Month: June 2016

No matter how difficult your business is at times to manage, fundamentally, the waste business is really very simple. When you compare it to other businesses, our variables for success and failure are a relative small universe.  Consider a company like Apple Computer.  Not only do they have to market a superior product that works as expected, they also have to be on the leading edge of technological improvement.  Then there are the service issues and the army of customer and technical service representatives.  Don’t forget the ever-changing customer tastes.  There is a myriad of other factors that management must consider: foreign governments, currency exchange rates, security, activist groups and their investors, to name a few. In a waste hauling business, when you look at our revenues and expenses, we have fewer factors to manage: labor, trucks, containers and overhead. If your keep an eye on the major expense areas and use meaningful metrics, you should move from the larger crowd...

Over the years I have heard many thoughts on how much profit an independent waste company owner should put into a bid, or a customer’s quote. Some say “I determine my cost and mark it up 10%, 15% or 20%.” I have heard some owners who said they take their operating cost and double it to get to the profit level they want to see in their business. The worst case is by default: an owner prices at or below Local Larry’s Lowball Hauling Service, with no regard for their profitability, just to get or keep the business. With few exceptions a waste company owner’s largest asset is in their company. While they might have retirement accounts and investment accounts, their company could have an investment of debt, equity or both ranging from $2MM to perhaps $100MM, depending on the size of the company. When I look at some waste companies’ financial statements I see...