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Reusable Container Service Loop Teams With Tesco to Enter U.K.
The pandemic could have ruined this sustainable business. But instead, it's expanding nationwide.
TerraCycle
pepsico
Nestle
Unilever
Include USA
UPS
Procter & Gamble
Tide
Loop
Clorox
Häagen-Dazs
When the coronavirus pandemic hit the United States, local governments and big companies quickly changed their tune on reducing single-use plastics. They started prohibiting cloth totes in grocery stores and rejecting reusable coffee mugs at cafes. They embraced disposables once again, seeing them as the safer, more hygienic option.
Maine delayed its plastic bag ban from April 2020 to January of next year. San Francisco in March instructed businesses to bar customers from using their own bags, mugs or other reusable items in order to promote social distancing. Meanwhile, Starbucks (SBUX) stopped allowing people to use their own mugs, and McDonald's (MCD) decided to close self-serve soda fountains as it reopens its doors.
For Loop, a shopping service that sells items from Häagen-Dazs ice cream to Tide laundry detergent in reusable packages rather than the single-use containers that normally hold the products, consumer fears around reuse could pose an existential threat. But instead of retreating during the pandemic, the project has reported sudden increases in sales and is about to expand in a big way. Loop, which launched as a pilot last year in the Northeastern US and Paris, is planning to expand to the 48 contiguous states by July 1.
This CEO is on a Mission to Eradicate Single-Use Packaging
When Tom Szaky dropped out of Princeton in 2002 to start a company, TerraCycle, that made fertilizer out of worm poop, a lot of people were skeptical. Why not start a web company like that other guy, Mark Zuckerberg? “They expected a male college student to start a dot-com,” Szaky says. “Garbage and waste management wasn’t nearly as sexy.”
But in garbage—or at least the management part of it—Szaky saw a path for change. Over the next 18 years, his company TerraCycle moved well beyond worm poop, taking on some of the toughest recycling challenges—cigarette butts, dirty diapers, used coffee capsules—that no other operation would go near. Szaky is even tackling the problem of plastic pollution in the ocean, 8 million metric tons of which accumulates annually. He’s turned a profit by transforming that trash into shampoo bottles, among other things. To date, TerraCycle has recycled 310 million pounds of plastic from the ocean.
Something was still nagging Szaky, though. “Recycling is really important, but it’s not the answer to garbage,” he says. “It’s an answer to the symptom”—the equivalent of, say, taking a Tylenol when you have a headache. Szaky wanted to eliminate the headache in the first place.
So last year he launched Loop, a “circular shopping platform” that offers top consumer brands in reusable metal and glass packages. Customers buy a pint of Häagen-Dazs or a bottle of Tropicana OJ and instead of throwing away or even recycling the package when they’re done, they return it to Loop, which cleans, sterilizes and refills it to be resold—resulting in a much smaller environmental footprint.
Brands have signed on in droves—55 at latest count—as have some of the country’s largest retailers, including Kroger supermarkets. “People want to change, but there aren’t solutions out there for them—not everyone can be a Brooklyn zero waster,” said Szaky. “The biggest lesson we’ve learned is that you have to meet people where they are.”
3 Reusable Packaging Perspectives from Popular Brands
Executives from The Clorox Co., Nestlé and entrepreneur Soapply share insights into the sustainability and cleanliness of reusable packages for products sold through Loop’s shopping platform, especially in a post-pandemic world.
Last year, recycling/upcycling firm TerraCycle launched Loop, a shopping platform for zero-waste-packaging products, with the support of some of the world’s biggest brands (see “Loop and big brands boldly reinvent waste-free packaging.”) Together, the eco-commerce provider and the brands have learned that there is indeed a market of consumers who will by Crest mouthwash, Tide laundry detergent, and myriad other products from Loop’s online store — then return their empty packages to be cleaned, refilled, and reused.
Since its early 2019 introduction, Loop’s business has grown from a direct-to-your-doorstep model with regional service to testing of mass-market retail partnerships to imminent national coverage. Retail partners include Kroger and Walgreens in the US market, Canada’s Loblaws, and the U.K.-based Tesco chain. Germany and Japan are on the horizon, too.
Companies will have to get creative to advance sustainability amid crisis
Evidence that consumers care
A growing number of consumers — along with employees and investors — want to associate with brands whose values they identify with. According to a global consumer survey by the Conference Board, about two-thirds of respondents have bought brands because of their environmental practices, more than half have dropped brands because they don’t provide fair labor conditions, and a significant share have at some point either switched brands or moved away from brands because of the social causes they support. Dichotomy in consumer motivation — between caring about a cause but also about functional features and price — makes pursuing a sustainability agenda complicated. Soon-to-be-published global PwC research shows that consumers think government bears the biggest responsibility for encouraging sustainable behaviors and lifestyles. Those surveyed put themselves in second place, right after the government and ahead of manufacturers/producers, retailers, and other institutions. The survey also found an increase in the number of people making sustainability-conscious decisions year over year. The percentage of survey respondents who avoid plastics when possible rose from 41 percent to 45 percent, and the percentage of those who consciously choose sustainable ways to travel rose from 28 percent to 32 percent. People’s purchasing choices don’t always fall in line with their attitudes about sustainability, but recent purchase data indicates that in some categories, words and actions more or less align. In the U.S., the percentage of overall store sales made up of sustainable consumer packaged goods (CPG) grew from 19.7 percent in 2014 to 22.3 percent in 2017, and is expected to reach 25 percent by 2021. Sales of products with on-package sustainability claims, such as USDA Organic or “no phosphates,” grew almost six times fasterPDF than conventional products from 2013 to 2018 (up 29 percent), accounting for about half of all CPG growth despite the category’s small market share. However, the Conference Board’s global consumer research shows that shoppers have considered sustainable features to be more an appreciated bonus than a core purchase driver. For example, environmental impact ranks only fifth among surveyed consumers’ decision criteria for daily mode of transportation, after speed to destination, cost, convenience, and safety. As Warby Parker cofounder and co-CEO Neil Blumenthal put it in an interview with Inc. magazine, “While customers certainly love the fact that we give back, at the end of the day, it’s not a critical factor in deciding whether to buy a pair of glasses.”How companies can respond
This dichotomy in consumer motivation — between caring about a cause but also about functional features and price — makes pursuing a sustainability agenda complicated. Yet, doing so can help to differentiate a brand, delight customers, and ultimately create brand and financial value. Those looking to market sustainable offerings should consider the following suggestions. Couple sustainability features with other benefits. Companies can innovate, creating sustainable products and services superior to unsustainable alternatives. For instance, recycling company TerraCycle offers a circular packaging and delivery system called Loop that sends customers products in well-designed containers that can be returned for cleaning and reuse. Many companies, including leading ice cream, shampoo, and mouthwash brands, are part of the program. Consumers have to pay a deposit that’s sometimes double the product price, but people don’t mind. Why? Two-thirds of Loop shoppers indicate that the higher-end aesthetics and functionality of the containers are actually more important to them than the program’s sustainability benefits. For example, Häagen-Dazs’s dual-layered Loop cups keep ice cream frozen but aren’t too cold to hold comfortably, and the containers’ rounded bottom corners makes scooping easier. The fact that the Loop system is eco-friendly is a bonus. Paul Gaudio, global creative director for Adidas, explains the sustainability-as-a-bonus philosophy this way: “I don’t want people to buy it because it’s recyclable. I want people to buy it because it’s awesome. And oh, by the way, it’s recycled.” Minimize the sustainability price premium. Price can deter people from buying sustainable offerings, according to the Conference Board’s research. And in this time of pandemic-induced crisis, with many consumers suffering financial losses, this might be truer than ever. So, achieving cost efficiency is critical to keeping prices low. Companies can do this through innovation and partnerships — including with competitors. For example: Even pre-crisis, Procter & Gamble, Unilever, and Colgate-Palmolive were committed to making their discoveries and technologies for recycling plastics accessible to others in the industry. This helps increase the supply of recycled plastics for all participating companies, while saving other businesses needless development costs. Plus, it advances companies’ sustainability goals and addresses consumer interests. Companies can also launch pricing plans that reward repeat purchases of sustainable products or services. Take Adidas’s circular economy service, Infinite Play, which is available in the U.K. and gives people gift cards or loyalty club points in exchange for their used Adidas items. Educate consumers about sustainability features and build trust. Many consumers find it time-consuming to gather information about a brand’s sustainability features — additionally, they don’t trust claims, or they find them confusing. According to the Conference Board’s survey, this lack of understanding is a key barrier to consumers buying sustainable brands, especially when it comes to awareness of fair labor conditions and wages. So, brands need to clearly communicate with their customers in concrete terms, disclosing information such as the amount of packaging saved or how they’ve enhanced certain working conditions. The COVID-19 crisis has inspired companies to do exactly that: It has put employee-related policies and crisis response in the spotlight, so businesses across the board have been communicating frequently with the public about these issues. To strengthen consumer awareness and trust, companies can also seek independent certification and inclusion in app-based directories that provide information about products’ sustainability features. Give sustainable consumption social currency. Like luxury goods, sustainable products often involve premium quality, craftsmanship, storytelling, and significant intangible value. For example, two different in-store experiments, one with fair trade–labeled coffee and another with a socially conscious–labeled Banana Republic women’s suit — ordinary items, but not the cheapest in their categories — showed that the sustainability labels enhanced demand. Sustainability features also seem to grant emotional benefits, including the satisfaction of consuming more consciously and subtly signaling status. Brands can support, facilitate, and even encourage this status signaling with tools similar to virtuous behavior badges, such as “I voted” stickers, pink ribbons, or fitness trackers. For example, research has shown positive effects on hotel guests’ towel reusage when they can show their “green support” by wearing a pin or hanging a card on their door. All crises offer new opportunities. The current one may be a test for sustainability, but it could also instigate a new level of corporate creativity and innovation along the sustainability value chain.Reusable packaging in the time of COVID-19
![Recyclable, reusable eco friendly bags, package, bottles, cans and storage containers, mesh bag.](https://ci5.googleusercontent.com/proxy/eqggqbOxAck9AJtzVUAfvhnN6LgRMXCEZqNqxuh9h-0cSS0VqOt_F_RDcYVSIT1rhA6-PeGDnS9u_EhIttGbsZtG_pHlCGvdmAmOXbXmZpzh0q7T4Thi_hhMUo0NlvoDwocKLcUFDBQE7-F5pkc=s0-d-e1-ft#https://www.greenbiz.com/sites/default/files/2020-05/reusablepackaging_shutterstock_5PH.jpg)
Take the dentist. Year-round, people young and old go for routine check-ups and surgeries administered by tools and equipment that come in contact with pathogens and people potentially infected with serious diseases. It’s a practice that often draws blood, and yet, the items are used over and over again, on many folks, and everyone’s OK with it. The reason for this is trust. Despite that most of us will never see it in action, we trust the tools are being sterilized properly. If we didn’t have faith in this, we’d choose another provider or stop going to the dentist. Reusable packaging is faced with proving its trustworthiness alongside disposables in a world that is standing six feet apart in the grocery aisle. Trusting others to be clean and safe on your behalf is a liability that can result in someone getting sued, or sick, which is why many consumers are opting for goods in single-use packaging and some eateries frown upon patrons taking leftovers home in their own containers in "normal times." Disposable packages are painted as sterile, while durables are tainted with suspicion. To be clear, unless explicitly labeled "sterile," single-use is no more safe, as both are potentially exposed to different elements in packing, pallet and transport. They are touched by many people, and the independent organizations setting the standards and monitoring respective microbial limits vary. But trust is a risk, and businesses championing reuse that are able to meet people where they are, COVID-19 notwithstanding, stand to benefit. The sort of systems-thinking that considers the consumer and their values now and beyond this time of uncertainty creates value through a sense of community and meaningful connection that’s both scalable and adaptable. At the start of this pandemic, our new Loop platform was at the center of some of this discourse, the returnable, refillable packaging model a subject of wonder. In a world where consumers are anxious and making purchases with safety, ease and comfort top of mind, could a zero waste, circular shopping platform of returnable glass, metal and plastic containers survive? Now, we can report that our sales for April nearly doubled what we did in March, half of which was spent out of an official emergency. Our bestsellers were refillable Clorox wipes (the "disposable" sheets recyclable through TerraCycle) and Häagen-Dazs ice cream in insulated metal tubs.Reusable packaging is faced with proving its trustworthiness alongside disposables in a world that is standing six feet apart in the grocery aisle.
![The Loop service will be available first in the metropolitan areas near New York and Paris.](https://ci6.googleusercontent.com/proxy/DBxKPF7Go7q6Yne3lQ4y1paQNL-oZeTbqhR9t5u2X-13G0ckao2jqZKMggsSB8v5HiwoEi3mqubYzRq8xtZGwEyXdwODP00EiIV1I05avpKOb7bp0suRVjlmP26FPs48ivNvLEYm=s0-d-e1-ft#https://www.greenbiz.com/sites/default/files/images/articles/featured/looptote4.jpg)
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TerraCycle
Veronica Rajadnya
Writing & Content Manager
TerraCycle, Inc.
Office: 609-393-4252 ext. 3702
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www.terracycle.com
Eliminating the Idea of Waste®
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CPGs Retool to Get Into the Loop
TerraCycle
pepsico
coca cola
Mars
Nestle
Unilever
Include USA
UPS
Procter & Gamble
Walgreens
Loop
Clorox
Häagen-Dazs
Kroger
While there’s no scientific evidence to support this claim, there’s a widely shared consensus that most people eat ice cream directly out of the container. While a seemingly unimportant detail in the production of this popular dessert, for Nestlé, it was one of the most critical considerations as it planned out a new, radical design for its Häagen-Dazs ice cream brand.
In January of 2019, Nestlé announced a partnership with TerraCycle, a global recycling organization that was rolling out a first-of-its-kind home delivery service called Loop.
TerraCycle, known for its mission to eliminate waste by creating new products from the collection of hard-to-recycle materials, has been around for two decades. Last year, during the World Economic Forum in Davos, Switzerland, TerraCycle founder Tom Szaky unveiled Loop, a shopping platform that will enable people to consume products in customized, brand-specific, durable packaging that is collected, cleaned, and refilled.
As the world shines a spotlight on sustainability initiatives that factor in recycling single-use packaging, Loop takes the eco-friendly, green model to the next level by introducing reusable containers. And some of the biggest food and beverage and consumer package goods (CPG) companies including Unilever, Procter & Gamble, Clorox, Mars, Coca-Cola, PepsiCo, Nestlé, and more, were onboard for the pilot program that launched last year.
For its part, Nestlé joined Loop as it committed to expanding its global efforts to develop new packaging designs that minimize the impact on the environment, noting that by 2025 the company plans to make 100% of its packaging recyclable or reusable. As part of the Loop pilot program, Häagen-Dazs ice cream was delivered in a reusable, stainless-steel, double-walled ice cream container, which keeps product fresh and cold while maintaining the pint at a comfortable temperature for the person eating the ice cream straight from the container. The design also enables the ice cream to melt quicker at the top, and its rounded edges means the last spoonful doesn’t get stuck in the corners of the container.
“The package design process was a critical part of the entire Loop process,” said Steve Yeh, a project manager at Häagen-Dazs. “It’s not just about making a reusable container, it’s also about creating a high-touch consumer experience.” According to Yeh, the Häagen-Dazs package went through a total of 15 iterations before it finally launched. “Nestlé committed major resources to design and develop the original package.” The team also worked closely with Loop on developing breakthrough cooling technology for the Loop Tote, which the ice cream container is delivered in via UPS.
Terracycle officials admit there is a cost to manufacturing partners committing to Loop—from the investment in new durable packaging to the design of the product to the time spent understanding how to handle new packaging lines and how to scale to meet demand. But the reality today is that sustainability efforts are here to stay. And any new endeavor is going to require an upfront investment.
According to a new business intelligence report from PMMI, the Association for Packaging and Processing Technologies (and Automation World parent company), packaging sustainability has moved beyond a trend and is now a global shift. Released in March 2020, the report, “Packaging Sustainability: A Changing Landscape,” reveals how sustainable packaging initiatives at CPGs are affecting machines, materials, and packaging formats. The report states that the global sustainable packaging market reported that total value of revenue was estimated at $220 billion in 2018 and is predicted to reach $280 billion in 2025, growing at a compound annual growth rate of approximately 6%.
The report is based on information collected from 100 sources and 60 interviews. The majority of the CPGs interviewed are looking to switch to lighter weight, recyclable, and sustainable materials to reduce waste. About 36% of the CPGs interviewed are exploring the circular model of reuse/return/refill.
The circular economy
For decades consumers have been participating in the “throwaway lifestyle,” where single-use products are disposed of resulting in massive amounts of waste. According to the Environmental Protection Agency, the total generation of municipal solid waste (MSW) in 2017 was 267.8 million tons or 4.51 pounds per person per day. Of the MSW generated, more than 94 million tons of MSW were recycled and composted, equivalent to a 35.2% recycling and composting rate. In other words, we don’t have a good track record for recycling. TerraCycle thought there must be another way—which is Loop.
“The genesis of Loop is a tighter, closed-loop system that has manufacturers taking back ownership of their packaging,” said Ben Weir, Loops’ business development manager for North America. “It’s bringing about the reusability of packaging in something that is durable and long-lasting and that can be cleaned and used hundreds of times.”
It’s not a new concept, but rather a throwback to the milkman model in which consumers returned the glass containers. What’s new is the aesthetic benefits that will drive consumer brand perception—and, while not obvious at first—it is a better economic model for the manufacturer.
“The concept of a circular economy is an economic model, not a sustainability framework,” said Tim Debus, president and CEO of the Reusable Packaging Association (RPA). “By decoupling growth from the consumption of finite resources, maintaining product values at their highest, and building market resilience to source material disruptions. It is estimated that the circular economy offers $4.5 trillion of value from new growth and innovation opportunities, and the world today is only 8.6% circular.”
There is an enormous opportunity, but manufacturers may hesitate due to the upfront investment related to packaging design and retooling machinery.
According to Nestlé’s Yeh, the company used its Bakersfield, Calif., facility to ramp up its production of ice cream in reusable and durable containers for the Loop pilot project. “We decided to retrofit an existing line to support the platform versus investing in a new line. It was not an easy changeover and required some reengineering. Some of the changes involved installing more modern equipment including better code daters and more modern metal detection.”
Yeh said they also incorporated improvements to existing processes, which requires additional staff to handle the containers. “Once the platform expands, we would then visit a fully automated system.”
Automating the Loop
The Loop circular platform works like this: Consumers buy a product online through the Loop store or at a retail location—Nestlé will offer Loop containers in more than 200 Häagen-Dazs shops across the U.S. this year, and Kroger and Walgreens have partnered with Loop to offer products in retail stores later this year. The customer pays a small, fully refundable one-time deposit to “borrow” the package. The delivery is then scheduled online when the customer checks out and pays for shipping to have the Loop Tote filled with product delivered, via UPS, to the customer’s doorstep. When the containers are empty, the consumer puts it back into the Loop Tote and schedules a pick-up. The containers are sent to a Loop facility to be cleaned using state-of-the art cleaning technology and are then sent back to the manufacturer to be refilled. If a consumer purchases ice cream through the Loop subscription, for example, Nestlé fills the sanitized steel container in its Bakersfield, Calif., facility and ships it back to TerraCycle to fulfill the e-commerce orders.
Loop is operating the entire supply chain to ease the burden on partners, Weir said, but right now the circular Loop is a largely manual process. “There is tremendous opportunity for technology advancements to be made whether it is IoT (Internet of Things) or [other] levels of traceability in the system, there is definitely opportunity there,” he said.
RPA’s Debus agreed, noting that the ability to put some kind of tracking technology on an individual package could become a vehicle for inventory management (where the product is), predictive analytics (when the container will come back), and monitoring for quality control, traceability, and recall capabilities.
A lot of the tracking technology available today, such as RFID tags, are outfitted on large pallets or containers used in transporting products, but there are new offerings available now that provide real-time visibility of returnable assets without building out an RFID infrastructure.
Roambee, for example, provides an “infrastructure-less sensing platform,” called the Honeycomb IoT Application Programming Interface (API) Platform, that uses Bluetooth, a cellular network, or ultra-low power radios to send data directly to the cloud where it can be analyzed. Of course, it may not make sense to equip every container of Häagen-Dazs with a sensor, and that doesn’t have to happen.
“We don’t do 100% tagging, but we do 100% extrapolation of data,” said Vidya Subramanian, Roambee co-founder and vice president of products, noting that it does not have to be a sensor. The tracking method could be as simple as a QR code. “Location helps derive context. If it’s at a cleaning facility you can extrapolate that location to action, like it is available for filling. We take location and assign context to it.”
The Honeycomb platform does three things: drive compliance of expected action, drive performance in terms of velocity and movement, and keeps the brand secure—making sure that the product has not been compromised in the chain of custody.
Preparing the packaging line
Of course, before CPGs can even think about tracking containers, they must first think about switching over lines to accommodate new kinds of packaging—be it durable goods or light-weight materials.
According to Rich Carpenter, general manager of product development at Emerson Automation Solutions, three things have to come together to enable trouble-free line changeovers. “The manufacturer has to buy in to modular manufacturing and demand it from their suppliers. The control suppliers have to embrace plug-and-play technology so that when the system arrives on site it can easily plug into whatever automation is there be it PLC [programmable logic controller], SCADA [supervisory control and data acquisition], or DCS [distributed control system]. And the OEM has to make equipment in a way that is more reconfigurable and easier to do product changeovers so as needs change the equipment can adapt to it.”
These things are starting to converge, and, as PMMI’s Packaging Sustainability report points out, there is a real opportunity for machine builders to be proactive now to help manufacturers meet their sustainability packaging goals.
Loop is one option for manufacturers trying to make good on sustainability promises. And it seems to be catching on. “We’ve moved from 25 global brands to 150 global brands in a year’s time,” Weir said. “And the idea of an elevated offering is resonating with the consumer.”
Manufacturers, too, are thinking about how Loop can be applied upstream, as well.
“Working with TerraCycle has challenged our way of thinking across the board,” Nestlé’s Yeh said. “We are currently exploring new avenues to reduce our own single-use packaging across our supply chain. For example, we’re working more closely with our suppliers to receive our ice cream ingredients in reusable containers.”
Reusable CPG Packaging Platform Loop Expands Nationwide
pepsico
Nestle
Unilever
Include USA
P&G
UPS
Walgreens
Loop
Nature’s Path
Greenhouse
Clorox
Tropicana
Häagen-Dazs
Kroger
Chameleon Cold Brew
Puretto
Purely Elizabeth
Company Delivers Food And Cleaning Products In Returnable Containers
CAMBRIDGE (CBS) — Home delivery services for groceries have been booming during the coronavirus pandemic. One of those companies has an added environmental benefit.
Loop is selling food and cleaning supplies in reusable metal containers that can be returned and shipped out again.
“Loop is the milkman re-imagined,” said company executive Anthony Rossi. “We are bringing that idea of the refillable milk bottle to thousands of different products.”
Liz Walker of Cambridge was motivated to cut back on the waste she created in her home. “The climate crisis is the most important issue. It’s so existential,” she said.
Reusable Loop containers (WBZ-TV)
Her concern comes as cities and towns have been struggling to keep up with recycling since China stopped accepting our single-stream recycled material. So she began ordering coffee, rice, and personal care items like shampoo from Loop.
When the containers are empty, she sends them back and they are cleaned, refilled and shipped out to another customer.
Many of the items on Loop’s grocery list are generic staples. But the company has also teamed up with some well-known national brands like Haagen Dasz.
“It’s in a special container that keeps it cool,” Walker said.
Price can be a downside for Walker, with a pound of pasta going for $5, but Loop expects prices to fall as the company grows. Walker is also concerned about the environmental impact of the deliveries but Loop is working on that, too.
Liz Walker orders from Loop (WBZ-TV)
“We are going to bring Loop in-store as well, which is why we are partnering with Kroger and Wallgreens,” Rossi said. The first items available in those retail stores are expected to be out on the west coast later this year. There is no timeline for retail stores in Massachusetts.
Walker hopes other companies will get the message that consumers are choosing their brands based on environmental impact.
“I think companies are listening. A lot of people are thinking about this problem now,” she said.