Save Your Waste Hauling Business $200K This Year: Think in Minute Value


Save Your Waste Hauling Business $200K This Year: Think in Minute Value

It's Easy to Save Your Waste Hauling Business $200K This Year - Think in Minute Value stopwatch on $100 dollar bill Routeware
by Sloan Morris, Vice President

So…what’s the value of a minute?

To be more specific, we are asking: What is the economic value of one minute of time for waste collection fleets? And why should you care?

Paying more attention to the operation minutes for your waste collection fleet – and looking at these minutes with a fresh perspective – can uncover surprising areas for savings optimization.

Take care of the pennies and the dollars will take care of themselves.

-American saying

Taking a fresh look at the minute-by-minute performance of your fleets can identify on-the-clock hours that can be better allocated, and pennies (and dollars!) that can be better saved.

What is the dollar value of one minute operating a waste hauling fleet?

Here at Routeware we talk with professionals in the waste industry every single day. They consistently tell us that it costs on average $100 per hour to operate a waste collection vehicle. In particularly expensive areas, such as New York and San Francisco, the average cost is around $150 per hour (or more). This includes the cost of the vehicle, maintenance, repairs, insurance, permits, fuel, driver wages, driver benefits, tolls, and tires.

Operational Costs of Trucking pie chart by American Trucking Research Institute Routeware

So simple math tells us that if 1 truck operating hour costs a business $100 on the low end, then…

The value of 1 minute to a waste hauling business equals

$100 ÷ 60 minutes = $1.67

$1.67, the Value of a Minute to a waste hauling business in trucking operations costs Routeware

There’s not much you can buy with that amount. It won’t change your life or your business, right?

Unless you start collecting a minute here and a minute there. The thing about minutes is they add up fast…amazingly fast.

Why should you care about the value of a minute?

Because in waste hauling, minutes add up faster and with more impact than you would expect due to the size, scale, and repetitive nature of the business.

Here’s an example:

How much would it be worth to your fleet over the course of a year if every day, each route saved one tiny minute?

First answer using your gut sense. Given the size of your business, what do you think that would add up to over a year’s time?

Next let’s figure out how much it actually impacts your bottom line.

How to calculate the yearly dollar savings to your waste management business if you just saved 1 minute per truck per day

Start with:

  • The number of trucks you run each day, on average
  • The number of days per week you run routes
  • Cost per hour to operate a truck (Most folks use $100 per hour unless in a more expensive area of the country)

Calculate the value of saving 1 minute per route per day in your fleet operating costs using this formula:

# trucks × # days per week × 52 weeks per year × $ per hour  ÷  60 minutes  =  savings realized for 1 minute per route per day

Here’s an example: Let’s say you have a fleet with 25 trucks that runs 6 days per week.  The calculation for this fleet is:
25 trucks × 6 days per week × 52 weeks per year × $100 per hour  ÷  60 minutes  =  $13,000 in savings

Just saving one minute on each truck’s route, each day will realize a total of $13,000 in trucking operational costs for a waste management business over the course of a year.

1 minute/truck/day is a conservative estimate. If you are on the hunt for minute savings across your fleet, you will likely find many minutes that can be put to better use.  In the above example, if the same 25-truck fleet:

  • Saves 5 minutes per route per day, that would be an annual savings of $65,000
  • Saves 15 minutes per route per day, that would be an annual savings of $195,000

So if you are able to identify even just 15 minutes per route per day that could be eliminated, consolidated, or optimized – that is close to $200,000 per year that you can save your waste hauling business.

Routeware customers report, on avergage saving 30 – 60 minutes per route per day!  (Not to mention additional revenue from more logged extras and other benefits.)

At Routeware, not only do we make it easier to automate your fleet and provide tools to help your drivers, dispatchers, customer service reps, managers, and executives, we are also experts at helping our customers identify and reallocate the valuable minutes that could be better spent each day. Once you see the minutes and do the math, one minute will take on a whole new meaning to you. Contact us to learn more.