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[16 comments]

Do It Yourself All Over Again

February 16, 2010

By Bernice Hurst, Contributing Editor, RetailWire

Loose dry goods have long been available in supermarkets. Barrels with scoops and plastic bags or coffee grinders for beans to pour into paper bags were around way back "in the day" as the saying goes. Bringing your own containers and filling them with liquids may be a more 21st century activity designed to reduce packaging and the price we pay for it.

In an effort to reduce aforesaid packaging wastage, Wal-Mart's British chain, Asda, has devised a system whereby customers can "buy fabric conditioner from a vending machine, which pumps the liquid from a large vat in the stockroom directly into a pouch," according to The Daily Telegraph. As an added bonus, re-using the original plastic pouch reduces the price.

Wrap ("Material Change for a Better Environment") is a government-supported agency whose aims are to reduce waste, including the impact of packaging, and to help local authorities improve their collection and recycling schemes while benchmarking their costs and efficiency. The organization is contributing to Asda's trial and hopes that its success "could lead to additional liquid products, such as olive oil, shampoo, shower gel and possibly long-life fruit juice" being sold.

Wrap's retail director, Richard Swannell, explained, "Re-usable packaging offers us an opportunity to fundamentally rethink the retail experience. We have already seen positive responses from consumers in relation to carrier bag reuse. And if this trial enjoys similar success, it could mark the start of a reusable revolution."

Although a trial eight years ago was unsuccessful, possibly because there was no price differential, Asda's laundry buyer, Simon Spears, believes, "The potential for this is huge. All sorts of things could be rolled out if there is enough consumer appetite for it ... And the early indications are that consumers really enjoy it."

Discussion Questions: Are consumers ready for such re-usable packaging or has self-service gone too far? How viable a green solution is a refillable option?

[Author's commentary] This may not be news all over the U.S. but it has potential to spread. One New York-based colleague says he gets his dishwashing liquid from a fill-up station at a local green store. "Not so expensive either," he adds.

FINANCIALS:     [NYSE:WMT]

Discussion Questions



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Comments:

It will be interesting to see if this test is more successful than the first. I think price is a factor but the question is how much lower does it have to be to change buying behavior. My expectation if that it would have to be a reasonable discount in order to entice the consumer.

The lower price (an uniqueness of the concept) may induce trial but to change behavior the products must be convenient to store and use once the product is in the home. Dishwashing and other liquid soaps can be poured into a dispenser. The same is true for food products but I think the test will find that while people may be willing to buy nonfoods like that, they will be less likely to buy food items.

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Steve Montgomery, President, b2b Solutions, LLC

It's about time. I'm all for reducing packaging and waste as long as the financial incentive is there. Although I have to wonder about food items like cooking oil. How much work would it be to have to clean these containers prior to refilling them? Perhaps instead of refilling hard plastic containers, liquid products just get sold in one time use disposable bags.

Marc Gordon, President, Fourword Marketing

I don't think anecdotal incidents like these prove any kind of trend. Consumers are not demanding this and the value of ROI on such a program, in the big scheme, seems sub-par.

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Bob Phibbs, President/CEO, The Retail Doctor & Associates

So the obvious question is whether customers want manufacturers to provide less packaging, or none. I'm guessing the time-strapped customers will choose less....

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Cathy Hotka, Principal, Cathy Hotka & Associates

Demographics of smaller family units, aging populations, fewer adults getting married, etc, work against this model. In a consuming society, like the U.S., convenience trumps carrying a receptacle into a store to fill it with....

Limited appeal, and a challenge to implement in a broad number of stores.

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Roger Saunders, Managing Director, PROSPER BUSINESS DEVELOPMENT / BIGinsight

In theory this sounds like a good idea. Just like carrying your own bags to the supermarket in lieu of the plastic bag alternative. The problem is you have to change an entire culture, that is educating consumers about refillable options at the retail store. It sounds messy and inconvenient and as soon as a consumer has an unsatisfactory experience using this machine (such as being broken or spraying out on the consumer), you will have lost them.

There are numerous products on the market that allow you to refill at home which makes it a whole lot more convenient and easy on the consumer. There is a culture of about 10% (the Greenies) that will use this option regardless of the outcome or experience.

Refillable is one of the 6Rs of packaging for a more sustainable future but requiring the consumer to change existing shopping patterns makes this refillable option at the store good in theory but long on likelihood of success.

JoAnn Hines, Packaging Diva, PackagingDiva.com

A lot of consumers have already been doing this for years and I see the trend increasing. The way I have been doing it is buying heavily concentrated cleaning products and just adding water. The multi-level marketing companies like Shaklee and Amway have thrived on this.

I'm also taking my refillable 5 gallon water jugs to the store and refilling them for $1.95 versus paying $7 to have them delivered. Why not everything else?

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David Livingston, Principal, DJL Research

The intent here is sound, however, the real-world adoption may be a ways off. I think the likelihood for success has everything to do with the type of product involved. For household cleaning supplies, I think concentrated products to be reconstituted at home is working to a small degree. We'll see if that stays in the market for any length of time. However, with the BYOP (Bring Your Own Package) scenario, the adoption will be limited to how much work becomes involved. If it is a pain to transport, a better system will have to be developed.

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Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM

I have to agree with the majority of comments. Will the hassle of having to bring your own container be outweighed by the cost benefit?

And is Asda the right outlet for this? The customer profile of Asda is all about price and less about being environmentally friendly. For that, we need to look to our friends at Waitrose.

Also, on a really pragmatic note, who is going to be responsible for making sure kids don't use it as a toy and for cleaning up any drips and spills? Staffing levels in UK supermarkets seem to struggle just to keep the shelves stocked and the till queue to a reasonable level.

Averil Provan, Owner, Oblong Marketing

I think it may become less UNcommon, but that's quite a bit different from being common...it still seems like a rather inconvenient process for people, and convenience, after all, dictates most behavior. (A small semantics--and perhaps cultural--issue: I'm wondering if "dry goods" carries the same meaning in the UK as it does in the U.S.? I started off the article wondering what was being referred to as "loose.")

'notcom'

I can say that I was somewhat surprised on how much the trend of bringing your own shopping bags with you to a store, and somewhat more surprised as to how many localities began to tax behavior in this area. But I think now it is just the tip of the iceberg.

More and more packaging options will go away as governments see it as an income producing area as consumers become more "green" and as the cost of disposal by rule or by cost becomes more inconvenient.

Bulk may become a solution rather than a trendy merchandising tool.

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Charlie Moro, President, CFS Consulting Group, LLC

A journey of a thousand miles begins with a step. A plastic-free landscape begins with a refill. What an idea!

I understand the cynicism expressed above, but don't want to give in to it. Yes, changing habits is difficult. But, hard as it is to believe, there was a time when families didn't have kilos of daily garbage. Consumer goods companies, retailers, marketers changed that. And they achieved the change through sustained and dedicated effort over a several decades, until waste became the "cheapest" and easiest choice.

I think it's time to reverse the thrust on that flywheel.

Devangshu Dutta, Chief Executive, Third Eyesight

Until recently, my family regularly bought loose nuts in bulk from the local Safeway/Dominick's. The per-pound prices were clear, and via multiple small bags one could create the size and sort of mixed nut combo that worked best for ones family. Around Christmas time this option disappeared. Apparently forever. I was told by the produce manager that the health department nanny had decided the (covered) plastic bins with scoops offered too many opportunities for germs and disease and banned them.

Now, the only choice is sealed pre-packaged nuts in one size only (too big) hard plastic containers. Unless what people want and are willing to do stops being thwarted by government bureaucrats and agencies who believe they know best, the otherwise very excellent idea of serving yourself and re-using containers will not succeed in the US.

'Liatt'

In theory this is a great concept that unfortunately is not quite retail ready. Just to initiate this would require the use (and purchase) of standardized containers for each product sold, along with increased store personnel to stock and clean-up after each item is used (there is almost always spillage of the item sold). Add to this the risk issues of product going bad because it was not properly sealed or handled, either in the store, or on the way home /or in the home, along with homogeneity issues with the purity of product at the bottom of the dispenser compared with the top of the dispenser, light and heat issues on product that is stored in clear containers vs. colored containers (in-store as well as in the home), topping off issues and the costs aligned with this, container lifecycle issues and container failure needs, etc. The list is tremendous, and the savings (if any) are small to none.

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Kai Clarke, President, Miraclebeam Products, Inc.

Love the concept. The 'OVER'-packaging of ALL our goods is 'OVER' the top. This has to end. If this is the first step towards it, I'm all for it. To tell you the truth, the thought of carrying my own bags to the grocery store still irks me, but the adoption rate for this has been incredible. So over time, I would expect similar adoption rates for other products as well.

Rick Boretsky, Retail Data Integration Specialist, RIBA Retail (www.ribaretail.com)

Well, I agree with Bob; such one-off incidents cannot represent a trend. While this could to some extent work for smaller communities and for private labels, definitely not for national brands.

Shilpa Rao, Retail Consultant, Tata Consultancy Services

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