Waste Management UK Market Intelligence

*This report was last updated in Q4 2018. Please click on request customization if you are looking for an updated version of this report

Report Coverage

  • Cost Structure for Waste Disposal Services: UK
  • Service Engagement with Waste Management Suppliers
  • Best Practices in Contract Management: Contract Bidding
  • Cost Negotiation Areas
  • Supplier Evaluation Matrix

Table of contents

  1. Market Overview
  1. Market Synopsis
  2. Market Drivers and Constaints
  3. Insourcing a Trend or Myth?
  4. In-house Services is Preferred: Reasons
  5. Supply Market Preferences
  6. Brexit: Impact on Waste Management Procurement
  7. Best Practices
  1. Engagement Models
  2. Price Models
  3. Cost Drivers for Waste Management Services
  4. Cost Structure and Price Benchmarking
  5. Contract Management: Key SLAs and KPIs
  6. Contract Negotiation Levers
  7. Case Study
  8. Best-in-class Public Sector Waste Management Service
  9. Costs, Steps and Risks for Bringing this Service Back In-house: Three Rivers District Council
  10. Supplier Intelligence
  1. Best-fit Supplier Analysis
  2. Top Suppliers
  3. Porter’s Five Forces Analysis
  4. Supplier Assessment
  5. Supplier Contact Details

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Regional Market Report on Waste Management

  • The waste management market that includes the processes, such as collection, treatment, recycling and disposal, had a market value of £31.6 billion in 2017
  • The amount of waste collected is over 165.1 million tonnes every year, only in England. The industry employs over 140,000 people
  • By 2020, it is estimated that the UK will spend almost £5.4 billion in treating waste for re-use and safe disposal


Industry Trends

  • The industry is moving from linear to circular business model
  • It includes repairing and refurbishing products or things to re-use. Reprocessing waste into new products
  • Conversion of non-recyclable waste into fuel for production of energy
  • Zero-waste to landfill
  • Gasification and pyrolysis are the two increasingly used and easier methods of waste re-use

Market Drivers and Constraints


  • Strict regulations have been one of the major influencing factors
  • Innovations in recycling techniques
  • Need for an alternate source of energy
  • Diminishing landfills
  • Economic conditions
  • Sustainability


  • Adaptability toward the various methods of waste management
  • Time delay between waste management law enforcement and execution
  • People's knowledge about the benefits of effective waste management

Current Market Trends

The market trends in waste collection and disposal services in terms of in-house vs. out-sourcing models, is about 50 percent in-house and 50 percent out-sourced. The trend in 2018 is towards in-sourcing even higher than 2017. Also there is forecast for increase in tender costs.

In-source Model

  • Councils will have better control in meeting public sector requirements
  • Reduced overhead costs and other cost factors
  • Both public sector and private sector strengths can be used
  • However, councils have to bear all the risks by themselves. Risks such as changes in recycling rates, changes in regulations, cape cost etc.,
  • Service bundling of household waste with street cleansing and waste collection might be challenging due to staffing and recycling rates issues

Out source Model

  • Councils can share the risk involved in handling waste during the period of contract
  • Cape cost can be borne by the supplier
  • Despite recycling rate fluctuations, an agreed margin to the supplier, prevents loss and discrepancies
  • But, councils will have reduced control in the service
  • Service bundling of household waste with street cleansing and commercial waste collection reduces administrative overheads when out-sourced, but increases costs

The major reasons for increase in Tender costs are:

  •  The cost of  waste bin lifts and landfill taxes increased 2.4 percent and 3 percent respectively in 2018 along with regular demand for waste management and recycling wages rose 3 percent as a after affect in China Waste Ban in 2018
  • Also as an effect of Brexit, skilled labor shortage and increase in labor wages by 2.3 percent. Firms will not be able to absorb costs for so long and will have no choice but to increase tender prices

In-house Service is Preferred: Reasons

Drive for quality and value for money:

  • Services have been insourced as a part of local authority drive for quality service provision and value for money. Service reviews, performance indicators and benchmarking have enabled local authorities to prove that an in-house team can provide better value for money in service delivery than an outsourced contract
  • There was a degree of inflexibility on the part of private sector contractors to deliver new, added value and quality improvements to service delivery

The workforce:

  • Services have been insourced as a result of unmotivated workforce, contributing to poor performance. Poor terms and conditions and poor career development opportunities would appear to impact the quality of service delivered

Strategic governance and local policy drive:

  • Services have also been insourced as a result of factors, such as local political support and the need for a more strategic, holistic approach to public service provision as a part of an integrated service delivery model
  • Local authorities have also brought services back in-house as a result of changing national and local policy agendas and a belief that in-house delivery would enable greater flexibility to respond to emerging policies

Poor performance:

  • A primary reason for insourcing services appears to be related to poor performance of the service area against key local and national targets and low levels of service user satisfaction
  • In some cases, contractors had to reduce the number of activities being delivered as a part of the service, as a result of rising costs, and that the assets being used to deliver the outsourced service, such as refuse collection vehicles were poor

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