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SOURCE: IBISWorld 3
A stronger economy will further boost business, industrial and construction activity over the next five years, which will lead to more waste and, therefore, greater need for disposal and recycling services. For this reason, industry research firm IBISWorld has updated its report on the Waste Collection Services industry.
Los Angeles, CA (PRWEB) January 17, 2013
The Waste Collection Services industry is sensitive to many facets of the economy, ranging from changes in population, technology, commodity prices and consumer behavior to industrial, business and construction activity. Over the past decade, the waste pile in the United States has grown; the Environmental Protection Agency (EPA) estimates that municipal solid waste (MSW) stands at about 258.2 million tons in 2012, up from 235.5 million tons in 2002. The industry also collects industrial, construction and demolition waste, which builds from industrial and construction activity. Because activity in these two sectors tumbled in 2008 and 2009, industry revenue also dipped during these years. Over the five years to 2012, revenue has increased at a stunted average annual rate of 1.1%. In 2012, revenue is expected to climb 6.2% to $46.3 billion, driven by returning demand from commercial industries. The industry collects most of the country's waste, while local municipalities, which are not included in this industry, provide services to about a quarter of the municipal solid waste (MSW) market. According to IBISWorld industry analyst Deonta Smith, the amount of waste collected directly by these municipalities is declining; these services are increasingly being outsourced to private operators. In 2012, the largest private operator is expected to collect about 66.0 million tons of residential, commercial and industrial waste.
The industry is composed of 7,010 enterprises and 181,837 employees, representing a vast network of trucks, drivers and bins that reach more than half of the population. The major national and regional operators in the industry have been vertically integrating over the past five years, operating along the complete waste chain of collection, transfer, disposal and recycling. Waste collection generates nearly three times the revenue generated by waste disposal and more than 10 times that generated from the sale of recyclable material and energy produced from waste. The top operators in the Waste Collection Services industry are Waste Management Inc. and Republic Services Inc. Larger operators acquiring smaller competitors has driven consolidation over the past five years, but this trend has begun to change because larger operators have increasingly merged with their larger counterparts. For instance, in 2008, Allied Waste merged with Republic Services, bringing together the second- and third-largest industry operators. In response to increasing regulations and costs, larger operators are vertically integrating their waste management services, says Smith. The ability to offer the full range of services in collection, recycling, transfer and disposal gives companies an advantage when tendering for collection contracts. Heightened environmental awareness by many communities and municipalities is expanding the range of collection, recycling and disposal services demanded. Vertical integration also allows collection companies to internalize the payment of tipping fees to landfill facilities, if the waste is deposited at their own site. Many larger operators are currently disposing of businesses that have lower margins and are purchasing businesses that will give them advantages in efficiencies and economies of scale, resulting in increased concentration.
Despite mergers and acquisitions, concentration is anticipated to diminish over the five years to 2017. As major downstream markets grow, demand for collection services will increase and, with it, new operators are expected to enter the industry to meet collection needs. In addition, increased demand for recycling services will result in a greater number of companies specializing in collecting and sorting recyclable material. A stronger economy will further boost consumer spending as well as business, industrial and construction activity over the next five years. These conditions will lead to more waste and, therefore, greater need for disposal and recycling services. Over the five years to 2017, revenue is projected to grow. For more information, visit IBISWorld’s Waste Collection Services in the US industry report page.
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IBISWorld industry Report Key Topics
Industry operators collect hazardous and nonhazardous waste and recyclable materials. Nonhazardous waste includes municipal solid waste (household waste) and industrial and commercial waste. The industry includes transfer stations, where waste is transferred from local vehicles to long-distance vehicles for transport to disposal facilities. This industry does not account for government-provided services of a similar nature.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.
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