Throwing money away? Procurement Excellence in Waste Management

A complex web of local suppliers, multiple agreements on different supplier terms, poor visibility of waste stream volumes, lack of transparency around actual costs and rebates, issues with equipment and containers. Sound familiar? These are common challenges for organisations managing waste supply chains.

And in the supply market, prices for plastic, paper and card are at record highs due to the rise in e-commerce as a result of non-essential shops closing their doors, and raw material supply chains disrupted by lockdowns.

It is the perfect storm in both supply and demand and with increased regulation and business targets aligned to sustainability and CSR there is even more focus on effective and efficient waste management

This situation has created an opportunity for organisations to deeply reassess their waste management approach, optimise their supply chains and rework their commercials.

Summarised below are the key areas to address when looking to optimise your waste management supply chain.

Understand your costs/rebates/and additional charges – breakout the detail

The devil is in the detail! It’s not uncommon to see waste invoicing and reports with very little detail. At a minimum, your waste management suppliers should provide a breakdown of the following;

  • Waste streams (general waste, mixed recyclable, clean recyclables with a rebate value e.g., hard plastics, soft plastics, cardboard (baled, loose), to name a few examples
  • The weight of material collected and number of collections/lifts by waste stream
  • Costs per unit of weight and waste stream
  • Rebates per unit of weight and waste stream
  • Additional costs for equipment rental, contamination charges, account management, consumables etc

This information is essential to identify any hidden charges and benchmark against market information.

Understand your waste streams – segregate and treat waste appropriately to maximise commercial value and align with your sustainability strategy

Increases in landfill tax, energy consumption and costs to process general waste means it is the least desirable processing option. Segregation at source is key to optimising waste management. Using the Waste Hierarchy concept will help leaders consider waste disposal solutions and drive the most sustainable processing option and reduce processing costs.

Assess your container and equipment management

Understand your equipment and container landscape including.

  • Ownership – leased, rented, owned
  • Is the equipment optimised for the collection volume, site restrictions, space, and waste type?

This is especially relevant for organisation with multiple sites. Implement a robust policy on container and equipment management to avoid lengthy rental periods for old or unsuitable equipment. Equipment type will have a fundamental impact on lift costs and maximising your organisations cost per lift.

Maximise segregation of valuable recyclable material

According to LetsRecycle.com the price for UK domestic mills for old KLS (cardboard) was between £10-£20 per tonne in January 2020. Fast forward to August 2021 and pricing has increased to between £125-£143 per tonne. The market dynamics outlined at the beginning of this report continue and this pricing trend is common across plastics, metals and organic food waste suitable for anaerobic digestion feedstock.

In Summary

There are several options to consider when review your waste management supply chain and although complex, there are commercial, and sustainability benefits available to procurement and sustainability leaders.

If you would like to discuss, find out more details or understand our recent work in this area, we’d welcome the opportunity to discuss your individual challenges.

 

For further information or to discuss how Procura could help your organisation – please get in touch:

Email us: info@procuraconsulting.com

Call us: +44 (0)203 693 7275

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