trash, and they know that more pickups means more revenue.
To make sure you have the right services, find an independent waste consultant who will objectively evaluate every waste stream and find where you’re currently overspending.
Contract Includes Additional Fees
Most haulers will pass on the cost any number of administrative and overage charges to you. A lot companies pay these outright because they think they have to. You don’t.
But unless your contract specifically caps or eliminates these fees, you will need to pay them.
Look for these on your current hauler contract:
Fuel/environment fees: This fee supposedly helps recoup the cost of gas, but is actually a huge profit center.
Recycling recovery fee: Covers the fees incurred by hauler to transfer recyclable, but again, is typically a profit center.
Minimum tonnage fees: Fee charged by the hauler (typically on roll-off or open-top accounts) when a container’s weight upon pickup is below a specific threshold.
Administrative fees: typically charged if a client elects to receive paper invoices instead of electronic delivery of invoices.
Regulatory Cost recovery fee: Some haulers, (like Waste Management) will charge this fee to cover costs in other regions - not necessarily yours. They explain it like this:
“This charge is not specifically tied to such costs to service your account, but instead helps us cover Waste Management’s enterprise-wide costs for host community fees, waste disposal taxes and similar charges to service all WM operating company customers in the United States and Canada, and to achieve an acceptable operating margin.” (From Waste Management, retrieved July 23, 2019.)
The regulatory cost recovery fee is not “tied to . . . your account.” In other words, you’re helping cover their costs to service other companies. Why should you pay for what you don’t benefit from?
You can reduce or eliminate all of these fees; you don’t have to pay them. But you have to do it prior to renewing a contract, or getting a new one. It’s extremely difficult to negotiate these fees in the middle of a contract.
Your Hidden Waste Problems are Costing You
Too many companies don’t realize how prices hikes, inaccurate service levels, and ancillary fees are costing them.
Price hikes are built into the fabric of the vast majority of waste contracts. Inaccurate service levels go unnoticed in most contracts. Ancillary fees are paid without question.
Take the time you need to take to carefully review your contract or contracts. You are likely sitting on significant savings.
Have you ever thoroughly reviewed your contract? Ever heard of any of these waste issues? Let me know in the comments below!