Are you seeing your rebate - or your service provider - disappear?
As your used cooking oil value goes down, so do the fly-by-night grease guys.
Collecting used cooking oil is all about offering a service. Period. Some service providers will say it’s about the extra penny a pound they can pay you for your grease, and we realize that’s a tempting proposition. But it doesn’t always pay out the way you’d expect.
If you’ve been having someone pick up your used cooking oil for a few years, you know that your rebates will vary. As demand for yellow grease (or processed used cooking oil) increases, so does its value. Unfortunately, that’s exactly when unscrupulous grease peddlers regularly enter our industry, thinking they can make some easy money when the value of your oil is highest. They can promise you that slightly higher price point because they have so little invested in their business.
The UPs and DOWNs of the used cooking oil business.
The past few years have been good for the yellow grease market, and both DAR PRO and our restaurant and supermarket customers have enjoyed that benefit. So have the newcomer independents and garage-based biodiesel producers… some of whom invested in a small fleet and tried to make a legit go of it, as well as those who simply put a pump and barrels in their cargo van and called it done.
But, like we’ve seen with our stock market recently, what goes up does eventually go down – at least for a time. That’s what is happening now with used cooking oil – demand has lessened so its value has dropped. Service providers are making less money selling the used oil they collect, but their costs to provide that service remains the same. It’s harder for them to find buyers for the oil they have to sell. The “easy money” is getting harder to find.
What does that mean to you?
An obvious first effect is It likely means lower rebates until the market comes back up. But, it could also mean you’ve noticed your grease bin is almost overflowing and your grease collector is a no show and not answering your calls. Joe Blow’s BioD decided there was better money in dog chauffeuring.
"As a long-time Wendy's franchisee, I've seen the yellow grease market move over the years," said Eddie Rodriguez, Chairman of Wendy's JAE Restaurant Group. "At least one time, I followed the market and changed from DAR PRO to another service to remove my used cooking oil. As happens, the market fell, and my new guy wasn't able to provide the same level of service I expected. I've moved back to DAR PRO and am now committed to staying with a company I can trust."
For those finding themselves toe deep in grease overflow with no one to pick it up – we’re here to say you DO have someone to call who will answer the phone… 24/7/365! DAR PRO Solutions has the experience to power through the ups and downs of market cycles, and is backed by a company that’s been in business over 135 years, with the infrastructure and diversity to ensure our customers can trust we’ll be there today, tomorrow and beyond.
“After many years with Darling Ingredients, I’ve been through some of the best and the worst of the yellow grease market. There were times when grease value was so low and fuel costs so high that we were forced to charge for grease pickup until the markets improved,” said Mike Molini, Sr. VP Midwest Operations, Darling Ingredients.
"During every high cycle, we see a significant increase in competition, and it becomes impossible for us to match them penny for penny and still run an efficient operation. We value our reputation for the reliable service we provide our customers, and they understand that we will be there through those low times when many of the newbies to the industry leave to find some new business venture…often without any notice to the restaurants they are abandoning.”
DAR PRO retains our loyal customers because of the reliable, efficient service we offer… because we will be there when they need us… because we won’t fold our doors when things get tough. We've got this!
Do you need a new service provider, or want to discuss how a professional service partner really can make your business run more efficiently with less worries? Let’s talk!