Plastic recycling business is an investment option many people will never think about.
When we talk about waste recycling business, the obvious thing that comes to the average mind is the embarrassing thought of walking from one dump site to the other looking for plastic bottles.
And yes, the plastic recycling business involves walking from one dump site to another searching and picking plastic bottles.
It is anything but embarrassing. However, that doesn’t mean that as a ‘recycler’, you’ll need to do the picking yourself.
Recycling of plastic and any waste involves three stages: collection, sorting, and processing. Each stage provides a unique business opportunity for anyone looking out to earn a living. For most people, the stage they eventually venture into is determined by the start-up capital available to them.
Start-up capital is important in any business, not just the plastic recycling business. If you have no start-up capital, you probably will end up at the collection stage. If you have very little capital, the sorting stage will be your best bet and if you have some good amount of money, you may want to involve yourself at the processing stage.
This article is intended to guide you on how to start your own plastic recycling business in South Africa.
It will walk you through every stage involved in the business, the capital needed and the right mindset towards succeeding in the business.
Starting a Plastic Recycling Business in South Africa
Most times, people venture into business simply because they hear that it is lucrative and then suddenly end up with losses and debts on their hands. That doesn’t mean that the business is not as lucrative as people said it was.
The truth is, almost every business idea that comes to your mind and somebody is already earning a living from, is ‘lucrative’ enough. It could grow to provide you with more money than you’ll ever need with expansion.
But then, many people venture into these businesses without learning the ropes or how these things work before putting their hard earned money on the line. Without learning the ropes in any business, you’re bound to fail except by fate.
Plastic recycling business involves three stages as stated earlier: the collection stage, the sorting stage, and the processing stage.
The Collection Stage
The collection stage of plastic recycling is the most labour intensive part of the business. It requires manual labour and most often zero capital. This is the stage most of us will ever witness and some passively without ever being aware of the complex processing running behind the scene.
Remember those boys you often see going about picking water bottles from dump sites and waste bins?
You mean those jobless, haggardly dressed, and probably homeless boys with bags slouch on their shoulders or pushing those open-top iron carts collecting bottles from waste bins?
Yes, I mean those.
They are the key players in this stage. Although they may often appear dirty, haggardly dressed and maybe often hungry, they are by no means jobless!
The collection stage probably may not look attractive to you but it provides a way for those without capital to earn a living.
The good news is, if you have the capital, you can skip this stage of the business. But it is important that you know about it. When these collectors collect plastics from waste bins and dump sites, they sell it to those in the sorting stage.
Most times, a kilogram (1 kg) of plastic bottles is bought from the collectors within the price range of N20 – N25. So as a collector, if you could get up to 50kg of plastics in a day, you can make up to R$ 37 per day and around R$ 925 to R$ 1,110 per month.
The Sorting Stage
The second players in the recycling industry are the group I like to call the sorting stage. This stage is the most popular point of entry into the recycling business for most people. This is because it is quite easy and requires little effort. However, it requires attention to details, knowledge of how the business works and capital.
The players in the stage buy the plastic wastes from the collectors and sell them to the processing industry. The difference in the cost and selling price is their profit. Sounds easy, right? It should.
Well, everything is easier said than done. To prosper in this stage, you’ll need to find collectors who will go about picking plastic from dump sites and then sell them to you. As such, you’ll need a start-up capital that will enable you to buy the plastics from the collectors in large quantities.
Most times, the collectors cannot sell their pickings directly to the processing plant because those only buy in large quantities, which will take the collectors days to pick.
As such, you’ll be acting as a middle man. The capital requirement for this stage is fluid. It depends on the quantity you want to buy which, in turn, will be dictated by the minimum requirement of the processing plant you intend selling them to.
Most processing plants buy a kg of plastic bottles within the price range of N25 – N30. So, if you buy 10,000kg from the collectors at the price of N20 per kg, you’d have spent R$ 740 and when you sell them to the processing plant at the price range of N25 – N30 you’d have earned about R$ 925. The price difference will be your profit but don’t forget to add the cost of transportation (you’ll bear the cost of transportation). The money is in constant trade and expansion.
The sorting stage doesn’t have to involve only buying and selling. For instance, if you can sort all the plastic bottles into different types, your earning will increase up to N75 per kg.
Also, if you can invest in a baling and cutting machine to bale the plastics before shipping them off to the processing plant, your earning will also increase per kg. And if you can cut them before sending them to the plant, your earning will again increase. These, of course, will increase your start-up capital.
The Processing Stage
The processing stage is where collected plastics are finally converted into usable products again by industries. These industries require waste plastics as their raw material for production. They mostly include the plastic chair and table industries, the plastic cup industries, and the plastic plate industries.
The processing stage is both labour and capital intensive. You’ll need capital to purchase processing machines and capital to hire workers who will operate the machines as well.
These machines are mostly imported into the country.
So as a processing plant, you need the capital to purchase waste plastic bottles from the collectors or those in the sorting stage and then capital to purchase the machines used for processing. The start-up cost for this stage of the business is usually a huge amount of money.
Plastic recycling business is a lucrative enterprise just about anyone willing to learn the rope and make money can venture into. Of course, you can choose to combine all the stages together and run the business from the collecting stage to the processing stage if you have the money and the tenacity for it.
Starting a profitable plastic recycling business in South Africa can be a rewarding venture. The country generates a massive amount of plastic waste every year, and recycling plastic not only helps the environment but can also create a stream of income for you. Here’s how to get started:
How to start a profitable plastic recycling business in South Africa
|Research the market and identify a profitable niche
|Write a solid business plan
|Choose the right location with ample space and good infrastructure
|Secure funding and necessary licenses
|Procure the necessary equipment and materials
|Evaluate and implement a waste collection process
|Develop a production process and execute
|Build a network of loyal customers
|Monitor and optimize your business regularly
Starting a plastic recycling business requires hard work, but it can be a profitable venture if done right. By following these steps, you can build a successful plastic recycling business that helps the environment and generates income for you.
The plastic recycling business is a growing industry globally, with an increasing demand for recycled products. In South Africa, demand is also on the rise, and there is plenty of room for new entrants. By following the steps outlined above, you can start a profitable plastic recycling business and contribute to environmental sustainability while creating a stream of income for yourself.