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Waste Not, Want Not

Published in the September 2009 of American Executive magazine

Waste collection may not be the most glamorous industry, but it is one of the most important. With waste generation having tripled in the last half-century, companies like Waste Pro USA have a seemingly unlimited potential for growth— if they can keep up with the competition. So far, Waste Pro has been up to that challenge and then some.

“In order to compete against national companies, we have to take advantage of technology and exceed our customers’ expectations when it comes to service,” said John Jennings, founder, president, and CEO. “So far, we’ve been able to do just that.”

When we first spoke to Jennings back in January 2008, we learned of his more than 30 years in the business; the sale of his Florida-based Jennings Environmental Services to what would become known as Waste Management; and his retirement and subsequent return to the waste collection industry with the founding of Waste Pro in 2001.

Waste Pro’s excellent reputation in the Southeast is due to its ability to exceed the service expectations of its customers. The company is regarded as reliable and employs local customer support representatives instead of farming out customer service to a large, centralized call center. Its business development team customizes each proposal to every municipality it meets with, taking into account the needs of each community.

Today, the company has operations in Florida, Georgia, South Carolina, and Alabama. Waste Pro operates out of 35 facilities—25 hauling stations, five material recovery facilities, three construction and demolition landfills, and two waste transfer stations. It is the fastest growing waste services company in the US and the leading provider in the Southeast. Focused on residential and commercial municipal solid waste collection, Waste Pro serves more than 825,000 homes and has more than 32,000 commercial and federal customers.

The Waste Pro story begins with a leadership team with approximately 130 combined years of experience in the industry. Since founding the company with the acquisition of three small waste service companies in Georgia, Florida, and South Carolina, the firm has done nothing but grow. In 2002 and 2003, the company acquired assets from eight companies and won sought-after federal contracts with Kennedy Space Center and two Air Force bases.

Since that time, Waste Pro earned more than 250 exclusive municipal contracts in its service territory and now has 117 municipalities under contract. It completed 15 more acquisitions, including the acquisition of American Recycling Group, last year.

“We believe in acquiring the best equipment in the market and recruiting the best people,” said Jennings. “With American Recycling, we are fortunate to be able to  add great talent to our team. This addition allows us to remain at the forefront of the green movement.”

There are many factors that differentiate the comany from its competitors. It has nearly 700 collection vehicles that have an average age of less than three years, whereas the rest of the industry averages close to eight years old. Its trucks have unique synthetic liners around their hydraulic systems to eliminate leaks, emission controls recapture and reburn released emissions, and pre- and post-trip inspections keep the trucks up to speed.

Seeking opportunity

Having grown from zero revenue at the time of its inception in 2001 to more than $200 million in revenue today, an even more successful future for Waste Pro is right in the company’s hands. In the last few years, it has secured access to capital. Ares Management invested $40 million in the company in 2006, and the last few years have seen Waste Pro finalize a $200 million senior credit facility with Comerica Bank.

Beyond that, all the market indicators point to continued opportunity. A rising population means more generation of waste, and the Southeast is one of the fastest growing regions in the country. Florida’s population is expected to be double what it was in 2000 by 2030. Georgia is the ninth-most populous state in the union, and more than half of those people live in the Atlanta metro region, where most of Waste Pro’s Georgia operations are centered. South Carolina and Alabama represent the smallest parts of the company’s business, but both states are growing, which is good news for Waste Pro.

More than that, waste collection is practically a recessionproof industry. Waste generation continues to increase, and industry consolidation is removing many players from the field. More and more municipalities are looking to private entities for waste collection because of the cost savings as well. Waste Pro is also in tune with the environmental concerns that are driving the industry’s evolution. It owns just three landfills, which means it experiences less difficulty dealing with government regulations than some of its competitors. More waste is being sent to material recovery facilities, of which Waste Pro has five, because of heightened environmental awareness and a desire to keep waste out of landfills and incinerators. And some acquisitions are tailored toward environmental concerns, such as this year’s acquisition of St. Pete Recycling Solutions in St. Petersburg, Fla.

For Waste Pro to continue winning and retaining customers, it will stick to a plan that has worked so far. Its executives and sales managers strive to have an active presence within its communities and establish relationships with county officials and industry consultants, approaching each market according to the demands on the ground instead of a centralized, onesize-fits-all approach.

The company focuses on developing long-term municipal contracts and only deploys capital expenditures when contracts are won. Its diversified customer base consists of exclusive and non-exclusive municipal contracts in addition to its commercial and federal contracts. This diversified approach means the company isn’t dependent on a single customer or region.

Waste Pro is well positioned because of a strong foundation and opportunities in existing markets as well as its active pursuit of expansion into new markets. It has identified more than $800 million in municipal contract opportunities and has identified roughly $60 million in revenue from potential acquisitions. The company’s ability to impress is clearly evident as it continues to win the majority of its contract opportunities. In the last few years, Waste Pro has reached agreements with many municipalities, including Florida’s Palm Beach County; Beaufort, South Carolina; and Loganville, Georgia. But the best evidence of Waste Pro’s success can be seen in the fact that it has won all of its 21 recompeted contracts. That is the utmost sign of the company’s commitment to developing and maintaining strong relationships with customers.

“We are focused on continuously improving internally and in terms of the service we provide,” Jennings said. “This not
only benefits us but helps us better serve our customers.”

–Eric Slack