Ever since we started Charopy the focus was on building technology to support improved recycling outcomes, but recently we launched a new initiative that goes one step further. This post is titled The Future of Reuse, partly because I am absolutely convinced that the Future is Reuse. In the past six months or so I have been amazed at how fast the conversation has shifted to reuse and how many people have been contacting Charopy looking for solutions. Whilst recycling is great, and we have come so far as a nation in recent years, reuse at scale really is the holy grail of circularity.
But herein lies the problem. If something is niche, then trust based systems that rely on hoping people will return their take away food and drink packaging for wash and reuse seem to work reasonably well in most cases; solving this at scale is a completely different issue. Given the rapidly growing interest in this topic, and the genuine desire for change, it is becoming pretty clear that government mandates will eventually play a role in how a reuse model becomes ubiquitous amongst coffee shops, cafes, restaurants and food delivery services. Why stop there - how about detergent bottles, shampoo bottles, liquid soap, vitamin bottles and supplement containers. All of these are perfect candidates for reuse at scale via a centralised collection and washing system, but technology will be critical in making these programs successful.
Recently in Sydney at the Australian Waste & Recycling Expo we launched a new offering in conjunction with Huskee (recently acquired by Biopak) that aims to solve many of the problems we see with other reuse systems that are unable to scale. Coffee cups are the first product, but they will be closely followed by take away food containers. Both the service offering and the technology are extremely flexible to cater to different models and different locations, but for cafes initially everything will be collected to be cleaned in centralised wash hubs and redistributed to individual cafes for reuse.
Probably the biggest benefit of the Charopy piece in all of this is how we have solved for shrinkage. We have heard of various existing reuse systems suffering loss rates of 30%, meaning that only 7 out of every 10 cups or containers sold are actually returned - when 30% of your product goes missing every time, it is starting to look not too dissimilar to a single use throwaway model. This is the point I referred to above about reuse systems based on trust being impossible to scale. We have various ways we can massively reduce shrinkage to a negligible number, and the model we implement will depend upon the specifics of your business.
In the cafe example Charopy technology links the cups to the purchaser when they leave the cafe and if the cup is not returned within seven days to one of the many dedicated Charopy bins then the consumer's card is charged a few dollars to cover the cost of the cup. This type of model works really well where consumers are repeat users of a cafe, precinct or home delivery service. Immediately after they return their item to one of the numerous Charopy bins nearby, the consumer receives a push message to their phone informing them that their return has been recorded. At the same time the bin updates a remote database so our partners know how full the bin is and exactly what items are contained within it. Naturally the bin only opens for the correct items and rejects anything that is ineligible. There are multiple layers of security to ensure the integrity of this system at all touch points.
A minor variation on this app based model would be able to solve the massive problem of all the landfill that results from home delivery services by moving them to a reuse system. Depending upon how the scheme was implemented, a no deposit system would work because the delivery app always knows who is getting the food packaging and that app already has the consumer's card on file for charging purposes. This would mean a simple integration between the food delivery app and the Charopy system. In this model the consumer could return the containers to Charopy enabled collection points around the city, but many people would prefer to give them to the driver of their next delivery as a tip. In a deposit model just handing them to the driver would suffice, but in a no deposit model the driver would scan each container from a previous delivery on their phone before leaving the home. Given that this would mean extra income for drivers, this small extra task is expected to be embraced. The beauty of this model is that it solves a big problem with food delivery packaging causing landfill, it is seamless for the consumer, it increases delivery driver incomes, and it encourages people to buy more often on the food delivery app if they don't want to return the containers themselves.
Where we would be most likely to modify this app based model is in a stadium, airport or possibly at a music festival where people are less likely to want to download an app in order to purchase a drink. That said, there is a strong case for large venues wanting more of their patrons downloading their own branded app to white label the technology and use it as a way for their their patrons to get increased utility from an existing app - whilst also allowing anonymous purchase and return for other patrons at that venue.
In cases where a venue wants to implement anonymous reuse there is a lot we can learn from the container deposit scheme. By building a small deposit into the purchase price of a product then return is incentivised by the optional refunding of that deposit - this really drives higher return rates as we can set up a system where the deposit goes to charity if the purchaser doesn't care about it; or other people can claim the item and get the deposit into their account if they return cups and food containers that are left lying around. This has the added benefit of creating less work for cleaners at a venue, whilst ensuring a very high return rate of reusables.
There is another model we support that can operate as stand alone, or it can be combined with any of the methods outlined above - some call it the Lottery Model. Whilst our bins have already been able to do this with regular bar codes, that functionality is quite basic compared to what is possible with serialised QR codes in a reuse system. Think of it as using gamification to incentivize returns. Ask yourself, would you be more motivated to perform a simple action for 50 cents or perform that same simple task for a one in a thousand chance to win $500? I would hazard a guess that the vast majority of people would be more motivated by the latter. The fact that so many lottery tickets are sold despite the expected value of the ticket frequently being less than 20% of the face value of that prize draw entry tends to support this. I call it "the psychology of return" and if you understand it you can then use this principle to drive even higher return rates within your reuse system.
Whichever model is best for your venue, one important thing that we have designed into our technology is that the barista or barman or whomever is serving and taking payment should not have extra tasks added to their workflow; the speed of the transaction at the point of sale should not be impacted in any way. Likewise, when returning your reusable item to a Charopy bin the process needs to be super fast, queues should not be forming at return points, and the technology should be resilient so that it still functions smoothly even if they bin loses connectivity to the internet via a wifi or cellular network being down. The return points should be cheap enough to be ubiquitous and should run on battery or solar power when mains power is not available. A good solution should also be globally applicable using standard GS1 reuse formats for QR codes that contain strong encryption to ensure compliance and safeguard integrity. These were all technical challenges that the team at Charopy managed to solve during the design and development phase of our reuse technology.
The scope for reuse to revolutionise how we think about circularity goes well beyond the food service industry. Think about some of the other containers we use in our everyday lives that could benefit from a more sustainable model. What about a brand or multiple brands of shampoos, laundry detergents, soap dispensers, vitamin and supplement containers, dishwashing detergents and maybe even the trays that hold pre packaged fresh produce? Why can't they be returned to the place of purchase to be collected, washed, returned to suppliers, refilled and then put back on supermarket shelves? Up until now the answer may have been that the technology was not ready to support such a model, but that is no longer the case. Charopy technology could even link the purchase and return of these products to a retailer loyalty scheme, giving retailers an even deeper insight into their customers whilst also making a huge positive impact on the steps to a truly circular economy.
I'm not sure when legislation and government mandates will eventually force compliance in this space, but why wait for that when the solution to support a scalable reuse system is already here. It will be interesting to watch which brands take the lead, and who scrambles to catch up later.
Update: Additional Reading: The Path to Universal Adoption of Reuse
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