Tauranga’s Kleana Bins is facing an annual turnover loss of between 70 and 80 per cent, thanks to Tauranga City Council’s decision to charge residents a targeted rate for kerbside waste collections next year.
Managing director and general manager John Cruickshank says the decision has been catastrophic.
“There’s a number of other ways they could have structured the whole process that would have left some of the market open to local businesses and probably caused a lot less disruption overall without making very much difference to the final cost of the service.”
John has about 20 staff, with 11 or 12 trucks on the road every day, operating only in the Western Bay of Plenty and Tauranga council districts.
“When I bought the business in 2000, there was me and two drivers and one part time girl in the office and we've grown it from that to 20 odd people now.”
He says the council decision has been brewing for about five years.
“There’s people on the council staff who've been pushing it very hard for all of that time. They took the final vote on the scheme on August 25 but they didn't bother telling anybody what the outcome was until well through September. So that was pretty disappointing.”
The impact on his business will be significant.
“I think we will keep about 50 per cent of our Western Bay market. We’re not sure at this stage, as we may still have a few people in Tauranga that will keep using us regardless of the council service, but on the face of it, we’re unlikely to keep very much in Tauranga at all.
“We are hopeful we can establish the business elsewhere using some of the trucks and perfectly good wheelie bins that are no longer useful here, but that’s not certain. The alternative is to downsize the business to perhaps a quarter of what it is, which is not easy to do and there’s no certainty that the business will survive.”
It means reducing staff from 22 to five. John says his staff have been apprehensive about this for a long time.
"Nobody’s very happy but we all have to live with this - all I can do is try to keep as many jobs open as I can."
Kleana Bins have been involved with many community initiatives, supplying wheelie bins to the Multicultural Festival and emptying bins at the Te Puke High School sports field free of charge, and supplying bins to some rural schools at below cost. The company is well-known across the Tauranga and Western Bay communities for their support of the ‘It’s Not Ok’ family violence campaign.
“Under the present set up there are five companies in Tauranga that collect rubbish. Two of us, Bin Boys and Kleana Bin are locally owned, two are Chinese-owned and the other one is Australian-owned.
“We think most of our Western Bay full-service customers will stay with us because there's no reason not to, as Western Bay are not putting the cost of your rubbish collection on the rates. They're giving you a rubbish bin and you buy a tag from the supermarket to get it emptied. If you don't want to use it, you don't have to pay for it.
“I think some of the Tauranga councillors wanted to do a similar system for Tauranga but the majority voted against it.”