Six things to consider when building reusable packaging models

Impact accelerator TRANSFORM is a joint initiative between Unilever, the UK's Foreign, Commonwealth & Development Office (FCDO) and EY. It supports innovative small and medium-sized enterprises (SMEs) and entrepreneurs providing market-based solutions to key environmental challenges, including plastic pollution.

In line with Unilever's ambition to end plastic pollution through reduction, circulation and collaboration, TRANSFORM funds and supports a range of SMEs, such as those looking to improve the lives of informal waste workers and those aiming to scale alternative business models.

Here, we share insights from four enterprises - Alner, Bopinc, Novek and Refillable - that are building reuse-refill business models in Africa and Asia.

1. Refill solutions take time to establish

   Enterprises and brand owners must develop partnerships with retailers and, at the same time, work together to change consumer shopping patterns. Volume uptake is often slow at first and refill models won't work for all products. So it's important to prioritise items which are most suitable and that can be launched and scaled quickly, and to support consumers through behaviour change.

   Refill is a logical solution for brands and consumers to reduce waste and achieve long-term cost savings. For retailers, it offers a unique value proposition. We've seen successful examples in Indonesia, proving its viability across the supply chain.

   Bintang Ekananda, Co-Founder & CEO, Alner, Indonesia

2. Consumers often prefer to bring their own reusable packaging

   When it comes to home care products, consumers often prefer packaging to be functional and are less concerned about its appearance. For personal care products, however, the packaging is more important and needs to look good. Labels can be used to add brand and product information to these packs.

3. Various factors determine what kind of solution is required

   Understanding the technology, consumer and regulatory requirements in a market will determine if a high- or low-tech solution is right.

   High-tech machines are better to ensure product quality, but they come at a cost. This is a challenge when operating with low margins and in low-income markets. They are also more complicated to deploy and can have unexpected drawbacks. For instance, in countries that have regular power cuts, they can stop working and need additional support, such as battery back-up, which can add further cost.

   Aside from the obvious environmental advantages, the biggest benefit of refill models in low-income markets is providing consumers with cost savings, as they are paying just for the product and not the packaging.

   Zahid Mitha, CEO, Novek, Africa

   Low-tech solutions are much easier to set up and scale across multiple locations, meaning they probably have more potential for creating impact at scale. They also have lower operating costs which is beneficial in low-income markets. However, such models are not always possible because of local regulations, so government engagement is key. Both quality and quantity of product are more vulnerable to tampering.

4. It's critical to ensure product quality is trusted

   Enterprises and brand owners must put in place strategies to build trust, as refill models can be perceived as allowing for product tampering, which is a concern for both brands and consumers. A low-tech solution to this problem is sampling to ensure product quality is correct and consistent. A more sophisticated solution is to provide product traceability through the refill machine reporting each dose back to the manufacturer.

5. Store owners have a key role

   Shopkeepers can be reluctant to adopt new technology, especially when shelf space is at a premium. But once convinced, they can influence the model's success by selling the idea to their customers. Enterprises can educate store owners on the environmental and cost benefits of refill products, and provide training to store owners to help them boost sales.

6. Leveraging local champions can accelerate uptake

   Tapping into local community champions - such as store owners, local communities and NGO leaders - is a powerful way of encouraging consumers to use refill stores. If a well-respected individual is engaged, they then help bring others along. It's also important to build trust with people, for instance through educational workshops that explain the concept of refill, and the benefits to them and the environment.

Read TRANSFORM's full insights paper.

To read more about our updated commitments on climate, nature, plastics and livelihoods, visit our Sustainability Hub.

*This article was updated on 08/07/2024 with up-to-date images from the enterprises.