Next time you are in Ireland, you may notice that when you buy a drink, the bottle or can it comes in has a Re-turn logo.
It means you will be charged a small refundable deposit. You can then claim back the levy by returning the empty container.
This is new bottle and can recycling system is known as the Deposit Return Scheme. The EU scheme was launched in Ireland on 1 February 2024. The scheme aims to achieve a 90% collection rate for plastic bottles across the EU by 2029.
It’s a wonderful idea that will reduce plastic pollution. EU countries such as Germany, Denmark, and Sweden, have implemented successful deposit return schemes, achieving high recycling rates for single-use drinks containers.
But there is a small snag. Different EU countries can have different rules when implementing the Deposit Return Scheme (DRS).
While the EU provides a general framework and sets minimum requirements through the Single-Use Plastics Directive, member states can design their national DRS to suit their specific needs. Differences can include deposit amount, scope of containers, collection infrastructure, labelling requirements and infrastructure.
For drinks firms, it’s a global, bureaucratic nightmare. How can they implement solutions to a Europe-wide law that is so complex?
To find the answers, Robert Baldock, MD of software consultancy Clustre, spoke to Chris Chittock, CEO and founder of Pivot. What follows are edited highlights of their conversation.
Robert Baldock: Let’s start by setting the scene. Why is the deposit return scheme important? Given that the UK is not in the EU anymore, does it matter to the UK?
Chris Chittock: “Since Brexit, the UK doesn’t have to comply with EU legislation. But, for companies selling drinks products in EU nations and beyond, there is no immunity. The penalties for breaking the laws are painful. We are talking lost sales. Punitive fines. Permanent reputational damage. This is an inescapable reality right across the world.
“Right now, there are 42 countries operating a deposit return scheme. More will follow. Multinationals are under extreme pressure to comply. This imperative is time and business critical.”
Given the size and scale of the challenge, this seems a golden opportunity for SAP. Couldn’t you find an existing piece of software that would tackle the job?
“Yes, we looked at the ready-baked solutions. But they were all country-specific. There was no scalable, reusable, built-in versatility. There’s a profound reason for this.
“Governments don’t understand – or even consider – the practical challenges of embedding new laws into business processes. Lawmakers set their own rules. And their own unrealistic deadlines. Implementation is someone else’s problem.
“The deposit return scheme is no exception. Companies are left with no time to develop flexible, global solutions. Everything is rushed and country specific.
“But multinationals cannot afford to repeat this endless reinvention across the world. It’s untenable.
“Someone had to break the mould.”
Who persuaded you to become the mould-breaker? And what were you looking to achieve?
“The ‘who’ part of your question is easy. We work with many multinational drinks giants. And one of them approached us to develop a deposit return solution for the Republic of Ireland.
“That was our starter challenge. But it wasn’t our final goal. We became fascinated by a much bigger question: could we build a core solution capable of scaling?
“The conventional big consultancy approach would be to design a monster solution for all conceivable legislation. But monster solutions have monster appetites for time and money.
“We were working to tight deadlines and even tighter budgets. Our imperative was to build a fast, cost-effective, core solution. It had to be a robust foundation we could flex and develop to meet any future legislation needs, anywhere in the world.”
You set out to build a time-critical solution for one country, in a constantly evolving regulatory climate, that will work across the world. That’s an ambitious goal. Walk me through the technical challenges.
“They aren’t trivial! One of the most fundamental issues is that all the existing deposit return scheme solutions are being developed in the Cloud.
“But not all companies – especially those starting on their SAP S/4HANA Cloud journeys – have the capability to use Cloud solutions. SAP’s own deposit return scheme is a case in point.
“Right from the start, we were determined to build an answer that – whether in or out of the Cloud – would deliver consistent results.
“And then we hit another problem: there’s no consistency of regulation. Every nation sets its own rules. There’s no one-size-fits-all solution.
“The global mission is to recycle around 90% of aluminium and plastic bottles, but that figure can – and does – vary between countries. It’s complex and messy. Certain nations include glass bottles in their legislation; others don’t. Some are more mature in their approach to setting sustainable goals than others. Countries have their own specific requirements and timetables.”
This is a complex undertaking. For anyone setting out to build a deposit return scheme solution, what would be your advice?
“Start by reaching out to the right people. Then ask them the right questions.
“Pivot is brought in to rescue enterprise software projects that are in serious difficulties. Time and again, we have traced the core reason for failure to a basic lack of project clarity. If you don’t define the needs of all key stakeholders at the outset, projects derail further down the line.
Make time to talk to every key stakeholder
“Deposit Return Scheme projects must include all the key stakeholders. That includes heads of sustainability, finance, tax, marketing, sales, packaging, supply chain and logistics, retail partners, and many more. Reach out to all of them. Understand their issues and perspectives. If you don’t invest time in talking to every group, you short-change the result.
“This is our mantra. Make time to talk to every key stakeholder.”
That’s a powerful message. But, talking about results, am I right in thinking this isn’t the endgame? I hear there more legislation is heading our way.
“Much more. And it’s going to impact every area of UK manufacturing.
“Soon, every manufacturer and retail brand will need Digital Product Passports. They will have to detail the exact origin of their raw materials. Food producers will have to identify the precise animal and farm of origin on all their packaging.
“Navigating this bureaucracy will be immensely challenging. The thinking we have invested in with the Deposit Return Scheme will play a vital role in developing advanced enterprise software solutions.”
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Chris Chittock and her team of SAP specialists are regarded as the supplier of choice for the global drinks industry.
When it comes to SAP, they have a greater depth of experience than all other practitioners. Their consultants display a deep knowledge of country requirements across the globe. They have an agile approach to legislative forces and changing markets. They win the respect of key stakeholders.
