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recycling-bins

Harsh Economic Climate Highlights Recycling’s Cost Cutting Potential

In tough economic times, business needs to see recycling as an effective cost cutting tool, not just a “good thing to do” with negligible financial benefit.

We’re all familiar with the idea that recycling is a good thing: we’re surrounded by high profile campaigns which encourage us to be green, opt for a sustainable future and recycle as much as possible.  For most people, recycling boxes, bins, biodegradable packaging, carbon footprints and alternative energy sources are a constant presence. As a society, it’s almost impossible to ignore the constant promotion of green issues encouraging us to think carefully about what we consume and how to dispose of it.

Many of these initiatives have been successful, particularly in the domestic market where the amount of recycling has increased year on year. The UK is now recycling around 35% of its domestic waste; up from 17% in 2004, but still far less than most European nations. However, up to 60% of everything that goes into a UK dustbin could still be recycled!

Businesses have also implemented many initiatives from relatively simple ideas such as printer cartridge recycling schemes, through to major strategies such as Marks & Spencer’s Plan A, which has 180 different environmental commitments and aims to make the high street chain, the world’s most sustainable major retailer by 2015.  Whilst business recycling is increasing, many organisations don’t appreciate – or take advantage of – the significant cost savings that recycling can provide.  Recycling is often viewed as something which is “good to do”, benefits the environment or raises money for charity – rather than being a cost cutting activity in its own right.

Until relatively recently, recycling has not been a priority for most UK businesses: often it has been viewed as not commercially beneficial. However, over the past five to ten years, this perception has been challenged by increasingly robust “green” legislation, such as 1997 WEEE directive of electronic waste recycling, as well as the dramatic (and ongoing) increases in Landfill Tax (up from £32 per tonne in 2008 to £56 per tonne in 2011). These, along with steady rises in Business Rates to cover local government’s rising waste disposal costs have resulted in many businesses looking far more closely at just how much their waste is costing. Additionally, in a difficult economic climate, businesses are under pressure to cut costs: they’re reviewing all their operations – and waste disposal is one area which can provide significant savings.

Given the economic climate, it’s time for business to take recycling far more seriously, because there are real savings to be made. Printer cartridges are a great example – each year, the UK puts more than 55 million cartridges into landfill, at huge cost due to collection charges, landfill tax and impact to the environment (each one takes 1000 years to decompose). Yet, there are many organisations who will collect, recycle and reuse them – and pay up to £12 for each cartridge.  Given the number of cartridges that an average business will use over a year, this can provide a significant saving. 

Around 58 billion cups from vending machines and coffee shops are thrown away (not recycled) each year – most of which find their way into landfill.  To address this, several of the vending machine and drinks companies have established cup recycling schemes; organisations are charged to participate in the schemes, but many find their fees are more than offset by reduced costs for commercial waste disposal.

Organisations looking to maximise the cost saving opportunities around waste disposal and recycling may find partnering with a specialist waste or facilities management company a highly effective option. As part of its plans to reduce costs and improve efficiency, Business Environment, the serviced office provider, identified recycling and improving waste disposal as opportunities to make significant cost savings. In 2010, the company implemented a series of initiatives across its 15 centres in London and the south east to recycle as much card, paper, food, consumables and general waste as possible.  Working with SWR, Business Environment which employs 287 people and with a turnover of £24million, is a medium sized company, but it has gained significant financial benefits from its recycling initiatives.  The company has cut its waste disposal cost by £3000 per month compared with last year.

Although we’ve implemented a relatively modest number of initiatives, we’ve certainly seen direct cost savings as a result” commented Steve Moore, BE’s marketing manager. “Across the business, we’ve saved over £35,000 in a year which goes straight to our bottom line, as well as helping us operate in an environmentally responsible way. With our serviced office centres now recycling between 74- 93%, we are confident this saving will grow significantly next year.  Given these savings, we plan to develop our recycling initiatives still further to gain even greater cost savings. We’re also now looking to get involved in London’s Barclays Cycle Hire scheme and local superhighway initiatives to help our clients’ cycle to work and around the City, which will save them money and help improve their health”.  

Business Environment is just one organisation which has looked more closely at recycling as a way of cutting costs. Given the current economic climate, maybe businesses will finally start to see that recycling is an effective way to cut costs – rather than a minor project with marginal impact.