Effective resource management will involve good waste management. It's in the interests of a business to minimise waste, since more waste means more costs per unit. These costs can take a number of forms:
- Financial costs. The most obvious cost involved in throwing away resources is the money that's been spent on purchasing them. Ensuring that the production process makes the most of every raw material used means that costs are minimised.
- Opportunity costs: The money that has paid for the wasted materials could have been used elsewhere in the business.
- Social costs: Waste has to be handled and managed and this imposes costs on society. For example, waste that's disposed of in landfill sites may be an eyesore to the local community.
- Environmental costs: These include air pollution from incinerating waste, water pollution from discharging it into rivers and groundwater pollution from burying it.
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