Waste Management Services

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 18,700 waste management companies in the US provide hazardous and nonhazardous waste collection, hauling, and treatment; operation of transfer stations and landfills; septic system pumping; and remediation including specialized cleanup of contaminated buildings, mine sites, soil, or ground water. About 66% of industry sales receipts come from services to businesses, organizations, and farms; 19% to residences; and 15% to government.

Worker Injury

Workers are exposed to a wide variety of risks including contact with contaminated and hazardous materials in trash and remediation sites, working with heavy machinery, and handling curbside trash bins near traffic.

Vertical Integration

Waste management companies are using vertical integration to control their waste streams, broaden services, cut costs, and improve profitability.

Industry size & Structure

The average waste management company operates out of a single location, employs 23-24 workers, and generates about $5-6 million annually.

    • The waste management industry consists of about 18,700 firms that employ about 445,700 workers and generate about $110 billion annually.
    • Average revenue per employee is about $246,000.
    • The industry is concentrated at the top with the four largest firms controlling 29% of revenue. Otherwise, the industry is fragmented with many companies offering one or a few types of waste services.
    • Major US companies include Waste Management, Republic Services, WCA Waste, and Stericycle.
                                      Industry Forecast
                                      Waste Management Services Industry Growth
                                      Source: Vertical IQ and Inforum

                                      Recent Developments

                                      Nov 29, 2022 - Falling Recyclables Prices Ding Waste Firms’ Revenue
                                      • Many of the largest waste-hauling firms saw their recycling-related third-quarter revenues decline amid lower commodity prices for several types of recyclable materials. Republic Service’s recycling revenue declined 27% in Q3 2022 compared to the same period in 2021, and Waste Connections’ recycling segment saw a drop of 17%. Recycling revenue at GFL Environmental dropped 14%, and Waste Management’s recycling operations were down 9%. Weaker revenues were primarily due to lower prices for old corrugated containers (OCC), plastics, mixed paper, and aluminum. Some waste firm executives suggested recycling revenues were likely to worsen in the fourth quarter as the global economy shows signs of slowing.
                                      • Recycled commodity markets are increasingly uncertain due to inflation and rising interest rates, according to the Institute of Scrap Recycling Industries. Reduced demand for recovered fiber exports has caused US mixed paper and OCC inventories to build, reducing prices. Demand for OCC has also fallen as the e-commerce boom of earlier in the pandemic has cooled. Industry watchers doubt that fiber demand will get much of a boost from the holiday season as more consumers continue the shift back to in-store shopping. According to Bloomberg, many shoppers are expected to dial back their spending this holiday season, which would reduce demand for packaging used in shipping goods.
                                      • A growing number of cities around the world are adopting “zero waste” policies and processing systems to reduce emissions and prepare for regulation. The waste sector represents 20% of global methane emissions and 3.3% of greenhouse gas emissions. Improved waste management policies including waste separation, recycling, and composting could reduce sector emissions by 1.4 billion tons per year, according to the Global Alliance for Incinerator Alternatives (GAIA). Greater volumes of recovered and recycled materials also reduce manufacturers’ emissions because recycled material generally requires less processing and energy to reuse. The United Nations Climate Change Conference (COP 27) is taking place in November and will address waste management practices and goals.
                                      • According to a recent report by the Solid Waste Association of North America (SWANA), waste haulers may want to hold off on making investments in electric refuse trucks. Electric vehicles (EVs) configured for waste hauling have only been in service for about 10 years. SWANA contends there is insufficient real-world performance and cost data from ongoing demonstration projects to support the high upfront capital outlays required to deploy refuse EVs at scale. SWANA suggests waste fleets continue to rely on diesel and compressed natural gas and switch to renewable forms of those fuels when it’s cost-effective to do so. According to SWANA estimates, a new refuse EV can cost $500,000, and charging stations can be $35,000. A diesel truck is between $300,000 and $350,000. Assuming $24,000 in annual fuel savings, it would take more than nine years for an electric truck to pay for itself.
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