Veolia manages price revisions through a transparent and formulated rate review mechanism.
What is a rate review?
Veolia is subject to adjust rates and prices on the 1st of July every year due to changing levies, subcontractor prices, fuel costs and more.
Is there a set price change every year?
This is highly dependent on the size of your business, your waste streams, your geo-location, government policies and more.
When rate reviews occur, Veolia will always substantiate and provide evidence to all of our clients.
Why does Veolia have to change rates?
To remain in operations, Veolia may be subject to alter our rates, as they directly relate to landfill levies and/or the cost of waste disposal and treatment.
We can confirm the percentage difference will always be:
- an amount equal to any increases in landfill levy incurred, as evidenced by a letter from the relevant landfill operator; or
- an amount equal to any increase in the cost of waste disposal and treatment, as evidenced by a letter from the relevant disposal facility owner or operator.
Veolia may also pass on any cost that relate to the introduction of a carbon tax or carbon emission scheme by the government, as they occur.
How do you price in ad hoc and/or urgent requests?
Generally, most of our trucks operate outside business hours, as part of their routine schedules.
For an additional service, we normally try to fit the collection into another scheduled run, and there will be no extra charge. However, if we need to send a truck out specifically for the collection, there will be an hourly charge, depending on the services required.
For hazardous materials, there are many variables such as the material, service required, quantities, day and time; these will be priced on application.
Veolia has reconfigured its waste management service agreements that underpin our SME customer relationships. The core changes aim to deliver improved transparency, security and predictability.
For general waste and cardboard on front lift services for larger clients, Veolia’s Paperless Truck System (PTS) allows us to weigh each bin during collection, so that our clients only need to pay for the waste they are moving.
What’s the difference between traditional pricing and weight-based pricing?
Rather than the traditional method of charging a cubic metre rate or flat fee per bin emptied, Veolia is able to charge clients a rate per kilogram, plus a transport cost. We are able to implement this weight based pricing model on all front lift services in all areas where Veolia operates.
When collecting cardboard under the weight based pricing model, clients would be charged a transport cost for Veolia to arrive at the site and a rebate would then be provided to the client based on the contents of the bin. For example, the more cardboard per collection, the greater the rebate for the client. This measure could result in the client being able to turn a waste stream into a cost neutral item, or even a revenue stream.
Why adopt this weight-based pricing model?
Advantages of weight-based pricing include:
- Fair cost structure
- Rebates on cardboard services
- Reduced spend on general waste and potential increased revenue through rebates
- Reduced frequencies and greater bin sizes deliver instant cost savings
- Financial accountability retained by the user/individual site, including financial and recycling performance/impact
- Stores or sites can be measured and compared
- Transparency across all costs associated with our service
- Alleviating fixed rates will promote sites to 'do the right thing' and take all recyclables out of general waste
- Visibility of actual weights results in accurate waste data reporting.
This pricing model has a real impact on the bottom line and provides an incentive for ongoing improvement initiatives.
The commodity market in Australia and New Zealand is highly dependent on a range of conditions such as distance from end-market e.g. Box Manufacturing Mill (cardboard & paper), consolidation points for export, as well as supply and demand.
Veolia traditionally works on an open-book process that reflects the total rebate paid for product less a handling fee both as a percentage rate. In this case, Veolia would propose a 75% split to the client and a 25% split retained by Veolia.
The open-book percentage split ensures that Veolia has strong motivation to achieve the highest possible rebate.
In terms of how those rebate rates would be determined and the frequency and method in which we would deliver, it would be highly dependent on the material as well as current market rates. The documentation to be provided will depend on each situation, and we will assess on a case-by-case basis.