Returnable packaging systems and store operations: Processes, costs, and benefits

Abstract

Returnable packaging systems (RPS) related to consumer products help to reduce problematic plastic and glass waste in supply chains. The purpose of this paper is to investigate distribution and return processes and the related cost drivers and benefits of returnable packaging with a deposit refund system in retail stores. Through the lens of the actor–network theory and based on 30 interviews with store managers, including on-site observations, we develop a research model that structures key processes of RPS and their input and output factors. By subsequently applying system dynamics modeling, we find that: (1) customers’ process satisfaction, (2) price elasticity of demand, and (3) time between repeat purchases are key variables that impact RPS’ attractiveness and performance. This research contributes to an in-depth understanding of processes within RPS as well as interdependencies between cost drivers and benefits for retailers. From a managerial perspective, these insights can enable retailers to take action based on the influencing factors for efficient operations related to RPS. Finally, this research has policy implications as it provides argumentation for the commercial benefits of RPS for retailers aside from the overemphasized cost perspectives.