The Co-op is set to implement the UK’s first plastic bottle deposit scheme, becoming an example for retailers to look back upon when implementing their own schemes, according to GlobalData.
As part of a strategy to tackle plastic waste, the UK government’s recent proposal to implement a deposit return scheme on drinks bottles has set the wheels in motion with UK supermarkets. The Co-op is looking to trial its own scheme this summer by implementing bottle depositing vending machines at several popular UK festivals.
Following other similar schemes around Europe, an extra ‘deposit’ charge will be applied to plastic bottles purchased at Co-op stores, which will then be refunded in the form of a Co-op voucher when recycled as opposed to cash. The bottles that are collected will subsequently be recycled and used for Co-op’s own brand water.
Ryan Choi, Consumer Analyst at GlobalData, says: “Both the government’s deposit scheme (which is likely to give cash back) and Co-op’s initiative imply a price increase for plastic drinks bottles to incorporate the deposit charge and from a consumer perspective a higher price point is never a good thing. However, the idea is that the refund will allow people to re-coup the additional cost and help encourage recycling at the same time.”
Uptake of the government scheme will likely depend on how accessible the bottle depositing machine is, and whether vouchers are the best form. If depositing machines are not readily available and accessible, consumers will end up throwing bottles in the bin for convenience. Another important aspect to consider is the form of the refund.
Choi explains: “Cash will be preferable as it gives consumers freedom of choice and allows them to spend it however they like, whereas retail vouchers will likely deter consumers due to the lack of freedom. Furthermore, the cash back value will also play a crucial role, too little and consumers will be less inclined to recycle but too much and it might be too costly to implement.
“The government plans will likely follow existing schemes around the world – for example German consumers get 22p cash back on drinks bottles and in Sweden this is lower at 8p. Co-op’s initiative will test the waters and whether such a scheme will resonate well with consumers. But nonetheless, the success of the government plans will likely rest upon the cash value of the refund which will determine whether consumers believe it’s worth recycling their plastic bottles.”