ANALYSIS: Profit big by thinking small on food waste
Councils and waste contractors who look to supplement their existing food waste collection schemes with volumes from small catering and food service outlets could be sitting on a lucrative new business model.
The SME hospitality sector remains an untapped market for organic waste collections, with very low take-up in this field as many small and medium sized enterprises are not prepared to pay extra for separating out their food waste.
However, WRAP is currently examining the feasibility of co-collection models based around food and glass – these being the two chief waste streams from hospitality operations – and reckons there are rich pickings here for certain waste collection schemes.
According to WRAP’s head of collections & quality Linda Crichton, local authorities (or their sub-contractors) who already collect food waste from households and operate a trade waste collection scheme could quite easily start picking up more volume from the businesses they serve by diversifying.
“I feel there is an opportunity there … especially if there is also access to a nearby treatment facility such as in-vessel composting or anaerobic digestion as it will help to reduce overall costs for the customer,” she said.
Crichton, who was speaking at a conference on commercial waste in London yesterday (May 30), added that much of WRAP’s work in this area was focussed on providing better access to small firms by dovetailing with existing collection services from the public, private or third sector.
She argued that more flexibility and creativity was needed in packaging up tailored service models to make them more attractive to small businesses – and that this may require incentives in order to unlock feedstock potential.
It’s a view echoed by Dr Adam Read, who heads up the waste and resource efficiency arm of AEA Technology. Read has carried out a lot of evaluation in this field and says that food waste, along with paper and card, forms the lion’s share of the commercial materials stream.
In the absence of legislation in England and Wales, he argued that SMEs have “no real urgency to change”, but if they were offered more flexible collection services based on simplicity, speed and productivity then they might jump at the chance.
“[SMEs] don’t want to waste anything, they are all about the bottom line – so give them collection times that suit their business,” he maintained.
That said, there are several hurdles to negotiate. The first is that SMEs don’t feel food waste is a big enough issue for them as they feel the volumes they produce are relatively insignificant.
They also have concerns around the economics in separating out their food waste on-site and often only learn about new service options if their current waste supplier is minded to bring it to their attention.
On the flipside, many waste management companies find it difficult to introduce segregated food waste recycling collections.
“It can take up to 12 months to reach break-even point for a new segregated food waste collection scheme,” Dr Read said, adding that the cost of dedicated collection vehicles is often seen as a significant barrier to new entrants.
With the work WRAP is doing, which could also see more simplified SME collection schemes rolled out whereby ‘wet’ organic waste is co-collected alongside ‘dry’ recyclables, there may well be funding opportunities waiting in the wings for the waste sector to pilot new ways of working.
How this ties in with the forthcoming voluntary responsibility deal that Defra is due to release shortly for the hospitality sector remains to be seen, but it’s a certainty that food waste will be one of the key themes underpinning it.
And let’s not forget legislation as a last resort. Both England Wales would do well to look across the border to Scotland where new zero waste regulations will soon require businesses to segregate out materials for recycling – including food waste.