What is the cost associated with starting a plastic recycling venture

What is the cost associated with starting a plastic recycling venture


Plastic recycling is a profitable business idea that not only generates income but also contributes to environmental sustainability. With the world’s increasing focus on combating climate change and preserving natural resources, there is a growing demand for plastic recycling.
According to a recent report, the plastic recycling market is projected to reach $53.72 billion by 2026, with a compound annual growth rate (CAGR) of 6.7%.

Starting a plastic recycling business requires significant investments in terms of time, money, and resources; however, it can have substantial positive impacts on both the environment and the economy in the long term.
In this blog post, we will outline the startup expenses associated with starting a plastic recycling business in the United States.

Before delving into these startup expenses, let’s first explore some of the benefits of recycling plastic.

Reduces plastic waste: Recycling plastic waste helps decrease the amount of plastics ending up in landfills and oceans, thereby protecting wildlife and preserving our environment.
Conserves natural resources: By recycling plastics, we conserve valuable resources like crude oil while also reducing energy consumption required for manufacturing new plastics.
Saves money: Recycling plastics can lead to cost savings for businesses by reducing raw material costs as well as waste disposal fees.

Now let’s move on to discussing the specific startup expenses involved in establishing a successful plastic recycling business.

Startup Costs

When starting a plastic recycling business, it is important to consider the various startup costs involved in order to ensure a successful launch. Below are the average costs associated with each essential component of a plastic recycling business:

Startup Cost ItemAverage Cost Range (USD)
Land and building acquisition or rental costs for facility$50,000 – $300,000
Purchase of recycling equipment and machinery$200,000 – $500,000
Raw material purchasing costs for collecting plastic waste$10,000 – $50,000
Transportation costs for collecting plastic waste$5,000 – $20,000
Employee training and certification costs$2,500 – $10,000
Marketing and advertising costs$10,000 – $30,000
Legal and regulatory compliance costs$5,000 – $15,000
IT infrastructure and software costs$5,000 – $20,000
Insurance and contingency funds$10,000 – $50,000
Total Startup Costs$300,000 – $1,000,000

Commencing a plastic recycling business necessitates a substantial initial investment. Nevertheless, with a well-developed business plan and dedication to sustainability, this venture can ultimately prove profitable and rewarding.

Land and building acquisition or rental costs for facility

The cost of acquiring land and buildings or renting facilities for a recycling facility depends on various factors such as location, size, and condition. According to the latest data, the average cost of industrial land in the US is $75,000 per acre. This cost may vary significantly depending on location availability in the area.
For building or renting a facility, the average cost per square foot ranges from $50 to $150 depending on building type/location/condition. A recycling facility typically requires ample space for storing and processing waste materials which significantly increases acquisition or rental costs.
For example,a 10k sq ft facility in Manhattan,NY costs around $3 million for acquisition while its monthly rent could be approximately $85k.In contrast,a similar facility in a less expensive location like Texas may cost around $1.5 million for acquisition with monthly rent at about $35k.However,buying/renting a facility in remote areas/undeveloped regions might be cheaper.
It’s crucial to consider location & size when estimating costs associated with acquiring/renting a recycling facility.Generally,larger facilities tend to be pricier whereas smaller ones offer more affordable options especially for startups.
In conclusion,the expenses related to acquiring/renting facilities for plastic recycling businesses can vary considerably based on location,size,and condition.Entrepreneurs should also factor in other elements like taxes/utilities/maintenance costs when estimating total investment required to start a recycling business.

Purchase of Recycling Equipment and Machinery

The cost of purchasing recycling equipment and machinery is a significant expense when opening a plastic recycling business. According to the latest statistics, the cost can range from $150,000 to $500,000 USD for a standard plant capable of processing approximately 500-1000kg of waste plastic per hour.
This cost includes essential equipment purchases such as shredders, conveyor systems, mechanical separators, washing tanks, and drying equipment.
Depending on the recycling model used by each plant may require additional machinery like granulators or extruders or injection molding machines that can increase the overall equipment costs.
Furthermore,it’s crucial to acquire machinery that meets specific recycling needs. For example,some plastic types require specialized equipment for polymer separation from contaminants while others need unique heating profiles for melting into new products.
Therefore,diligent research and consultation with industry experts are critical in selecting appropriate machinery,equipment,and technology for a plastic recycling business.
Investors should consider factors such as total ownership costs,maintenance requirements,and potential upgrades or replacements.
Lastly,purchasing used equipment is an option for those seeking cost reduction.However,it’s important to thoroughly assess its condition,warranty coverage,and financing options.Additionally,the installation costs along with any necessary upgrades or repairs should also be considered when calculating the overall expenses involved in getting the equipment operational.
Examples of some essential equipment needed by a plastic recycling business:
-Conveyor systems
-Mechanical separators
-Washing tanks
-Drying equipment
-Injection molding machines

Raw material purchasing costs for collecting plastic waste

Raw materials are crucial in any manufacturing industry, including plastic recycling. The cost of raw materials directly impacts the profitability of the business.
The price of raw materials like plastic waste depends on factors such as location, availability, demand, supply, and quality.

In the US market, the average cost of purchasing plastic waste is approximately $330 per ton. However,the price can vary depending on the material’s quality. Lower-quality plastic waste that is contaminated or mixed may have a lower cost compared to high-quality plastics that are clean and sorted.
Additionally,the cost can also differ based on where the waste is collected. Areas with high demand but fewer suppliers may quote higher prices than areas with less demand but more suppliers.

Businesses have various sources from which they can procure plastic waste,such as recyclers,waste management companies,and even households.
Procuring plastic waste from households can reduce costs since it is abundant and does not require additional transportation expenses.However,this process might be time-consuming,and businesses need efficient methods for collecting and sorting the plastic waste.

Another option is collaborating with local businesses like supermarkets,
restaurants,and hotels to obtain their plastic waste.This source often provides reliability,but it may come at a higher cost per ton since these businesses prioritize convenience over saving money.

Having a clear procurement strategy in place ensures consistent access to reliable raw materials without exceeding budget constraints.It’s important to build long-term relationships with suppliers while maintaining high-quality standards; this approach can lead to long-term cost savings.

To summarize:

  • Procuring plastic waste in the US can cost around $330 per ton.
  • The cost varies based on material quality and collection location.
  • Plastic waste can be obtained from households and local businesses.
  • Developing efficient methods for collecting and sorting plastic waste is crucial to reducing costs.
  • Building long-term relationships with suppliers and maintaining high standards can result in cost savings.

Transportation costs for collecting plastic waste

The transportation costs for collecting plastic waste can vary depending on the location, distance, and volume of the material. Recent statistical information suggests that companies involved in plastic waste collection and processing can expect to pay approximately $100-$150 per ton solely for transportation.

Furthermore, factors such as fuel and labor costs can also impact overall transportation expenses. For instance, a company situated in a rural area may incur higher fuel expenses compared to one located in an urban center.
Additionally, labor costs might increase if the company needs to cover longer distances by paying overtime or hiring additional workers.

However, companies have the option of reducing transportation costs by collaborating with other businesses operating within the same region.
Through this approach, transportation expenses can be shared between companies while simultaneously benefiting from cooperation efforts aimed at environmental protection.

Another strategy available for cost reduction involves investing in more efficient and eco-friendly vehicles. Electric vehicles and alternative-fuel trucks offer potential savings on fuel expenditure while also contributing towards lower carbon emissions.
For example purposes only: Rumtoo Recycling Company operates in rural Texas where it transports its collected plastic waste 150 miles away to the nearest processing facility. With ten trucks covering a total daily distance of 1000 miles,
assuming an average fuel consumption rate of 5 miles per gallon at current fuel prices of $2.50 per gallon,
the estimated daily fuel cost per truck would amount to around $250 resulting in a total daily fuel cost of $2500 for the company.

For example purposes only: ABC Recycling Company has formed partnerships with several businesses located within the same city block to share transportation expenses.
By establishing a schedule for picking up each other’s recyclable materials on specific days, all participating companies have significantly reduced their transportation costs.

Employee training and certification costs

Employee training and certification costs are crucial expenses when starting a plastic recycling business. It is vital to ensure that every employee receives the necessary training and certification required for handling the recycling process properly.

The cost of training and certification can vary depending on the specific type of training needed. Costs may range from $500 to $2000 per employee. We recommend implementing a comprehensive training program that covers various stages of the recycling process for new hires.

In addition to training costs, employers may also incur expenses related to certifications. Certification ensures that employees possess knowledge in handling different types of plastics effectively while being prepared for unexpected situations during the recycling process.
Certification costs can range from $1000 to $3000 per employee.

It’s important to note that both training and certification costs are one-time expenses but play a critical role in determining your business’s success. Properly trained employees with certifications guarantee consistent production of high-quality recycled products.

Another cost worth considering is recurrent training fees along with updating certifications regularly. The recycling industry constantly evolves with new practices and techniques emerging frequently.
Therefore, scheduling recurrent trainings at regular intervals becomes essential in keeping employees updated about the latest industry trends. This expense can amount from $500-$1000 per employee annually.

Lastly, employers should allocate funds towards providing personal protective equipment (PPE) for their employees’ safety during the recycling process.
PPE costs vary based on specific equipment requirements but should never be overlooked as an additional expense.

Training costs: $500-$2000 per employee
Certification costs: $1000-$3000 per employee
Recurrent training and certification updating costs: $500-$1000 per employee annually
Personal protective equipment costs: varies depending on equipment required

In conclusion, the cost of employee training and certification is a crucial factor that should not be underestimated when establishing a plastic recycling business.
Implementing standardized training programs and certifications ensures employees are equipped to handle various stages of recycling. Regularly updating trainings and certifications keeps employees up-to-date with the latest industry trends and practices.
Employers must allocate funds for PPE to prioritize employee safety during the recycling process.

Marketing and advertising costs

The marketing and advertising costs for a plastic recycling business can vary depending on the size of the business, target audience, and advertising methods used.
According to recent statistical data, the average marketing budget for most small businesses in the US ranges from $2,000 to $5,000.

However, a plastic recycling business may require more extensive marketing efforts to attract customers effectively.
One effective way to market such a business is through social media platforms that allow targeting specific groups interested in environmental issues. The cost of social media advertising can range from $1 to $3 per click based on competition in the market.

Another effective method of advertising is through local newspapers and classified advertisements. These approaches are relatively inexpensive with classified ads costing between $25 and $200 per week depending on newspaper circulation.

For larger plastic recycling businesses aiming at attracting customers while establishing their brand presence in the market may require a marketing budget ranging from $10k-$20k. This budget can cover traditional methods like billboards or radio ads as well as digital strategies like pay-per-click ads on search engines.

It’s crucial for plastic recycling businesses to invest in marketing & advertising efforts that establish strong brand presence & attract customers. It’s recommended allocating an appropriate ad budget based on specific needs & target audience.
Below is a list of recommended marketing & advertising costs:

  • Social media advertising: $1-$3 per click
  • Local newspaper classified advertisements: $25-$200 per week
  • Billboards: $3,000-$5,000 per month
  • Radio ads: $500-$2,000 per week
  • Pay-per-click ads: $1-$5 per click

Costs of Legal Compliance with Regulations

Starting a plastic recycling business involves significant costs associated with legal compliance. It is necessary to comply with federal, state, and local regulations in order to operate a legal and sustainable business.
Total legal costs can range from $10,000 to $50,000 or more.

Businesses involved in recycling hazardous wastes are required by Environmental Protection Agency (EPA) regulations to obtain permits, pay fees, and adhere to certain standards. EPA permits can cost anywhere from $3,000 up to over $15,000 depending on the state.
Additionally,the EPA requires businesses to maintain records and submit annual reports. The cost of compliance can range from $2,000 t o $5,000 per year.

Occupational Safety and Health Administration (OSHA) regulations mandate that businesses provide employees with a safe work environment. Compliance costs related OSHA regulations can range from $500 up t o$5,000 per year.
Furthermore,businesses need t o conduct employee training an d purchase safety equipment which may cost up t o$10,000 or more.Insurance is another compliance cost that plastic recycling businesses need t o consider.Businesses must obtain liability insurance in order protect themselves against any potential legal claims arising from operating a recycling facility.
The cost of liability insurance ranges between $2,000and$10,000 per year.

Example 1: A plastic recycling business in Los Angeles obtained its EPA and OSHA permits, which cost them $15,000 and $3,000 respectively.
Example 2: A plastics recycling startup in New York City had to spend $5,000 on safety equipment and employee training to comply with OSHA regulations.

IT infrastructure and software costs

Setting up a plastic recycling business involves using appropriate IT infrastructure and software for inventory and supply chain management, accounting, and customer management systems. According to available data, you need to allocate at least $10,000 for IT infrastructure and software costs.

However, the costs for IT infrastructure and software can vary depending on the type and size of the recycling business. For instance, a small-scale plastic recycling business that involves manual sorting and processing may not require complex IT infrastructure and software.
Whereas, a large-scale plastic recycling business that involves automated sorting and processing may require more sophisticated IT infrastructure and software.

It is essential to invest in the right IT infrastructure and software to ensure a smooth and efficient recycling process as well as to keep the business running in an organized and efficient manner.
So, it is advisable to purchase the latest software licenses and hardware equipment to manage the operations of your business smoothly.

  • Software costs: The required softwareforplasticrecycling businesses includesaccountingsoftware,inventoryandsupplychainmanagementsoftware,andcustomermanagementsoftware.
    Thecostofthesesoftwarelicensesvariesdependingonthefunctionalitiestheyoffer.Generally,the softwarecostsrange from$500to$2,000perlicense.
  • Hardwarecosts:The hardwarecostsinvolvethepurchaseofdesktops,servers,scanners,printers,andothercomputerperipherals.
    The costofthehardwareequipmentdependsonthetypeandsizeofthebusiness.Generally,the hardwarecostsrange from$5,000to$8,000forabasicITsetup.
  • IT maintenance costs: IT maintenance costs include expenses such as software upgrades, hardware maintenance, and data backup and security. The IT maintenance costs generally range from $1,000 to $2,000 per year.

It is important to keep in mind that IT infrastructure and software costs are a recurring expense. Therefore, it is advisable to include these costs in your budget and allocate enough funds to ensure smooth operations of your plastic recycling business.


Starting a plastic recycling business can be both challenging and rewarding. It not only helps reduce environmental pollution but also has the potential to generate substantial income by producing high-quality recycled products for manufacturers and consumers.

To start a plastic recycling business, it is important to consider various startup expenses. These include acquiring or renting a facility, purchasing recycling equipment, and obtaining plastic waste. Creating a budget should also take into account training and certification, transportation, marketing, legal compliance, IT infrastructure and software, insurance, as well as contingency funds.

Although the initial investment may seem significant, it is crucial to consider the long-term benefits of plastic recycling. This includes reducing plastic waste, conserving natural resources, and saving money. The projected market size of $53.72 billion by 2026 indicates the industry’s growth potential.

If you are interested in starting a plastic recycling business, we recommend conducting thorough research, developing a detailed business plan,and seeking guidance from experienced professionals who can assist you throughout the startup process. By doing so,you can increase your chances of success in this lucrative industry.


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