A Terrible Product to Waste

About two-thirds of U.S. distributors claim their average profit margin on waste receptacles is between 20 and 40 percent , according to a recent survey conducted by Sanitary Maintenance magazine.

Waste receptacles can be a significant investment for customers, and with such healthy profit margins distributors can’t afford to overlook the market.

Participants in the survey responded to a wide range of questions related to selling demographics, buyer motivation, new product lines and preferred materials.

The feedback revealed that the waste receptacle industry is vibrant, but also steady, and that there are more opportunities for distributors to explore. For example, only 4 percent of those surveyed said they focus on selling outdoor waste receptacles. While indoor receptacles are smaller and easier to sell, outdoor receptacles offer a great financial return for distributors.

Given the economy’s fragile state, it’s good to know that there are some constants. One of them is that Americans produce a lot of trash, and they need somewhere to put it.

According to the survey, 84 percent of distributors say their waste receptacle sales have increased or stayed the same compared with five years ago. When asked how waste receptacle sales compare with last year — a peak time of economic growth — 86 percent claimed current sales are the same or better.

“It’s one of those things that people are always going to need,” says Joe Smith, general manager of Building Maintenance Products, New York. “People will always need a place to throw away their garbage.”

Waste receptacle manufacturers have also made improvements in offering specialized receptacles to match various markets.

“Manufacturers are doing a good job of fitting the customers’ needs,” says Jack Bernstein, president of Baltimore Janitorial Supply Co. “A lot of people need receptacles: schools, municipalities, day cares, medical facilities – everyone.”

Bernstein says that he has a partnership with five or six manufacturers that seem to be keyed into trends that affect end users. The survey showed only 16 percent of distributors polled said that they’d like to see an increase in products available.

“We know that with the economy the way it is, capital expenditures are being questioned at all levels,” says Ken Goldberg, vice president of Ex-Cell Metal Products, Franklin Park, Ill. “Because of that, we have to tailor our products to the needs of the customer.”

Goldberg says that providing choices for the end user makes for good business, whether you’re a distributor or a manufacturer.

“Of the new products we’ve developed this year, I’d say about 15 to 20 percent are waste receptacles,” he says. “We know that there’s always the form, fit and the function. All three have to be there.”

Customers buy new waste receptacles for a variety of reasons, and they look for a number of characteristics when purchasing them. Distributors who were surveyed said the No. 1 reason people buy new receptacles is because previous receptacles have worn out and look old. The second reason is simply that more receptacles are required.

More waste receptacles may be needed if an old building is expanding or a new building is being built. The third most popular reason for end users to replace a receptacle is if the old receptacle has actually been abused to the point that it is no longer functional.

With two of the top three reasons relating to the product’s condition over time, it is no wonder distributors say durability is the feature that really sells a receptacle.

“Customers don’t want a cheap product that will need to be replaced,” says Layton Dodson of United Receptacles, Pottsville, Pa. “We’ve had a lot of success with concrete aggregate receptacles because they’ll last forever and stand up to anything.”

Dodson says along with durability, a receptacle has to be aesthetically pleasing.

“It’s like furniture,” he says. “You get tired of looking at the same old thing and eventually you want a change. A waste receptacle says something about the building and is really like a piece of furniture.”

Tim Kounter, sales manager at Cleanway Sanitary Supply, Bakersfield, Calif., says that the way a waste receptacle looks says a lot about a facility’s image.

“Frankly, hotels and motels are quite particular about what kind of receptacle they have,” he says. “They’re going to be there a long time and they have to look good. I know of one hotel that puts an imprint of their logo into the sand on their ash/trash receptacles twice an hour.”

Finding material that is good looking and can stand up to abuse is the key to a good waste receptacle, says Goldberg. “We’ve developed a new receptacle that uses plastic lumber, so it has the look of a beautiful oak, cedar or redwood, but it will last much longer. It doesn’t chip and it covers an inner metal frame that is very durable.”

Besides withstanding wear and tear, a receptacle can prevent bacteria and mold growth. Dodson says that products treated with an antimicrobial agent will last much longer and save a building owner from a lot of extra work. “We use galvanized steel that’s treated with an antimicrobial that will last a lifetime, keeping bacteria from growing,” he says.

Because so many buildings throughout the United States are now strictly non-smoking, there’s a need for durable entrance-way receptacles that take cigarette butts as well. These “ash/trash” receptacles are often one of the most popular selling items for distributors, but currently there is debate surrounding the product’s design and whether it’s a fire hazard.

“Ash/trash receptacles are still very popular, but there has been a great demand for separation of where the cigarette is discarded and the rest of the trash. A lot of regular trash is mostly paper and is combustible,” says Goldberg.

This demand has led some manufacturers to develop a new kind of receptacle with small holes for cigarette butts only, usually in tandem with a regular receptacle so that the refuse is separated.

Bernstein says that the concept of separating cigarettes from paper products makes sense, but that it doesn’t necessarily translate into the customer’s buying decisions. “I think it’s a great idea,” he says, “but I haven’t sold many of the new kind.”

Distributors can find out if a receptacle is listed with Underwriters Laboratories (UL) and approved as being fireproof. Knowing that it has been passed the test gives the customer peace of mind.

Every facility must evaluate what kind of waste receptacle is best, whether it is an ash/trash receptacle or not. And distributors can help their customers reach the right decision by educating them about the products.

“It’s great when distributors are cognizant of what the customer’s needs are,” says Dodson. “Ask the customer what he’s doing about litter control and find out which option is best.”