Programme Manager, Plastics Pact, New Plastics Economy, Ellen MacArthur Foundation
The COVID-19 pandemic has exposed the vulnerabilities of the global supply chains at the heart of our economy.
Businesses have faced unprecedented disruption to demand and delivery patterns, including shortages of materials, oversupply and inventory difficulties, and price fluctuations, as well as manufacturing and transportation delays.
The brittleness of prevailing linear business models – which rely on taking finite resources to make short-lived products that are destined to become waste – and the economic, social, and environmental risks associated with maintaining those models are clear.
By embedding circular economy strategies into economic recovery plans, businesses can build supply chains that are resilient in the long term.
We must rethink the way we design products and supply chains
In most supply chains, raw material suppliers, manufacturing locations, and end consumer markets are spread over many countries. Long transport distances, lack of reverse logistics, incentives that favour the use of virgin materials, and products not being designed for reuse or disassembly results in products and materials being discarded as waste.
For plastic packaging replacing just 20% of single-use plastic packaging with reusable alternatives offers an opportunity worth at least USD 10 billion to the industry.
Rethinking supply chains so products and materials are designed and collected for reuse, remanufacturing, and recycling, can make products cheaper and reduce cost of materials for businesses, while keeping these valuable materials out of landfill or the environment and in the economy. This is a circular economy solution with built-in resilience.
Take plastics, for example. Using plastic that already exists, in the locations where it is needed, offers a significant opportunity for the industry, starting at the product and system design stage. For plastic packaging, for example, replacing just 20% of single-use plastic packaging with reusable alternatives offers an opportunity worth at least USD 10 billion to the industry.
Designing for and investing in reuse models can help secure material supply, particularly in cases where the business maintains ownership of the packaging, while also delivering further user and business benefits, such as customised design and brand loyalty. Safety and hygiene concerns of reuse during the pandemic have largely been put to rest by public health professionals – with the evidence in favour of reuse systems provided basic hygiene is employed – and, in some cases, reuse models have enabled businesses to continue operating and even expand operations.
For example, in Santiago, Chile, tricycles containing Unilever cleaning products have been delivered by reusable packaging business, Algramo, during the pandemic. The Algramo team disinfects the refill chamber in the tricycle as well as the containers, both before and after the refill is carried out. Sales from this service increased by 356% between April and June, despite the city of Santiago being in lockdown.
These strategies can enable the creation of a low-carbon economy that is resilient not only in a pandemic, but also in the future. Building back better is crucial in order to usher in the next wave of prosperity.