Retailers to Roll Out Returnable Packaging

Consumers pay a deposit and return the package to the store.

August 20, 2020

TRENTON, N.J.—Tom Szaky, CEO and founder of TerraCycle, wants to see shoppers take their trash with them to the grocery store, and he’s about to find out if that idea will work. According to the Wall Street Journal, TerraCycle’s refillable package platform, dubbed Loop, will soon roll out to retailers, including Kroger in the U.S. and Tesco in the U.K.

Loop allows shoppers to purchase products like ice cream and deodorant in reusable containers. They pay a refundable deposit when making a purchase ($1 to $10, depending on the container’s size and material), and they return the empty containers to the store, which collects them for cleaning and reuse. The consumers get their deposits back and buy another tub of ice cream or stick of deodorant, starting the cycle again. 

Aeon, Japan’s largest supermarket group, plans to introduce Loop containers to 16 stores in the greater Tokyo area in March. “We want people to come in and fall in love with these really cute, beautiful packages, understand the message and get excited about it,” said Satoshi Morikiyo, general manager of convenience goods, Aeon. “This is a cool experience that offers something of a discovery—something new and fun.”

As NACS Daily has reported, Loop was created in 2019 and tested in the Northeastern U.S. and Paris with 10,000 customers. Loop’s goal is to provide brands from consumer-packaged goods giants like Procter & Gamble, which is a Loop investor, with durable packaging designed to be recycled.

Products like Häagen-Dazs ice cream and Seventh Generation detergent are sold in Loop’s stainless-steel tins. They can be returned, cleaned and sold again in a “milkman” style system. As retailers prepare to bring Loop into stores, executives are trying to craft a shopping experience around the products rather than simply stacking them on shelves.

Since last year, Walgreens has been working with Loop on an e-commerce pilot in 15 states and Washington, D.C., and is still monitoring results, according to Lauren Brindley, group vice president for beauty and personal care, Walgreens. No date has been set for an in-store launch.

“We have to really consider how we make sure customers understand from the beginning what they’re purchasing, and how they basically get the deposit back for the product,” Brindley said.

Kroger, another of Loop’s founding partners, is on track to test a Loop retail experience in a handful of stores in the first quarter of 2021, according to Lisa Zwack, head of sustainability, Kroger. The chain is designing a retail experience that is easy to find in store and will encourage customers to reach out and touch the products, she said.

To collect used containers, Loop has developed two types of receptacles: the “smart” bin, which can scan empty containers and refund deposits right away, and the analog “passive” bin, which sends refunds to customers’ bank accounts once their deposit has made it to a central Loop cleaning center. The long-term plan calls for customers to be able to buy Loop products at one store and return the empty packages at another.

“Our goal is to eventually allow these brands and retailers to play in the platform however they want,” Szaky said. “But until it’s really working perfectly, we want to be involved in sharing knowledge between retailers.”

Loop is included in the June issue of NACS Magazine’s look at “Sustainable—and Safe” packaging. Read it now at NACSMagazine.com.

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