Is it Time to Develop an Extended Producer Responsibility Strategy?

When it comes to evaluating your product’s packaging options, the concept of Extended Producer Responsibility (EPR) is probably not on your radar. But maybe it should be.

EPR is a public policy structure intended to foster the adoption of sustainable packaging practices and mitigate the environmental impacts of product packaging. Traditionally, EPR has focused on producers collecting and recycling the packaging they produce, although recent efforts have expanded EPR to include reducing packaging, using more sustainable materials and preventing litter.   

In concept, EPR is intended to shift financial and management responsibilities for collecting and recycling packaging from local governments and taxpayers to producers and consumers. In reality, costs incurred by businesses due to EPR would likely be passed along to the customer through increased product prices, so the end-user ultimately bears the burden of increased costs tied to EPR compliance.

While it may seem cost prohibitive to participate in EPR, especially if it isn’t yet mandated for your packaging content, many Fortune 500 businesses are already leading the way, which could spark wider industry change. For example, Coca-Cola and Nestle are focusing on waste reduction and sustainable packaging initiatives that reduce their carbon footprint.

 

A legislative quagmire

EPR is rooted in government legislation. Given the many levels of government with an interest in EPR policy, businesses may ultimately be faced with navigating through a morass of federal, state and local rules in order to comply with mandated recycled content percentages or certain material restrictions. EPR mandates could be a confusing combination of municipal, state or federal laws, the result of which could hinder, rather than help, EPR adoption.

 

Get ahead of the curve

Becoming an early adopter of EPR strategies could allow you to have your supplier base in position and processes running smoothly while the competition is just starting to think about their EPR strategies when legislation is looming.

Here are three ways to begin incorporating EPR into your product packaging strategy:

1. Identify a strategy, no matter how basic

Though it may seem counterintuitive to take on an initiative that could incur increased packaging costs, developing an EPR strategy could ultimately be beneficial because it could position your company as a thought leader when it comes to sustainability and environmentally-friendly issues. This perception could be a competitive advantage today with eco-minded customers, especially Millennials. Articulating and investing in an EPR strategy may also save on mandated waste/recycling costs down the road. Despite the initial time and money invested, creating an EPR strategy will ultimately pay dividends when your competition is struggling to sort out their strategy.

2. Ensure collaboration among all departments

It’s important to involve all departments that can help develop, promote and communicate the initiative to your employees and customer base. For example, bringing the marketing department on board to create customer-facing campaigns about the sustainability aspect could educate your customers about EPR and reinforce the efforts your company is taking to reduce its carbon footprint. This can be especially effective for small to mid-sized businesses who want to set themselves apart from larger players in an industry. Additionally, when multiple departments are involved, it’s possible to allocate a portion of the budgetary costs associated with sustainability initiatives. 

3. Find suppliers who can participate in the process

Many suppliers are looking for the opportunity to differentiate themselves from their competition – and they just might have resources to lend to the EPR discussion. Find a supplier (or several) who are willing and able to assist with your EPR initiative by providing an objective perspective as well as market intelligence. By involving your suppliers early on in the process, they will be in a better position to advise you on affordable packaging alternatives that could help offset the costs of implementing a more responsible packaging solution.

The concept of EPR will only gain momentum over time. Planning ahead—on your own timeline and without rigid mandates—provides a clear opportunity to develop and implement an EPR strategy that addresses today what will eventually be required tomorrow.  Whether reducing your company’s carbon footprint, eliminating unnecessary materials, incorporating recycled components into packaging, or one of dozens of other opportunities, you could find that you are well ahead of the competition and already recouping the cost benefits while others are forced to quickly meet much tougher future standards.  The time to act is now.

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