Reuse is on the Rise, but ‘Much More Needs to be Done’

A new report from Smithers explores the dynamic reusable and refillable packaging market, detailing four reuse/refill strategies as well as new technology innovations that will help the market grow.

Anne Marie Mohan

Sep 30, 2022

Unilever introduced its Dove refill-at-home deodorant package in early 2021.

Reusable and refillable packaging is one of the most dynamic sectors of the packaging market in 2022, with rapid growth fueled by innovative formats and the imperative for Consumer Packaged Goods companies to enact more planet-friendly business models. That’s according to a new report from Smithers, “The Future of Refillable and Reusable Packaging to 2027,” which outlines how retailers and brands can make a highly visible commitment to cutting single-use plastics by fundamentally rethinking their packaging for reuse.

According to Smithers’ data, the market for reusable/refillable packaging will reach $42 billion in 2022, up from $35.1 billion in 2017. As the industry looks to new concepts to realize true circularity in packaging, Smithers forecasts future growth at 5% year-on-year reaching a value of $53.5 billion in 2027. Smithers’ analysis identifies four distinct reusable/refillable business models, a categorization that is also laid out in a 2019 publication from the Ellen MacArthur Foundation, “Reuse – Rethinking Packaging”:

· Refill-at-home: Users refill a container at home, typically with lightweight or concentrate refills delivered by a mobile refill or subscription service.

· Return-from-home: Packaging is recovered for reuse from a consumer’s home by the scheme operator or a logistics company working under contract.

· Refill-in-store: Consumers take reusable containers on their shopping trips to refill via an in-store dispensing point.

· Return-in-store: Users return the reusable packaging at a store or designated drop-off point, often supported by a deposit return scheme.

As the report reveals, there is no single reuse model that works with all products and in every situation. Different consumers have different needs and wants, which depend on a host of factors—where they live, how they shop, and what they buy. Likewise, different product categories work better in-store than at home, and vice versa. “Success depends on tailoring solutions accordingly, removing barriers to entry, and keeping systems as simple as possible,” Smithers advises.

Global refillable and reusable packaging sales in mature markets, percentage share by material, 2021. Source: SmithersIn beverage retailing, reuse/refill is a familiar business model, especially for glass bottles. For this reason, even in 2022, glass packaging for beverages remains the dominant segment, representing over 75% of all reuse/refill packs. Other market segments are still at a nascent phase. Brand owners in food, cosmetics and personal care, and home care, as well as other beverage types are investing heavily in reuse/refill concepts featuring more durable packaging designed for repeat use and prolonged handling. Strengthened by the experience of COVID-19 and the rise in e-commerce subscription sales, Smithers forecasts each of these new segments will see growth in excess of 30% year-on-year across the next five years.

Going forward, there are several technologies that will improve the effectiveness of reuse packaging models, the report advises. One is the integration of smart packaging technologies, such as scheme-specific smartphone apps, that link the consumer to advice on refill locations and incentivize reuse, for example. Integrating this with track-and-trace systems will give greater insight into packaging and waste flows, facilitating the more accurate mapping and effective collection of higher-value reusable packaging.

Listen to this unPACKED podcast, “10 Billion Reasons to Embrace Reusable Packaging.”

Another is the greater diversification of refill locations for refill-in-store platforms, of which Smithers says there are not enough currently, to make them a more appealing option for customers. “Immediate priorities are to develop mobile refill machinery and multi-product dispensers that can provide a range of SKUs comparable to those seen on supermarket shelves,” says the report.

Lastly, superior bottle cleaning technology will increase the number of bottles recoverable for existing beverage refill systems, including the deployment of more automated, decentralized micro-cleaning facilities and more durable PET bottle constructions.

Concludes Smithers, while a large number of small-scale developments for reuse/refill have emerged since 2017, “much more needs to be done.” It adds, “More trials and scaling up of pilot projects on everyday household items must become available to consumers if refill and reuse is to become more mainstream.”