50% of growth in consumer packaged goods came from sustainability-marketed products 2013–2018

Little Freddie is a producer of yoghurt food for babies. They recently launched a scheme to closed-loop recycle their aluminium-plastic laminate packaging. Since launching the scheme, the company has seen a 10% increase in sales alongside a 30% increase in recycling rates of their packaging. Great work Little Freddie!

This is an encouraging example of consumers rewarding those companies that take action on issues of sustainability, and begs the question, “what sales benefit would a brand see if they could achieve close to 100% recycled content in their products?” We have to expect that sales would increase dramatically in line with consumer approval of their environmental credentials.

The Harvard Business Review conducted a survey using data from 36 categories and more than 71,000 stock keeping units, which accounted for 40% of consumer packaged goods dollar sales in the US over the five-year period between 2013 and 2018.

They found that products that had a sustainability claim on-pack accounted for 16.6% of the market in 2018, up from 14.3% in 2013, and delivered nearly $114 billion in sales, up 29% from 2013.

Most important, products marketed as sustainable grew 5.6 times faster than those that were not. In more than 90% of the CPG categories, sustainability-marketed products grew faster than their conventional counterparts.

In simple terms, if a product is labelled “made with 100% recycled materials”, it is likely to sell substantially more units.

Currently however, it is not economically feasible or even possible for most brands to achieve levels approaching 100% recycled materials in their products and packaging. This is because manufacturers can buy virgin materials at a far lower price than they can recycled materials.

Why? Because the virgin materials do not include the cost of the environmental damage they cause and the current domestic recycling system does not deliver cost efficiency, nor performance equivalent recycling materials.

The increase in sales that would come hand in hand with using higher rates of recycled materials would not outweigh the increased manufacture costs associated with using the currently more expensive and inferior materials, even if some consumers were willing to pay a higher price for the product.

Enter the ReCircle appliance, which will take regular domestic used materials and produce pure uncontaminated products in your kitchen (Reproduct®s) that are ready for remanufacture. Reproduct®s are valuable and can compete aggressively on cost with virgin materials. Most importantly Reproduct®s dramatically outcompete virgin products on any environmental footprint comparison.

The result will be a reliable stream of Reproduct®s that are a viable economic choice for brands to embrace in their manufacture chains, and benefit in turn from customer approval and increased sales.

With brands prospering commercially from an increased level of sales, ReCircle will also benefit by charging a premium for these closed-loop recycled products that will be in such high demand.

It’s a win-win-win (consumers, manufacturers and the environment) solution that we hope you will want to keep in touch with as we progress. We are currently developing the prototype.

Check out our website materials here, or sign up for updates via our mailing list below.