Hauler Dances Competitive Twist

WW: What are the significant challenges facing your business?

EM: A number of private contractors in this area are concerned about our services being displaced by public sector operations. The threat of this reverse privatization lead to the introduction of new legislation in last year's General Assembly.

For example, House Bill 1802 gives any private hauler that is being displaced by a government operation, either a five-year notice or 12 months gross receipts. We would rather work with the re-gion's governing board, [The Southeastern Public Service Authority] on reasonable alternatives, but this certainly represents a threat to our businesses.

WW: Which areas do you see the most business growth potential?

EM: Interestingly, while a few communities are talking about taking back some of their solid waste services, others, like the cities of Richmond and Chesa-peake, were considering privatizing their residential collection. I think there's an opportunity for in-creasing our business in this area.

WW: Describe customer and safety training for your employees.

EM: Safety is very important in our business, so we have monthly safety meetings with our employees. We are also considering in-vesting in a safety incentive program, which would both educate and reward our employees for developing and keeping good safety habits.

WW: How have the volatile recyclables markets affected you?

EM: When you're hauling cardboard and prices have fallen from $200 a ton to almost nothing, we have to make a decision each week: Do we send the materials to a processor or do we process it ourselves?

The public has the wrong perception about recycling. They must understand that if they want recycling, they have to pay for it. Simply put, the cost of collecting the materials often outweighs its resale value.

I was at a pre-bid meeting for a local university recently, and they wanted money back from the hauler for the recyclables collected. The haulers at the meeting let them know that there's hardly enough money to pick it up, much less give some back.

WW: How has the industry changed since you joined Schau-bach?

EM: Recycling has probably changed our business more than anything else. And this area continues to develop and affect our operations. For example, in addition to residential recycling, our commercial customers are beginning to recycle.

It also used to be a simpler business, with a more level playing field. For example, everybody used to dump at the same place. Now, more private haulers have their own landfills.

Technology has changed our business considerably. We now have more tools to use, such as scales to evaluate our customers. When the landfill tip fee is $48 per ton, it doesn't take long for a heavy customer to hurt you.

Plus, we just purchased our second generation of computer software to help us optimize such things as billing and routing.

One thing that hasn't changed much, however, are the prices we charge our customers. Although our costs have gone up for the last decade, our pricing has remained relatively unaffected.