Reducing waste: It’s good for business

Businesses are embracing Government targets on waste reduction and diversion from landfill, using innovative methods to help the environment – and reap financial rewards.

Many large retailers, such as Marks and Spencer and IKEA, are aiming for zero waste to landfill, with some organisations voluntarily agreeing to reduce their packaging waste and others channelling waste back into their operations to achieve a “closed loop”, or circular economy.

The move to reduce waste is driven by the need to comply with legislation, as well as the increasing cost of energy, rising landfill charges, and the difficult economic climate. Defra estimates that companies lose 2% of their profits through resource mismanagement, and could save £23 billion per year simply by managing their resources more effectively – and with losses of this size, it is important that businesses take action.

Organisations worried about waste may follow the example of IKEA, which diverted 86% of its waste from landfill last year, and earned £120,000 from selling recyclable waste to reprocessors. Or they may take the lead from Silverburn shopping centre in Glasgow, which, over the course of six weeks, increased their recycling by 88% and halved their landfill costs in the process. According to Jonny Hazell, a Green Alliance Circular Economy Task Force policy advisor: “Large retail/commercial waste producers will increasingly turn costs into profits by taking steps to segregate waste streams and market them as resources.”

This is all very well for major suppliers, but for small and medium enterprises (SMEs) that do not have the infrastructure and resources enjoyed by the retail giants, there can be obstacles. Many local authorities provide no waste recycling for businesses, and those businesses using private waste contractors may be subject to prices being raised. So how can smaller retailers compete?

There are several ways to reduce waste and benefit financially in the long run – and the short term, and these centre on the idea of a “sharing economy”. Donating waste to charity is one way to pass on materials that might be useful to others. For example, if a clothes retailer takes unsold stock to charity shops, it can then be sold to others and the charity receives a revenue boost. Another method is for retailers to work collaboratively with other businesses that can process their waste; this might involve a food retailer passing on cooking oil to a company that can convert it to biodiesel.

Recycling Lives is already leading the way in partnership working. As a social business, its operations sustain charity through metal and waste recycling via its Community Dotcom schemes that deal with a range of waste products including disused furniture and other large goods. It is also committed to the circular economy, having recently hosted an event for product design specialists, which aimed to raise awareness of a Defra-funded Technology Strategy Board initiative worth £1.25 million, investigating design-led ways of improving products and systems so as to reduce waste and improve efficiency.

Whilst the idea may be to close the loop, this can only be achieved by being open to new ideas about waste management. That way, retailers can start to implement changes for the benefit of themselves – and the environment!