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Selling trash for profit
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May 12, 1999: 2:51 p.m. ET
Companies find that going green can help put them in the black
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NEW YORK (CNNfn) - When it comes to running a successful business, the environment almost always takes a back seat to the bottom line.
But an increasing number of companies are finding that by going "green," they can put the brakes on excessive costs and drive profits higher.
More than $7 billion each year is spent on trash hauling in the United States, and for many businesses, garbage collection is a major expense, with pickup fees ranging from $32 to $60 per ton.
Americans generate in excess of 220 million tons of trash each year.
Many experts agree waste reduction is the most effective ways of achieving environmental goals.
But to get the perks that accompany a greener workplace, you may have to stop thinking of waste as trash.
Shifting gears
You would never throw away a handful of diamonds, but people are more than willing to dump bags of toner cartridges without a second thought.
But paper, glass, aluminum and plastic are all commodities, for which many organizations and companies may be willing to pay. By throwing them out, you could be trashing potential profits.
The markets for recyclables fluctuate drastically, as does the demand for individual materials. Paper, for instance, is highly valued, whereas plastic is not. Depending on the region and the season, recycling companies may be willing to pay anywhere from $30 to $140 for a ton of copy paper, but less than $4 for a ton of plastic.
Regardless of market demand, the hauling of recyclables is almost always less costly than that of other waste. So even if payment for recyclable goods is unavailable, it still may be worth a company's while to sort through its waste.
A few notable exceptions exist.
Because many small businesses rent offices or stores in shopping centers or larger buildings, they may not be paying for their trash hauling themselves. Consequently, a landlord may reap the benefits of any recycling program you put into place.
In addition, economies of scale come into play in trash hauling. A waste management company may be less likely to pick up your recyclables (or reduced trash load) if it is not large enough to justify the journey.
"Recycling can be expensive for small businesses," said Tom Watson, coordinator of the National Waste Prevention Coalition. "There are usually ways they can do it, but for some businesses it's unrealistic."
To get around these obstacles, try to convince your landlord to pass the savings on to you by reducing your rent or offering some other benefit. Consolidating recycling efforts with other tenants or neighboring businesses also may make recyclables more worth a trash hauler's while.
"You're always going to save money. The question is how much," said Jackie Roberts, director of the Alliance for Environmental Innovation at the Environmental Defense Fund. "You have to be in it for the long haul."
Reducing waste
The separation of recyclables from your other waste is only one way to lower expenses. Reducing the waste produced in the first place could generate even more cost savings.
Minimizing trash not only lowers disposal expenses, but can reduce the amount spent on office and other vital supplies.
Livingston, Ill.-based Bell Communications Research, which employs about 7,200 employees, estimates it saves about $30,000 a year in purchasing costs by encouraging the use of reusable mugs over disposable cups. The company saves an additional $1,000 per year by reusing interoffice envelopes as many as 39 times.
Initiatives like these can be replicated easily by smaller firms.
In addition to lowering costs, reducing waste through a company environmental program can boost both a company's image and employees' morale. An increasing number of studies show consumers consider a firm's environmental record when making purchasing decisions.
"If your company addresses these issues, it gives the impression you are well managed. It indirectly affects how customers perceive you," said Roberts.
Employees, too, have been found to be enthusiastic about office recycling programs. Heightened morale may translate into increased productivity.
Getting started
To initiate a waste reduction program in your company, an assessment of current habits and trends of the company will be necessary.
Conducting a walk-through of the facility, as well as a review of purchase records, can yield clues where waste can best be reduced.
A successful waste reduction program focuses on the areas where waste is the greatest. If the office only has one printer, recycling toner cartridges won't make much of a dent in costs. However, if dozens of soda cans hit the waste basket every day, an aluminum recycling program could greatly reduce disposal and hauling costs.
You also will want to see what products can be replaced with ones made of recycled materials. Many recycled products now match non-recycled counterparts in price and quality. By supporting these goods, you will help reduce waste and perhaps drive down the cost of recycled products further.
Employees are also a great resource. Because they are on the front lines of daily business tasks, they may be able to offer valuable insights into where waste is greatest. Involving staff members also may increase their sense of working toward a good cause.
Getting down to business
The average office worker uses about 10,000 sheets of copy paper a year, with U.S. businesses spending about $4 billion on copy paper annually. At up to $140 a ton, paper is also one of the most precious secondary materials.
Consequently, paper may be the most logical starting point for any waste reduction initiative. Paper waste is also among the easiest to limit.
Paper trash can be reduced by photocopying on both sides of sheets, making notepads from scrap paper, getting off junk mail lists and limiting your own mass mailing to clients who realistically may benefit from them.
Although the dream of the paperless office has long been abandoned, proper use of technology can greatly lower paper waste.
Send memos via email and send emails instead of faxes. Use smaller computer fonts, so more information fits on fewer sheets of paper. Store documents in a central networked place on a computer, so fewer hard copies need to be distributed.
E-mail and double-sided copies saved Applied Specialties, a small water treatment firm based in Avon Lake, Ohio, $320 a year and decreased its paper use by 500 pounds.
The use of durable, reusable products rather than single-use materials also can greatly reduce the amount of paper and other waste.
Using ceramic cups instead of paper ones, for example, or reusing office supplies, such as file folders and interoffice envelopes, can yield great results.
In addition, higher-cost, higher-quality durable items, such as manufacturing equipment or shipping containers, though more expensive, tend to break down less frequently and last longer. As a result, initial expenses often are offset by lower maintenance, disposal and replacement fees.
Better buying
Who you buy supplies from can also largely determine the amount of waste you produce. Many suppliers excessively package products in paper or plastic.
Start off by encouraging suppliers to offer products with reduced or minimal packaging. Choosing products that come in reusable packaging or that are offered in bulk quantities also can help cut waste.
Companies can examine packaging used for their own products too, to determine whether it is possible to ship merchandise in returnable or reusable containers or to use fewer layers of packaging material.
Bloomington, Ill.-based automotive insurance giant State Farm, for example, saves about $15,600 a year by shrink-wrapping a packaged set of forms, rather than individual forms, the way it used to.
Material exchanges are another great way to reduce waste. A materials exchange enables businesses to trade, sell or give away goods or materials that otherwise would become waste. (To find a material exchange near you, click here.)
Donating excess food, used furniture and other materials to local organizations -- such as homeless shelters, charities or schools -- also minimizes waste.
One company saved more than 50 percent of its regular disposal fees for food scraps by donating its cafeteria food waste to pig and cattle farmers.
The biggest mistake businesses make, environmentalists say, is believing their efforts don't matter.
"Apathy is a big problem. People think, 'I can't make a difference.' But there have been very tangible benefits on the environment," said the EDF's Roberts.
But she is quick to add: "We still have a long way to go."
-- by staff writer Nicole Jacoby
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