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Minimising waste and maximising sales

An increasing number of retailers are introducing transparent manufacturing and sustainability initiatives into their businesses, but consumers are now asking harder questions about how much waste the industry produces in total. Courtney Devereux considers what waste-management changes are being made, and whether they’re enough to combat climate change.

By Courtney Devereux | April 10, 2018 | News

Around 100 thousand tonnes of textile waste is thrown into New Zealand’s rubbish dumps yearly, according to figures from Ministry for the Environment. Plastic waste is even more prevalent at 252,000 tonnes per year. And these are only the most retail-relevant waste categories. New Zealand is currently the 10th-worst nation for creating urban waste per capita, globally.

This monumental pile of rubbish comes from both producers and consumers. While unsustainable businesses are now facing pushback from consumers if they do not comply with a new demand for sustainable, transparent manufacturing, those same shoppers are also increasingly asking for support from retailers in disposing of their goods responsibly at the end of the product’s life.  

According to the New Zealand Geographic, the volume of waste New Zealanders send landfills has skyrocketed by 73 percent over the past 25 years. At the same time, household consumption rates jumped by nearly 57 percent in the 22 years between 1992 and 2014, with only a small proportion of this increase attributable to population growth.

New Zealand Geographic’s latest-available figures from 2010 show that New Zealanders threw away just over 2.5 million tonnes of waste into landfill. This national rubbish pile would, if stacked into an 8500-square metre space, tower just over 30 stories.

 Of that tower, 2.5 percent is attributable to textile waste. The recent trend towards fast fashion means clothing is being discarded much faster than it used to – currently, landfills receive a volume of garments equivalent to every person in New Zealand chucking about 145 medium-sized men’s T-shirts a year.

About 8 percent of New Zealand's waste stream by weight is plastic. Because plastics are lighter than many materials, by volume it is estimated they may use up to 20 percent of landfill space. Approximately 252,000 tonnes of plastic waste is sent to New Zealand landfills each year.

With the science on climate change now undisputed and its impacts now a part of daily life, consumer awareness of waste management has become mainstream. With that awareness comes both brickbats and bouquets – some retailers are being pulled up by members of the public for activities such as dumping unsold stock, while others are praised for initiatives like phasing out plastic bags.

Retailers with an effective waste-minimisation and management program are seen as responsible, caring corporate citizens, sensitive to environmental issues – and they can attract customers who favour a ‘green’ image.

According to the 2013 US study, The Business Value of Changing Consumer Behaviours, in one survey of 54 of the world’s leading brands, almost all of them reported that consumers are showing increasing interest in sustainable lifestyles.

The study showed that 40 percent of companies surveyed are encouraging more sustainable practises. Companies such as Ford, Puma, Nike, Levi’s, Timberland, Coca-Cola, and BMW are leading the way with sustainable models and limiting the by-products of their manufacturing.

Those focusing their attention on improving their operations’ eco-friendliness are also realising that beyond the environmental advantages, there are tangible benefits to their bottom line.

Some companies may still be swayed by the barriers that come with the change towards a sustainable business model. The top four barriers as stated by the study are short-term pressure, lack of hard data for benefits, difficulty quantifying intangible outcomes of action and lack of knowledge from the consumer.

For the most part, consumers control what happens to a product. Now, as some companies are realising, placing the burden of recycling entirely on the consumer is not an effective strategy —especially when tossing something away will always be the easiest and most convenient option. In the real world, convenience often trumps good intentions.
 

The circular economy

The holy grail for conscious consumers and those who serve them is the ‘circular economy’. In this model, value is generated through the sale and re-sale of existing resources rather than extracting, devaluing and disposing of new resources. However, maintaining a circular economy means recapturing those resources once consumers are finished with them, and that requires getting shoppers engaged in the process.

Swedish fast fashion chain H&M is publicly working towards becoming 100 percent circular and renewable. While its ‘fast’ strategy of offering a rapidly-changing range of runway-inspired garments at low prices encourages consumers to replace their garments frequently, a spokesperson for H&M New Zealand says the company now intends to limit how much of its clothing and by-products go to landfill.

“We are consistently increasing our use of materials that decrease the dependence on virgin resources, require fewer chemicals, energy, and water and minimise the number of materials that end up as waste.”

H&M is one of the largest chains to have a full circular approach, meaning no stock is sent to landfill from the company itself.

“Most of our product is sold through our stores, but anything left goes through our garment collecting program where it can be re-used, re-purposed into new textiles like car seat stuffing or cleaning cloths, or recycled.”

Since launching the program, H&M has collected 50,000 tonnes worth of garments globally. It plans to increase the collected volume to 25,000 tonnes annually.

Although the chain is offering programmes and limiting what by-products are waste, much of what is sent to landfill depends on the consumer's actions. By educating and offering incentives to bringing in old or damaged garments for the garment collecting programme, H&M is making itself responsible for every part of a garment’s life.

“We educate our customers about our circular vision by encouraging them to reuse their shopping bags. We also offer canvas totes as an alternative which are available in a range of sizes and colours all made from sustainably-sourced cotton.”

However, discarded clothing which isn’t taken care of by the supplier typically ends up in landfills or is dumped at charity shops. These categories aren’t mutually-exclusive, either – in the last financial year, the Red Cross spent approximately $50,000 in rubbish tip costs to dispose of donated goods which were unable to be sold. That means, yes, sending them to landfill.

Changing behaviour

Creating initiatives for consumers to limit landfill waste is one way to get them involved. Businesses such as New World, which offers a discount with each reusable bag brought in, is leading the way.

Almost all plans that involve reaching zero waste rely on some sort of social imperative. Greenpeace New Zealand senior campaign and political advisor Steve Abel says this kind of initiative is a good way to get consumers contributing to a good cause, but says educating consumers on why incentives are being offered is just as important as their effects.

“I think it’s nice that some of the retailers are offering discounts, it’s a simple thing that encourages people to act,” he says. “I actually think most people, when presented with the information about how bad plastics are, don’t want to be part of it and are happy to be encouraged to use alternatives.”

Once consumers understand why they’re being encouraged to change their behaviour, they’re more likely to comply, Abel notes.

 “The more people know, the more they’ll realise why these things have to be acted upon. I think there has been a lot of coverage about the pollution in our oceans and I think people do understand the reasons, but I think a constant need for education can never go amiss. We don’t need plastic bags, so why do we keep using them?”

Industry-led change is important, Abel says, but he believes only government intervention and widespread consumer behavioural change can address the problem of waste management in New Zealand.

“I think in terms of a social good, we always argue that those in the retail sector should be coming at the problem, from a position of social responsibility. All of us need to be socially responsible, particularly those big companies who have influence. And that’ll help encourage the government for legislative intervention.”

According to Abel, retailers will always have a responsibility to lead customers, but consumers are increasingly leading the change: “We think that all of us need to be socially responsible, particularly those big companies who have influence.”

Steve Abel 

Providing alternatives

Clancy Simmonds, marketing manager for Ecobags, agrees that the convenience of using plastic bags must be phased out by changing consumer behaviour.

“You can never compete with plastics, it is almost five times cheaper to purchase them. So what needs to happen is a behavioural change from consumers.”

Ecobags are an environmentally friendly alternative to plastic bags and can be found in stores such as New World. The company has also designed biodegradable checkout bags that are made from natural corn starch.

“These bags are 100 percent compostable and are specifically designed to be sustainable from start to finish. Ideally everyone would carry reusable bags, however, not everyone does and shops want to offer their customers alternatives to plastic,” says Simmonds.

Ecobags, as well as promoting for a change in consumer behaviour, say that government intervention for a change around single-use plastic needs more work.

“It is a challenging time for the industry because there isn’t outside support set up. Sure, there may be compostable bags and coffee cups, but if they’re just going to landfill then what is the point? We need more compost facilities set up in order to fit the growth in demand.”

“Support is needed because the industry can’t grow without it,” says Simmonds. “Businesses need to start taking responsibility.”


 

Built for sustainability

Some retailers have been listening to consumer demand for more ethical practises from the start, and bet their businesses on the likelihood of this demand’s growth. Clothing retailer Kowtow has featured on the Deloitte Fast 50 index in 2014, 2015 and 2016, boasting growth of 297.7 percent at the latter.

Founded on being completely ethical, sustainable and transparent, it scored an A+ for all categories in the 2017 Ethical Fashion Report.

Owner and founder Gosia Piatek says her company’s transparency allows for closer relations with consumers and the people they work with to create all Kowtow products.

“We have a workroom where people can come in and see how the garments are made. We donate to the Red Cross, we also ask when people come into one of our workroom sales that they bring their old garments that we can donate on their behalf.”

As a more conscious consumer becomes the norm, Piatek says there is a need for retailers to evolve as customers and their expectations do.

“What I’ve learned even in the last year or two is that you can’t stay complacent in thinking that 10 years ago you started an ethical cotton brand and that’s the only future. The problem is if a business doesn’t have that sustainability or ethics at the forefront of their ethos, they’re not going to prioritise that because it requires a lot of conversational times.”

Piatek says re-orienting a business model around sustainability can be tricky, but it’s no longer an option to stay complacent and hope other businesses pick up the slack.

“You have to lead by example. What is the point in not? I just don’t understand why you would be doing something knowing that it is harming something else. The world is changing, the climate is changing and resources are becoming tighter along with population growth, and as a business, you have to move with that.”

Taking a stand

During the latter half of 2017, New Zealand grocery retailers began to move. New World launched its ‘BagVote’ campaign in September last year, allowing consumers to vote on whether or how much they should be charged for plastic bag use. The campaign brought New World a wave of public approval, but within weeks, Countdown one-upped New World by announcing it was to wholly eliminate single-use plastic carrier bags by the end of 2018.

New World matched Countdown’s commitment, and was later joined by Mitre 10, which is also phasing out single-use plastic bags and boot liners this year. Further Progressive Enterprises brands SuperValue and Fresh Choice have also indicated an interest in phasing out plastic bags, but are yet to finalise their transition deadline.

Countdown GM corporate affairs, Kiri Hannifin, says the chain has further committed to being zero waste by 2020. This is an important step for the future of the grocery store, she says.

“Reducing waste isn’t just about diverting food from landfill, it’s also about getting our forecasting right and innovating to help reduce food waste across the board.”

Hannifin says Countdown’s ‘Odd Bunch’ scheme, which takes imperfect produce and makes it available for cheaper prices, has saved around 500 tonnes of produce from the landfill.

“Countdown has moved towards recyclable meat trays, which are also made using 50-95 percent recycled PET (polyethylene terephthalate). This will reduce 500 tonnes of the old black foam trays in landfill each year,” says Hannifin.

Countdown was also a founding member of the Soft Plastics scheme. This multi-retailer programme enables customers to drop off a range of soft plastics at their local supermarket for recycling.

The soft plastics recycling scheme includes plastic bags, but they are still mostly sent to landfill. If a bag is thrown away today, it can be expected to biodegrade by 2025 if exposed to direct sunlight, but in the darkness, such as at the bottom of a landfill, it can take up to another 100 years to fully disappear.

Beyond bags

Many businesses are working hard to reduce their environmental impact beyond just plastic bags. Retailers create waste in a number of back-of-house ways, from food waste to pallets wrapped in plastic.

Mashbone, a dog treat company, was born from Garage Project Brewery being smarter about its by-products that came from production. It turned by-products that contained high protein and fibre into sustainable dog treats.

Project manager and leader of the pack, Kalen Acquisto, says as a sustainably focused business Mashbone was determined to use waste products more wisely.

“I would say that smart use is something we care a lot about. We have our sustainability programme here at the brewery and we’re always looking for ways to use our by-products but also cut down on resources and be more efficient. I think success for us is others doing similar things and kind of catching on what needs to happen.”

Yet the issue surrounding the sustainable treats plastic packaging remains. Fortunately, Acquisto presents the forthcoming solution of biodegradable plastics.

“We are in the process of sorting biodegradable packing for the treats as well. Because all our products are made from locally sourced ingredients already, it’s the one thing we’re working on improving and should be ready in 2018.”

Acquisto encourages businesses to actively work towards reducing waste, no matter if that is fuelled by consumer demand or following the steps of a larger business.

“I think it is too easy to be caught up in the day-to-day, and the little baby-steps. It’s so important to reconnect with that bigger image by connecting with other sustainable practices and to know that every step makes a difference along the way.”

“It’s a two-part thing. A lot of what we do is because we care, and I think it’s exciting to see that sustainability matter more and more to consumers everywhere. I think people aren’t just doing it to fit in, which is also fine, but you can tell people are truly striving to be more educated.”

The bigger picture

Ecoware founder James Calver says businesses must lead by example and listen to consumer demand to truly target the problem.

“I think what’s happening is that consumers are becoming more aware themselves. However, it is quite a complicated evolution. Things like ‘biodegradable’ and ‘compostable’, unless explained to the consumer, are just words that sound nice.”

Ecoware has been supplying companies with biodegradable alternatives to packaging for six years, and since its initial stages, has known that its work is an important part of a big change already seen within New Zealand.

“We take responsibility as much as we can from cradle to grave. I think we can put our hand up and say we’ve had a very heavy influence in changing the industry and changing the country.”

Calver says that the growth in sustainability efforts can also be seen by his company’s 607 percent top-line growth.

“Although this is also a reflection of hard work, it is a reflection of the country moving forward and trying its best to adopt more sustainable practises. It’s not that hard to do, it’s just about doing it, but we’re here to hold people hands through the process as well.”

Calver emphasises the importance of educating consumers because from education comes awareness of what happens to products at the end of their lives. 

“It’s complicated, and people who aren’t educated are the ones blurring the lines. It’s complicated not from the products perspective but from the industry and the infrastructure, and the end of the line which includes the council and its different standards per region.”

Each regional council has different standards of waste disposal, making it confusing for retailers to comply with different expectations per area. The newest updates to the Waste Minimisation Act of 2008 are being implemented in the hope of significantly reducing waste going to landfill by 2020 through synchronising laws across the country.

Yet according to the New Zealand Waste Strategy, the number of landfills in New Zealand is reducing. In 1995 there were 327 and 115 in 2002. Recent reports estimate about 54 landfills exist, with much stricter regulations surrounding them.

However, consumer demand for greater transparency and sustainability is likely to open doors in this area as time goes on. Conscious consumers are increasingly mainstream, Calver says.

 “What you’re seeing now, just through consumer influence, is big corporates having to include sustainability in their bottom line,” says Calver. “It is becoming the norm.”

“Consumer voice for change is only just getting started. I think New Zealanders are waking up to what we have to do because we are falling behind in sustainability in a global level. If we don’t change things now it’s going to be too late.”

Calver expects retailers’ focus on limiting waste to increase their ‘green’ image, as this is more favourable to consumers, but also reminds retailers that changes must be consistently carried out, not just promised.

 “As retailers fully adapt and promote it then they’ll be ahead of the competition because that what consumers are looking for. One thing we try to convey to people is that sustainability is a journey, not a destination. It is an ever-evolving process, and the sooner you jump in the sooner you’ll get ahead.”
James Calver (Right) 
 

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