Now is the time to seize the moment, embrace technological advancements, and partner with a telematics provider that understands what needs to be done to drive the waste and recycling industry forward.
By Erin Gilchrist
Inflation has a ripple effect across all aspects of the waste and recycling industry, from operational costs to profitability. Fleet managers must navigate rising fuel, labor, and equipment expenses while delivering essential services to their communities. And the impact is felt on every level, from fleet managers to customers. As a result of a 0.2 percent increase in seasonally adjusted inflation in March 2023, collection prices inevitably rose and affected the industry in several ways.
Increased Fuel Costs
Inflation often drives up fuel prices, making it more expensive to operate vehicles on a day-to-day basis. Waste collection vehicles, which typically run on diesel or other fuels, consume large amounts of fuel as they perform their routes. When fuel prices spike, fleet managers must either absorb these increased costs or find ways to offset them, such as optimizing routes, reducing idling times, or cutting services.
Rising Vehicle and Maintenance Costs
Due to inflationary pressures on raw materials, manufacturing, and supply chains, the price of new trucks and replacement parts can increase. As maintenance and repair costs increase, companies often must decide between investing in costly repairs or delaying them, leading to breakdowns and disruptions in service.
Higher Labor Costs
The labor market is also affected by inflation, as wages tend to rise in response to the increasing cost of living. Waste and recycling companies may need to pay more to attract and retain qualified drivers, mechanics, and other personnel. This can strain budgets further, particularly if corresponding increases in service fees or efficiency improvements do not offset the increased labor costs.
Increased Costs for Materials and Equipment
The industry relies heavily on equipment like compactors, balers, and sorting machines. Inflation and supply chain disruptions tend to go hand-in-hand, so a delay in the delivery of certain parts can raise the prices of these machines, spare parts, and consumables. For companies that recycle materials like metals, plastics, and paper, the cost of raw materials can also fluctuate, impacting profitability.
Rising Insurance Premiums
Fleet managers in the waste and recycling industry face higher insurance premiums as inflation affects the cost of claims, vehicle repairs, and legal fees. Waste management is a high-risk industry due to the nature of the work, so any increase in insurance premiums can dramatically impact the operational budget and quality of work.
Budgetary Flexibility for Better Solutions
These are not the only challenges waste management fleets face, but one complexity in particular can be deemed a problem and the solution. During periods of high inflation, it can be difficult for waste and recycling companies to make long-term investments in new technologies or fleet upgrades, such as telematics systems. However, as inflation begins to ease, it leaves fleet managers with more flexible budgets to make these important technological investments to enhance operations. That said, the ongoing challenge will be to balance these rising costs while maintaining efficiency and meeting regulatory standards.
Inflation drives up expenses, leading many companies to stretch the lifecycle of their vehicles and telematics systems, opting to 鈥渕ake do鈥� with existing tools rather than upgrading to more advanced solutions. As the financial pressures ease and budgetary flexibility increases, fleet managers now find themselves in an optimal position to make strategic decisions about their technology investments for the future.
Telematics solutions have become more sophisticated, offering waste and recycling fleets real-time data insights that enhance safety, optimize route efficiency, and reduce fuel consumption. Now is the perfect time to reassess the available technology and find a telematics partner capable of delivering long-term value by evolving with the fleet鈥檚 needs rather than offering a one-size-fits-all solution.
The Power of a Telematics Partner
Routes in waste and recycling can be unpredictable, and regulations are stringent. A robust telematics solution is more than just a tool鈥攊t is a strategic partner. Unlike other industries, the unique challenges faced by waste and recycling fleets demand a provider who understands the technology and the industry鈥檚 intricacies. An effective telematics partner will:
鈥� Offer Tailored Solutions: By working closely with a fleet manager鈥檚 team, they will develop custom KPIs that track metrics relevant to their specific operations, such as fuel efficiency, idling time, and route adherence.
鈥� Drive Efficiency and Reduce Costs: Leveraging data-driven insights, fleet managers can optimize routes, minimize fuel consumption, and identify areas for improvement, leading to tangible cost savings.
鈥� Ensure Regulatory Compliance: Navigating the complex web of environmental and safety regulations is crucial. A specialized telematics partner can help automate compliance processes, ensuring adherence to industry standards.
鈥� Provide Real-Time Visibility: One of the greatest benefits of modern telematics systems is the ability to collect and analyze real-time data. With advanced tracking capabilities, fleets gain real-time visibility into their fleet operations, enabling proactive decision-making and addressing issues promptly.
Safer Roads, Smarter Driving: Tech for a Safer Tomorrow
Safety is a common staple in every industry and is no exception in the waste and recycling industry, where drivers face a variety of hazards on the road and job sites. Advanced telematics systems track vehicle location and monitor driver performance, helping managers to identify risky behaviors that could lead to accidents. Telematics tools provide data on speeding, sudden stops, and other dangerous driving habits, allowing fleet managers to implement targeted training programs to reduce risks for specific drivers.
Compliance is another critical area where telematics can make a difference. Waste and recycling companies are subject to stringent environmental regulations, and maintaining compliance requires rigorous record-keeping for vehicle inspections, emissions, and driver certifications. The right telematics system can automate much of this process, ensuring that fleets stay compliant with local, state, and federal regulations without the burden of manual tracking.
From Waste to Energy: Seizing the Moment for Technological Advancement
With inflation easing, waste and recycling fleet managers are in a unique position to rethink their tech strategies and invest in telematics solutions that were once too costly. By leveraging this economic window, fleet managers can choose telematics partners that offer more than just a tool鈥攖hey provide the expertise, support, and flexibility needed to optimize operations, enhance safety, and reduce costs.
The right telematics partner will help waste and recycling fleets navigate the road ahead confidently, ensuring that they are equipped to meet current and future challenges. Now is the time to seize the moment, embrace technological advancements, and partner with a telematics provider that understands what needs to be done to drive the waste and recycling industry forward. | WA
Erin Gilchrist, VP of Fleet Evangelism at IntelliShift, brings 15 years of experience from Safelite AutoGlass, where she managed a fleet of more than 8,500 vehicles. A long-term member of the Automotive Fleet Leasing Association, she advocates for fleet leaders through her podcast, Straight Talk on Fleet. Passionate about fleet management, education, safety, innovation, and sustainability, she remains active in the industry, serving as a supplier and strategic partner. Erin can be reached through LinkedIn at .
References
www.bls.gov/news.release/cpi.t02.htm
www.epa.gov/regulatory-information-topic/regulatory-and-guidance-information-topic-waste