Has Recycling Proved to Be Overly Tedious and Expensive?

• February 19, 2020

Recently, we enjoyed an article written by Michael Corkery for The New York Times about the escalating waste crisis. Titled “Recycling Efforts Stall as the Cost Skyrockets”, he analytically examines an issue that will soon hit us right in the wallet—the cost of packaging waste disposal.

We want to talk about this because people often ask us, “What is the next big thing?” Well, it’s crucial to be aware of today’s trends in order to understand the business opportunities that present themselves.

China Isn’t Taking it Anymore

In January of 2018, China ceased acceptance of American recyclable materials. The plastics and cardboards they were looking for were mixed with too much waste for recycling to make sense. The nonprofit Recycle Across America’s Mitch Hedlund says, “Recycling has been dysfunctional for a long time. But not many people really noticed when China was our dumping ground.”

Recycling costs continue to skyrocket without a buyer. More recyclable materials end up in landfills, and municipal governments are pressured to raise taxes in order to cover these increased costs and find a better solution. Some cities are actually using incinerators, but residents are worried about air pollution. This is not an effective long-term solution.

Not a Level Playing Field

Producers of CPG products are especially feeling the pressure. Until now, they haven’t had to worry about the cost of recycling or disposing of their packaging. Their argument has two points:

First, they can argue that only a small percentage of customers will actually pay for sustainable alternatives, despite a larger number calling for them. We think this will no longer be the case, especially considering a recent Nielsen report on the subject. If cities start raising taxes to cover waste disposal costs, won’t this mean the consumer pays more for products anyway?

Second, CPG producers argue that they can’t compete with businesses that sell unsustainable packaging options. Yes, industry hates government control, but it seems to be the only thing that could level the playing field. What if disposable packaging was illegal? What if businesses were legally required to use reusable, returnable, or biodegradable options instead?

Confusion

There’s also the debate about what is actually considered “recyclable” or “sustainable”. If a recycling waste company moves their waste offshore instead, will it really be recycled? And if the only recycler in the area significantly raises their rates, what then? Many cities have already started subsidizing recyclers. And, if a type of plastic is turned into materials that can be reused for clothing, for example, what happens to the fibers after that use? Does the plastic residue become a more complicated problem? Now that China isn’t taking our recyclable wastes anymore, it’s suddenly our challenge to reuse them, dispose of them, or just find a better alternative.

“One Man’s Trash Is Another Man’s Treasure.”

This problem isn’t going away. It will just get worse. The obvious business opportunity that presents itself is to fix this problem.

We write about entrepreneurs who face these issues head-on to get ahead of the curve. Bonnie always says, “If you want to change the world, put a buck on it!” Or, go into business with a solution that’s less expensive than the more unsustainable option.

TerraCycle is an example of how to profit from finding the answer to this problem. They get right to the source. They’ll produce a reusable packaging system to be used by major brands. Their packaging will emerge in the market this year. If you have a sky-high garbage bill, wouldn’t you prefer packaging that doesn’t produce waste?

Synova is another example of a great, profitable solution. They come in at the other end of the process, at refuse facilities. They gasify plastic and bio waste through a proprietary process instead of incineration or burial, and use the resulting gas to produce power. The gas ends up offsetting the cost, therefore eliminating waste!

Just like these trendsetters, we want this article to encourage and inspire CPG companies to address every part of this problem, from packaging choices, to distribution, to collection, to waste elimination and power production. The next big thing is sitting right in your garbage can!

For more, read on: http://c-suitenetworkadvisors.com/advisor/michael-houlihan-and-bonnie-harvey/