The average manufacturer wastes $140,000 on environmental compliance

We break down environmental compliance spend and how manufacturing leaders can save up to $140,000 annually.

But there’s one line item that’s long gone unnoticed in industrial operations: environmental compliance.

In this article, we’ll break down the three areas of waste, and calculate three alternative scenarios using an example of a 10-site operation. 

This article is based on our proprietary tools, the Environmental Compliance Costs Calculator, and the Mapistry Penalty Explorer. 

Understanding the 3 biggest sources of environmental compliance waste

1. Paying six-figure employees for admin work

The average environmental manager in the U.S. makes $97,321. Including benefits and taxes, the fully-loaded costs for this role are closer to $136,000, depending on your company's compensation packages (source).

After 11 years of speaking to hundreds of environmental managers in manufacturing, we estimate that environmental teams spend 40 to 60% of their time on repetitive grunt work such as:

• Entering data into spreadsheets (e.g., production data, sensor readings, lab results)
• Collecting, scanning, and filing paperwork (e.g., inspection forms)
• Following up on corrective actions and to-dos

That’s up to $81,600 of labor costs going toward admin work – per environmental employee.

In the 2010s, this wouldn’t have raised any eyebrows. But in the age of AI and automation, paying six-figure salaries for data entry is the equivalent of lighting money on fire.

2. Frontline workers on environmental payroll

EHS salaries are easy to keep track of because they can be directly attributed to environmental compliance. 

For operations, that’s a different story. Everyone in operations knows compliance is a pain, but does anyone know how much time they’re spending on tasks such as

• The daily, weekly, monthly, and annual inspections completed by your frontline workers (12,000 per year in the case of MMC Materials)?
• The thousands of data points that get tracked in Excel spreadsheets by plant managers?
• The downtime caused by surprise inspections?

Based on our ROI calculator, a 10-site facility spends $173,000 on operations labor related to environmental compliance tasks. More on this below.

3. Preventable EPA fines

The average EPA penalty for industrial facilities is $154,826 (source: EPA Penalty Explorer), plus legal fees. The more complex your permits, the higher your risk.

Without a reliable compliance system, penalties should be factored into your compliance budget. 

In reality, they’re overlooked.

What are the alternatives? How to save $140k per year

The question you’re likely left with is, “Okay, but what do I do?”. 

There are three options you could consider:

1. No change: Stick with the status quo. Usually that means hiring more people.
2. Stop doing compliance: Pretty risky, but it’s an option.
3. Software: Automate repetitive tasks and digitize compliance, e.g. using Mapistry.

We’ve helped over 1,200 industrial facilities in the U.S. automate their environmental compliance, such as Graniterock, MMC Materials, or Walbec Group.

Based on our experience, we’ve created a calculator that compares the cost of each scenario based on your input. Below, we calculate the results for a common scenario.

Saving $140,000 annually with automation

For a 10-site facility with two environmental employees and a mix of high, medium, and low complexity, the environmental compliance costs break down as follows.

For the sake of simplicity, we won’t include EPA penalties into this calculation, since it’s impossible to reliably predict the penalties you’ll have to pay every year. To get an idea for the average penalties in your industry, please use the Mapistry Penalty Explorer.

Ready to cut costs? Let’s talk about it.

If you’re considering automating and digitizing your environmental compliance program, let’s have a conversation about how we can help, and what the payback period for your operation could be.

You can book a time with our sales team here.

Want to see what your savings could look like? Use our free calculator.