Unlocking Profit Potential in Waste Recycling: A Guide to Building a Sustainable Business

Turning waste into profit is challenging but achievable with the right approach.

Which Types of Waste Offer Revenue Opportunities?

Not all waste materials are equally lucrative for entrepreneurs, especially considering recent regulatory changes.

In many regions, only authorized regional operators hold the rights to collect, transport, and process municipal solid waste. According to Pavel Kokorev, a leading legal expert at the European Legal Service, only select cities like Moscow, Saint Petersburg, and Sevastopol had an extension until 2022. Municipal solid waste includes household trash such as food scraps and spoiled items generated from daily personal and domestic activities. Waste from companies or individual entrepreneurs' offices also falls under this category if disposed of similarly.

Regional operators are selected through competitive tenders for terms up to 10 years by local authorities.

While it's theoretically possible to establish your own company, win a tender, and secure waste management contracts, newcomers without strong connections may face significant challenges. However, ambitious entrepreneurs can still consider this path.

For those seeking lower entry barriers, focusing on recycling industrial and consumer waste containing valuable components is advisable. Such waste is generated by both households and businesses and includes items like:

• Metal scrap, including beverage cans;
• LED lamps;
• Mercury-containing lamps, thermometers, and similar products;
• Waste paper;
• Tires;
• Polyethylene plastics;
• Glass containers;
• Batteries and accumulators;
• Electrical appliances.

Overall, there are around 182 types of recyclable materials.

Steps to Start Earning from Waste Recycling

Carefully Plan Your Venture

Before diving in, take time to analyze critical aspects beyond the usual business considerations.

1. Source Your Raw Materials

Your sourcing strategy depends on the waste types you choose to recycle. For instance, many businesses generate by-products that can serve as raw materials. You might even receive payment from companies for accepting certain waste, such as mercury-containing lamps, which they are legally obliged to dispose of properly.

Engaging the community’s environmental awareness by installing collection bins (with local authority approval) for plastics, glass, and other recyclables or organizing separate waste collection drives can be effective. Offering incentives for waste drop-offs is another option.

Landfills remain a source, though regional operators are responsible for municipal solid waste disposal. However, sorting and recycling facilities are not yet widespread in every area.

2. Identify Markets for Processed Materials

For example, if you collect batteries and extract metals like iron, manganese, zinc, potassium, and nickel, you need to know who will purchase these materials and at what price.

Approximate prices per ton of processed and compressed recycled materials are: plastic – up to $200, aluminum cans – up to $670, rubber crumb – up to $215, and compressed cardboard – up to $160. A small enterprise can process up to 10 tons of recycled materials per shift.

Denis Sitrakov
Head of Grinding and Recycling at Molom Company

Set Up Your Processing Facility

Equipment manufacturers offer turnkey recycling lines, or you can select individual components. Understanding the technology beforehand helps optimize costs and ensures you acquire necessary machinery.

For example, a basic plastic recycling setup costs around $90,000 and includes a shredder with a capacity of up to 6 tons per hour, two conveyors, and a control panel.

Denis Sitrakov

Consider staffing needs during this phase.

Register Your Business and Obtain Licenses

Simply registering your company is insufficient. Waste collection and recycling are licensed activities requiring approval from environmental authorities. You must submit:

• An application;
• Documents proving possession of premises, equipment, and vehicles for waste handling;
• Proof of qualified personnel responsible for waste operations.

Additional permits from health, fire safety agencies, and a waste management passport are necessary.

The waste management passport details disposal methods, hazard classifications, and waste origins, prepared according to standards. Steps include:

• Gathering documentation on waste hazard class, chemical properties, and processing methods, then submitting to environmental authorities for verification. Chemical analyses must be conducted in accredited labs.
• Preparing the passport document.
• Obtaining approval from technical supervision agencies.

Organize Raw Material Collection

Having planned sourcing, now implement logistics. For example, if collecting waste paper, arrange container placement, schedule pickups, hire transport, and coordinate collection teams.

Key Takeaways

• Launching a recycling business requires patience; licensing and paperwork typically take 3–4 months.
• Initial investments can reach several million dollars depending on the waste type.
• Waste recycling is a forward-looking industry with growing global demand, offering excellent long-term business prospects.

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