You don’t have time for solutions that don’t work.
Below, you’ll learn the top three things you can do today to reduce your waste expenses. These cost-cutting solutions are the same ones we routinely implement for our clients, so we know they work.
These three solutions are:
1. Find out if you have an auto-renewal clause on your contract
2. Find out if your terms are long.
3. Find out if your price hikes are capped.
Most companies we’ve worked with in the past 18 years have an auto-renewal clause, long terms, and no price hike caps. In fact, these are the default terms for most waste disposal and recycling contracts. So chances are you have them.
It can seem daunting to dive into your waste contract specifics, but we’re going to break it all down for you, step by step. By the end of this article, you’ll know if these three clauses appear on your contract and what you can do about it.
Read more about your waste problems here >>
So pull out your waste contract and let’s find your savings opportunities.
1. Find out if you have an auto-renewal clause on your contract
An auto-renewal clause is a language that specifies what happens upon contract expiration. Most waste hauler contracts will renew for terms of 1 year, but we’ve seen contracts that renew for an additional 5 year term!
If you have this clause on your contract, it’ll make you overpay. Most companies don’t track their contract expiration dates, and they don’t bid out for new services every few years. Your contract will renew without you knowing, and you’ll overpay because you didn’t have a chance to find less expensive vendors.
We always cancel the auto-renewal clause for our clients because it allows us to find the very best pricing and services that are available to them at the end of their contract. It saves them thousands of dollars in the long-term because we make sure they’re saving the most they can on waste services - every time, for every contract.
Check for your auto-renewal clause on your contract. Most of the time, they are on the second page under the “Terms” section and they look like this:
Many haulers will allow you to cancel your auto-renewal clause at any point in the contract. Call your hauler to find out today.
2. Find out if your terms are long.
Most waste hauler contracts are 5 years long. All the contracts we create for our clients are only 3 years long. This allows us to find the best pricing available at more frequent intervals. We want you to have as many opportunities as you can to take advantage of better pricing. Short terms allow us to help you do that.
It may be surprising that we can ask for terms that are shorter than the industry standard - and that we get them. But we find that most haulers are willing to agree to shorter terms. And this brings up a key principle when it comes to your contract: be willing to ask for what you want. You’ll may be surprised what your hauler agrees to.
There’s no mandate that says all waste contracts have to have terms of a certain period of time. Or that you have to have an auto-renewal clause, or that you can’t cap your price hikes. (Or that you have to be charged ancillary fees, for that matter!)
Your term lengths - and several of your other contract specifications - do not have to comply with industry norms. Ask for 3 year terms.
Again, short terms give you more opportunities to make sure you have the best pricing. You’ll be able to bid out for terms more frequently, so your waste disposal and recycling rates will be fair.
3. Find out if your price hikes are capped.
Your rates will climb if you don’t cap your price hikes to a certain percentage. Most haulers will charge you what they can. They plan on raising rates at least once over the next year, and your contract is going to let them do that - unless you have a clause specifying they can’t.
This is one of the most frequent ways we’ve seen people overpay in the past 18 years we’ve been in business. People assume that these rate increases are fair, and this is not usually the case. Haulers raise their rates because they can. Not necessarily because they need to.
Most price hikes are a 5-10% increase to your base waste rate. They can occur as often as four times a year, and there is no warning prior to their occurrence. When this occurs at one property, it can constitute a significant additional cost. When it occurs at multiple properties, it can be catastrophic.
Look for language like the following on the first page of your contract. This language will appear in the notes or comments section of your contract.
If you don’t find language to this effect, you’ll likely be subject to a price hike in the next year. You won’t be able to edit your contract mid-term to prevent these hikes, but you can add this language to future contracts like we do for all of our clients.
Sign up for our completely free e-course: “Your 5 Hidden Waste Problems”
If you’re like 90% of companies out there, it’s likely that you’ve found that your contract includes an auto-renewal clause, long terms, and no limits on price hikes.
These are just a few of the hidden waste problems that most people have. Learn more about these issues by enrolling in our completely free, comprehensive video course: “Your 5 Hidden Waste Problems.” Sign up below and we’ll send you the first video immediately - and include an additional downloadable PDF.