The Things to Consider When Planning on Starting a Scrap Tire Business
In certain geographic areas, there are not sufficient markets or processing capacity to handle all the scrap tires generated. In these situations, an entrepreneur may consider the possibility of entering into the scrap tire business. Depending upon the situation, the business opportunities could exist for the entrepreneur to collect, transport and/or process tires. While opportunities may exist, it must also be noted that this is not a business without risk, especially for those entrepreneurs who are not properly prepared for the challenges that will be encountered.
When starting a scrap tire company there is a series of business decisions that must be given extensive research. These decisions will be based on a series of factors, all of which must be fully explored before each decision can be made. Often, later decisions will be a function of decisions made early in the planning process.
The information provided in this document was developed as a tool, designed for a “newcomer” to environmental related businesses. This tool is not designed for established businesses in the environmental arena; but rather a tool for beginning a small to medium size scrap tire business. This tool can also assist local governments in evaluating concepts for scrap tire businesses. The “considerations” contained herein provide general guidance to the entrepreneur in the decision making process. The specifics of any given situation may vary; in all cases sound business practices should be applied. The information provided also includes some industry “rules of thumb”; general business practices that have been proven to be useful, but not scientifically proven. Once again, these “rules” are provided for guidance purposes.
As a starting point, it must be recognized that the scrap tire business is just that: a business. While providing a service for scrap tires may be good for the environment and/or may be gratifying for other reasons, it must still be considered as a business.
QUICK U.S. SCRAP TIRE FACTS
Number of scrap tires generated annually (2004): 289 million
Scrap tires as a percentage of total solid waste generated: (2000): 1.8%
Number of scrap tires in stockpiles (2004): 240 million
Number of scrap tires going to a end use market (2004): 246 million
Number of scrap tire processing facilities (2004): 498
Number of scrap tires used as tire-derived fuel (2004): 125 million
Number of facilities using tire-derived fuel (2004): 85