Even before the COVID-19 pandemic, retailers were feeling the pressure of shifts in consumer purchasing trends. Online shopping was already eating up a healthy portion of the market share, and adding in a quarantine didn’t help. With the holiday season in full swing, now is the time to work on pumping some life back into the margins that have been increasingly feeble through 2020 — and efficiency is the key.
Essentially, it boils down to this: waste less, spend less. The waste services that organizations use across locations are often seen simply as a cost of doing business, and minimal time is put into exploring the options associated with the vendors required to manage those waste streams. There are three steps retailers can take to make sure that their waste services and support vendors are helping them to cut costs.
1. Assess Your Current Waste
As much as operations have changed in the last 10 months, the amount of waste generated has changed along with them. With quarantine restrictions, stores are naturally producing less waste. If your current waste vendor isn’t monitoring these changes, you are paying to have half-full dumpsters emptied at the same frequency they had been before the pandemic hit. Taking the time to find out where your waste streams are generated is the best way to effectively reduce them.
2. Assess and Centralize Vendors
To truly get a handle on your waste services, you also need to evaluate your waste vendors. Depending on the infrastructure of your organization, you could have your waste services set up on a per-location basis, meaning two locations in the same town could potentially be using different service providers. Having a scattered vendor network opens you up to the potential for overspending that can be easily avoided. The time it takes to figure out if you’re overspending isn’t economically viable. Also, having multiple vendors for multiple locations severely impacts your buying power. One 100-location contract is priced very differently than 100 separate single-location contracts.
3. Vendor Consolidation
Having multiple vendors per location is almost guaranteed to be a source of overspending. The fewer vendors you have per location to handle things like trash, recycling and other waste streams, depending on the type of business you operate, the better your pricing is going to be. Having one consolidated provider to handle all of your location’s waste is the pinnacle of efficiency. The hours associated with managing a complete waste strategy for multiple locations across multiple states can often be the source of wasteful spending. Having as few service providers as possible to manage all of your services, invoices and continually working to increase savings is the foundation of a truly economically sustainable and efficient operation. It also gives you the ability to leverage buying power. A waste service provider that deals with hundreds or even thousands of vendors can extend their buying power to your stores in ways that your operation alone cannot. At the end of the day, the fewer waste service providers you use, the less money it takes to manage them.
An added benefit of having fewer service providers to your store’s waste streams is the ability to collect more accurate data. If you’re publishing a Corporate Sustainability Report or simply sharing information with your customers to build brand equity, you need to be able to show where you’re reducing environmental impact. The more vendors you have, the harder that critical data is to collect.
In these unprecedented times, efficiency is going to be the difference between the retail operations that fail and those that succeed. Taking the time to shore up your waste operations and service providers will automatically build efficiencies that directly affect your bottom line.
Ray Hatch is Quest Resource Management Group’s (NASDAQ: QRHC) CEO and a member of the board. He brings over 25 years of experience in both the waste management and food services industries that generated over a billion dollars in revenue. Previously, Hatch served as president of Merchants Market Group, an international foodservice distribution company. He also served in various executive roles with Oakleaf Waste Management, a provider of waste outsourcing that was acquired by Waste Management.