Analysis of Top Waste Management Companies in the U.S

In the United States, waste management companies are judged and ranked based upon their revenue, income, employees, and overall environmental records. The top four waste management companies include Waste Management Inc., Republic Services, Inc., Covanta Energy Corporation, and Casella Waste Systems. These five companies offer their services all across the United States consistently drawing resources and experience in order to efficiently serve millions upon millions of residential, industrial, municipal, and commercial customers.

Waste Management Inc. has been a leading contributor of environmental services to the United States since the 1890’s. Back then they charged $1.25 per wagon in Chicago, Illinois. They forcefully acquired many other smaller garbage disposal services up until 1971 when Waste Management, Inc. went public with $82 million in total revenue (2008, Corporate). The company has since growth at a remarkable pace and has implemented new technologies, safety standards, and safety practices. By 2003, Waste Management, Inc. produced over $1 billion in free cash and began to return their profits to their shareholders. Currently, Waste Management, Inc. includes over 354 collection operations, 341 stations, 277 disposal sites, 16 waste-to-energy plants, 108 landfill projects, and 6 power plant productions (2008, Waste).

I foresee many strengths for Waste Management, Inc. as well as weaknesses. The strengths include increasing revenue, ever growing operation systems for production, strong marketing schemes, and increasing environmental projects. Waste Management, Inc’s profits have growth steadily in the stock market, even through the tough economic times we are currently seeing (2008, Waste). Their operation systems are continuing to grow and expand throughout the United States, from their 1200 sites, they are said to continually expand over the next ten years and possibly longer, pending the economic stance at that time. They use aggressive marketing techniques with slogans such as, “What business do we have saying we help the environment? That is our business.” Waste Management, Inc. is also included in a Walt Disney World attraction called “Innovations.” They currently have 16 plants that generate 650 megawatts of electricity, which is enough to replace more than 6 million barrels of oil and power 600,000 homes per year. They have doubled these plants since 2005 and plan on increasing their facilities in the next five to ten years (2008, Corporate).

Waste Management, Inc.’s weaknesses include the depressed economic market, falling but still high diesel fuel prices, and their strong, less-expensive competition. The market affects every company to an extent, but with waste management, it is a little more resistant to the recession (2008, Corporate). People are getting rid of less and less wasteful materials, which will lessen their production. The diesel fuel prices are finally falling, but are still expensive and can run a company which relies on driving into the ground. Their competition is up and coming and tends to run slightly cheaper than their prices and can hurt if they give them too much leeway (2008, Waste).

Waste Management, Inc, in my opinion, has the opportunity to take advantage of the economic recession, competition’s inexperience in the market, marketing slogans, and their ever-expanding environmental plants. The recession brings with it hard times, but through those hard times can bring great options for cash flow stability and rising stock prices (2008, Corporate). The competition may offer cheap prices but lack overall experience in the field, especially with the recession. Their slogans are very catchy and have proven effective in the past and if they continue the same typical marketing schemes may be able to bring in more business. Waste Management, Inc. has many environmental plants and plans on increasing these plants in order to create more environmental success as well as revenue (2008, Waste).

The threats that I can see include cheap competition, inability to predict plant expansion, and negativity from the media. Their competition seems to be positive and negative, but if it is not neutralized by lowering their own prices, it may steal away some important business. Being in unpredictable times, it is very difficult to guess what is to come in the near future when it comes to their new business of waste-to-energy plants. The media seems to speak negatively about Waste Management, Inc. due to the excessive use of diesel fuel. It may be key to find a different way of transporting their waste they pickup or increase capability of trucks to decrease fuel usage (2008, Corporate).

Republic Services, Inc. was once the third top waste management company. After the purchase of their larger competitor, Allied Waste Industries for $6.1 billion in June 23, 2008, Republic Services, Inc. became the second largest waste management company in the United States (2007, 12/31). They currently own 427 collection companies in 40 states and operate 255 transfer stations, 219 landfills, and 86 recycling facilities (2008, Republic).
The strengths of Republic Services, Inc. append their equity, liquidity, and financial strength. Their equity increased over the past ten years, raising them to the third top waste management company in the United States, and doubled since the purchasing of Allied Waste Industries (2008, Republic). Liquidity also increased and seems to stay the same with the waste management industry as resistant to the recession as it is, as well as the acquisition of their competitors. Finances don’t seem to be too much of a problem with over 900 waste facilities currently operating and their plans to expand both old and new customer facilities (2007, 12/31).

Weaknesses in Republic Services, Inc. can be distinguished as their over extending their resources with the new possessions, including both facilities and employees, and possible future financial problems. They can end up losing money and employees by actually creating competition for themselves. They spent a large sum of money on purchasing Allied Waste Industries and that $6.1 billion dollars can be lost if either company’s business does not increase as planned (2008, Republic).

The are quite a few opportunities Republic Services, Inc. including their newly acquired facilities, expansion with both old and new plants, and increasing employment numbers. Upon purchasing Allied Waste Industries, they gained many new facilities and employees. This can help them expand national as well as increase their overall revenue. Their expansions are to begin shortly, in 2009, and will include both ex-Allied Waste Industries facilities and previous facilities. Employment numbers have been increasing since the early 2000’s and jumped even more after the merge of Allied Waste Industries into Republic Services, Inc. (2007, 12/31).

Republic Services, Inc.’s threats can be seen by over expanding their previous and newly acquired facilities and losing revenue if the Allied Waste Industries’ facilities business falls behind or simply does not increase. If they expand too much, Republic Services, Inc. can lose money by expanding without increasing their prices or lessening employee’s prices. This can lead to plant closings and job losses instead of an increase. They spent $6.1 billion to acquire Allied Waste Industries’ facilities and customers, but if their business does not increase, that money will end up going to waste and the company as a whole will fall behind in their revenue (2007, 12/31).

Covanta Energy Corporation began its business in 1939 as a company called Ogden Projects. In 1952, they extended their company by purchasing W.A. Case and Son Manufacturing Company then again in 1955 by obtaining Luria Brothers. Since that acquisition, Ogden Projects has gained small waste management companies, allowing them to increase their business in the United States (2008, Covanta). After losing money in 2001, Ogden Projects changed it’s name to Covanta Energy Corporation. However, in 2002, Covanta Energy Corporation filed for chapter 11 bankruptcy, and bought out by Danielson Holding Corporation two years later, leaving the name as Covanta Energy Corporation. They own over 30 energy-from-waste facilities which can turn 16 million tons of waste to over 8 million megawatts of renewable energy (2008, 06/25).

Strengths of Covanta Energy Solution include it’s diversity as well as their strong, recession-resistant organization. Covanta extends its services from water-related management to modern waste management, even to new, experiment-type system approaches. This allows the company to gain more customers in a bigger market. The way the organization was built, Covanta is able to withstand the economy problems seen today and allow them to extend their services just as well as if the economy was booming (2008, Covanta).

Covanta’s weaknesses lie in their upper business management as well as their constant reorganization. The management seems to lack an understanding in their competition and how to manage their employees effectively (2008, Covanta). This faulty area can cause the company to lose business and even lose employees. From this, comes a constant urge to reorganize their management system and the time spent training new management and employees wastes finances and time to capitalize on their competition (2008, 06/25).

Covanta’s opportunities include a large market, new, experimental systems just introduced in the United Sates, and just as large investment possibilities. The market has increased for Covanta since 1983 and allowed them to expand their facilities to accommodate more business. The experimental systems have increased in popularity due to the demand for “green” business and permitted Covanta to attempt new ways to change waste into energy. The investment opportunities would come with the expansions and new experimental systems, and offer Covanta to make more revenue (2008, 06/25).

The threats of Covanta Energy Solution can be seen as limited finances after the bankruptcy and loss of funds with those experimental systems(2008, 06/25). Since they only own 30 facilities in the United States, Covanta does not have as much financial backing as the other top companies, and therefore needs to conserve their profits and spend it wisely. The experimental systems can lose money if many attempts fail and are unsuccessful in making any form of profit (2008, Covanta).

Casella Waste Systems was formed in 1978 by the Casella brothers, John and Douglas. Casella began as a solid waste company which grew to offer collection, transfer, disposal, and recycling services (2008, 11/3). The brothers started with a single truck and had the ability to meet and change expectations from residences and grew to a top American waste management company. The company covers 34 states and currently operates 13 landfill sites, 38 solid collection businesses, 32 waste transfer stations, and 38 recycling facilities (2008, Casella).

The strengths of Casella seem to be the ability to draw extensive resources during any time or situation needed, skill accessible, and expertise in the field. The resources are brought all throughout the country and from many diverse associates and can be accessed at any time, for any reason. The skill and expertise available to Casella is due to their extensive employment research and the professional need, with high pay rates available for experienced employees (2008, 11/3).

The weaknesses in Casella Waste Systems can include construction of new facilities and extending current ones as well as the overage of their operational costs. Casella does not extend their facilities often and therefore do not have many connections or even much experience in additions to their current situation. The operational costs are not extremely out of the ordinary, but if changes are not made to keep costs at a minimum, Casella may end up losing money in light of this (2008, 11/3).

Casella has shown great opportunities in the form of recession resistance, financial stability, and strong landfill and transfer operations. Much like many of the waste management companies today, Casella is recession resistant mainly due to the need for a waste management, no matter what the economy looks like (2008, 11/3). Their financial situation is very strong due to the downturn in the economy and their ability to not over extend themselves and stick with the most prominent areas in the United States; the northeast residential, commercial, and municipal customers. Their landfill and transfer operations continue to perform well, no matter what point the economy is at, and allows Casella to remain at a stable rate of efficiency (2008, Casella).

The threats to Casella Waste Systems can be seen to include negative media attention and lack of industry diversity. Casella continually gets a bad wrap for having a negative affect on public health. These rumors stemmed from reports that their facilities set too close to residential areas and caused public health problems. The media got hold of this and had a field day; even though the rumors were false, the media continually tries to make a story of Casella. The lack of industrial diversity can hurt Casella in the long run, if they cannot change their direction that is. The company does not have enough expansion options with their straight, narrow business path. Casella will eventually have to extend their business plan to include more paths they can follow (2008, Casella).

All of these top United States waste management companies have many similarities in both positives and negatives. It seems as though they all lack some sort of financial backing and all are very strong when it comes to resisting recession problems. The waste management industry just seems to grow larger and larger, and with new “go green” attitudes, the energy transferring business will be in large demand, and for some of these companies, it will only raise their necessity to the economy and society (2008, Republic).

Works Cited

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(2008, 11/3). Casella Waste Systems, Inc. Retrieved December 9, 2008, from Casella Waste
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(2008). Covanta Energy Corporation. Retrieved December 9, 2008, from BNet Web site:
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(2008, 06/25). Covanta Energy Corporation. Retrieved December 9, 2008, from Covanta Energy
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