Loblaw partners on test of reusable packaging in Ontario

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For years, the Decadent chocolate chip cookie has been delivered to customers in a plastic tray inside a plastic bag – largely intact, but for a few crumbs. But now, how the cookie crumbles – and if it crumbles – is a preoccupation for Loblaw Cos. Ltd.

The Canadian grocery giant is reviewing prototypes to redesign the packaging for its best-selling biscuit. That’s because Loblaw wants to make it possible for customers to return an empty cookie container, rather than throwing it out. But designing one sturdy enough to be sanitized, refilled and reused while making sure cookies don’t fall apart in a hard-sided box is a challenge.

It’s just one part of Loblaw’s partnership with Loop, a packaging-reuse program owned by Trenton, N.J.-based recycling company TerraCycle. On Monday, Loop will launch a pilot project in Ontario to test a bottle-deposit-style system for returning and reusing packaging of everyday items – including ketchup, pasta sauce and lemonade. Packaged-goods giants including Kraft-Heinz Co. , General Mills Inc. and Unilever PLC have redesigned product packaging for Loop that can hold up to being sanitized and reused.

For now, the products will be available for home delivery through Loop’s e-commerce site, and customers will return the packages to Loop via FedEx. (The service will ship to all major cities in Ontario, though some regions are excluded.) While Loblaw will not carry Loop-compatible products in stores yet, it will be marketing the service to customers through its digital channels, and selling some President’s Choice products through Loop. The test will determine whether Loop expands elsewhere in Canada.

“We will see, does the consumer see value in the offering? Are they willing to participate, change their behaviour?” said Ian Gordon, senior vice-president of plastics at Loblaw.

Customers will also have to be willing to shoulder a higher cost than is typical for e-commerce delivery, however. Loop charges a $25 flat fee for each delivery, including return shipping on empties. Shoppers also pay a deposit on each item – from 10 or 20 cents, to as much as $5 to $10 – refundable upon return.

“Anyone who’s going to support it is voting for a platform like this to exist in Canada,” said Tom Szaky, chief executive officer of TerraCycle. Loop’s ultimate goal is not to continue to operate a retail e-commerce platform, he added: The system becomes more convenient (and cheaper for customers) when products can be sold and returned in stores.

Retail partners in other markets where Loop’s system is being tested are already making that change, including Carrefour in Paris, Tesco in Britain and Walgreens and Kroger in parts of the United States.

“The next step, if we’re successful with the pilot, would be to look at Loop in store,” Mr. Gordon said. “But that’s a ways down the road.”

In Canada, Loop has also struck a partnership with Toronto-based Restaurant Brands International Inc., which will test reusable cups and other packaging later this year at some Tim Hortons locations in the Greater Toronto Area, and at Burger King restaurants outside of Canada.

Most of the President’s Choice products will be tested in the Loop system in their existing packaging – Loblaw reviewed its product line for items in sufficiently durable packages to be cleaned and reused – but the Decadent cookie will be the first package to be redesigned specifically for reuse. Loblaw’s test was initially planned for 2020, but was delayed because of COVID-19.

In Canada, just 9 per cent of the three million tonnes of plastic thrown away each year is recycled. According to a study by Deloitte for the federal environment department, 47 per cent of Canada’s plastic waste in 2016 came from packaging.

Loblaw is one of a number of companies around the world that have signed a pledge to redesign plastic packaging to make it more recyclable, organized by industry group the Consumer Goods Forum. For example, the retailer has been phasing out black plastic in its mushroom containers, in favour of a caramel-coloured plastic that more municipal recycling systems can process. But Greenpeace has called such recycling initiatives “false solutions,” and argues that companies should focus on eliminating single-use plastics altogether.

“Reuse already works in Canada,” Mr. Szaky said, citing systems such as beer-bottle returns.

The drawback of those systems, he said, is that they only work for a limited number of products. “What we believe is needed is the same approach as your recycling bin. Your recycling bin doesn’t care where you bought the bottle; it only cares that the bottle is recyclable. That’s the philosophy we think is needed for reuse.”

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