The Rise of Reusable Packaging: Understanding the Impact & Mapping a Path to Scale
The exponential growth of e-commerce, coupled with optimised global supply chains has meant that we are consuming more packaging than ever.56 Whilst the current system of single-use plastic provides a low-cost and highly functional solution, it often comes at the expense of the environment. Increased consumption of packaging is fuelling the continued extraction of fossil-derived raw materials, whilst low recycling rates for flexible plastic packaging are leading to the generation of huge amounts of plastic waste.
Fortunately, there is unprecedented interest in new packaging materials, new business models and new technologies that are spearheading the transition towards a more sustainable and circular packaging industry.57 At the forefront of this are closed-loop reusable systems, which reorient packaging from a linear model of ‘take-make-dispose’ into a circular multi-use asset that is returned and reused on multiple occasions.
This research demonstrated the clear impact case for reusable packaging, in some instances presenting more than an 80% reduction in CO2 eq emissions compared with a single-use alternative. However, it also shed light on the nuance in the system – there are a number of variables that have the capacity to drastically influence its impact:
- Overall transportation distances – shorter transportation distance from DC to customer, and customer back to the cleaning node in the reusable system reduces overall carbon emissions
- Return rates of reusable packaging – high rates of return keep reusable packages in circulation for longer – dividing the material impact over multiple cycles thus reducing the carbon footprint
- Centralised versus decentralised system – bringing cleaning and maintenance in-house within the reusable system reduces transportation distances and carbon emissions
- Type of single-use packaging used – if single-use packaging is to be used, packaging with high recycled content should be used to reduce emissions associated with the manufacturing stage
CALL TO ACTION
Specific actions must be taken by all stakeholders in the value chain to ensure that reusable packaging scales in an environmentally and economically viable manner. The path forward can be grouped into three actions that should be pursued simultaneously:
The most important factor influencing the viability is the return rate of reusable packaging. Maximising return rates requires a fundamental change in behaviour from consumers so assistance and education must be provided.
- Brands and retailers should give simple and clear instructions on how to return the packaging, as well as educating consumers through compelling programmes on the importance of reusable packaging more broadly.
Given the relative nascency of reusable packaging in the fashion e-commerce sector, more can be done to optimise the offering.
- Innovators should work to increase the recycled content of the reusable packaging to 100% and bring all cleaning and maintenance in-house to further improve the environmental case.
- Working to integrate cleaning and maintenance within the DC also requires significant collaboration between innovators, brands and 3PL companies – thus highlighting the interrelatedness of the actions that must be pursued.
- The whole value chain should work together to increase the density of drop-off points to enhance convenience – putting customer-centricity at the heart of the system.
Transitioning to reusable packaging is a systems-level change that requires buy-in from all stakeholders across the value chain.
- Brands and retailers should pilot with reusable packaging innovators and 3PL companies to test and iterate on applicable processes to fit their supply chain needs. No one company or innovator can instigate the change alone — it requires collaboration with all relevant stakeholders to move the needle forward.
THE IMPACT CASE IS THERE.
It now requires education, innovation and collaboration throughout the value chain to bring reusable packaging to scale.