master thesis - nadya humaira - the challenges of circular
TRANSCRIPT
THE CHALLENGES OF CIRCULAR BUSINESS MODELS IN
FOOD DELIVERY SERVICES IN INDONESIA: REUSE AND
RETURN SYSTEMS FOR FOOD PACKAGING
Master’s Thesis
submitted in fulfilment of the requirements for the
academic degree “Master of Science”
at the University of Graz for the
“International Master’s Programme on Circular Economy”
by
NADYA HUMAIRA
Supervisor: Romana Rauter, Assoz. Prof. Mag. Dr.rer.soc.oec
Institute of Systems Sciences, Innovation and Sustainability
Research
Graz, 2021
i
Abstract
Food packaging contributes to a significant portion of the world’s plastic consumption.
Consequently, it generates an overwhelming flow of waste, mainly from single-use packaging,
which burdens urban and marine environments. In Indonesia, this is even more amplified with
the increasing popularity of online food delivery services, especially in the Covid-19 era.
Mainstream solutions include biodegradable alternatives and better recycling, yet it does not
answer the underlying issue of unsustainable consumption and production. The circular
economy concept has emerged as an answer to such issues. It endorses systems thinking, waste
elimination, optimization of material use, extensive integration of stakeholders and a grand
redesign of the idea of value, ownership and consumption in general. Reuse is an example of a
circular business model archetype which has been acknowledged as a promising solution to
single-use packaging waste. Hence this study focuses on a reusable and returnable model for
food packaging used in delivery services in Indonesia. Through scientific and grey literature
research and stakeholder interviews, this study aims to identify the characteristics of existing
reuse & return businesses, as well as the barriers, hotspots and stakeholder interaction within
the system. Results show that the design of the universal container and reverse logistics is a
core aspect in the business model. The barriers that were found to be most significant are cost,
inconvenience, distrust in quality control, lack of market attraction towards green products, and
compatibility. A rebound effect might occur, when the return rate is so low that the firm must
manufacture more new products, which defeats the idea of material optimization through a
reuse scheme and sharing economy. Ultimately, the main challenge is creating a seamless
system that makes sustainable consumption easy, inclusive, and financially attractive to all
stakeholders.
Keywords: circular economy, circular business model, reuse, return, food packaging
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Zusammenfassung
Lebensmittelverpackungen tragen erheblich zum weltweiten Plastikverbrauch bei.
Einwegverpackungen erzeugen enormen Abfall und belasten die städtische und marine
Umwelt. In Indonesien wird dieser Trend mit der zunehmenden Popularität von Online-
Lebensmittellieferdiensten, insbesondere in der Covid-19-Ära, verstärkt. Einige Lösungen
umfassen biologisch abbaubare Alternativen und besseres Recycling, sind jedoch je nach
Kontext und Effizienz nicht unbedingt nachhaltig. Als Antwort hat sich das Konzept der
Kreislaufwirtschaft herauskristallisiert. Es befürwortet Systemdenken, Abfallvermeidung,
Optimierung des Materialeinsatzes, umfassende Integration von Interessensgruppen und eine
umfassende Neugestaltung von Konsum und Produktion. Wiederverwendung ist ein Beispiel
zirkulärer Geschäftsmodelle, das als vielversprechende Lösung für Einwegverpackungen gilt.
Diese Studie konzentriert sich auf ein Mehrwegmodell für Lebensmittelverpackungen, die von
Lieferdienstplattformen in Indonesien verwendet werden. Durch Literaturrecherchen und
Interviews mit Interessenvertretern zielt diese Studie darauf ab, die Merkmale bestehender
Wiederverwendungs- und Rückgabeunternehmen sowie die Barrieren, Hotspots und die
Interaktion mit Interessenvertretern innerhalb des Systems zu identifizieren. Als wesentliche
Elemente des Geschäftsmodells erwiesen sich die Gestaltung der Behälter und die
Rücknahmelogistik. Die wichtigsten identifizierten Hindernisse sind Kosten, zusätzlich
entstehender Aufwand, Misstrauen gegenüber der Qualitätskontrolle, mangelnde
Marktattraktivität und Kompatibilität. Ein Rebound-Effekt ist möglich, wenn die
Retourenquote so gering ist, dass mehr neue Produkte hergestellt werden müssen. Damit wird
die Idee der Materialoptimierung durch ein Wiederverwendbarkeitssystem und eine Sharing
Economy zunichte gemacht. Die größte Herausforderung besteht darin, ein System zu schaffen,
das nachhaltigen Konsum bequem, inklusiv und finanziell attraktiv für die Interessengruppen
macht.
Stichworte: Kreislaufwirtschaft, zirkuläre Geschäftsmodelle, Wiederverwendung, Rückgabe,
Lebensmittelverpackung
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Acknowledgments
First and foremost, I would like to thank my supervisor, Assoz. Prof. Romana Rauter, for her
kind support and guidance throughout the whole thesis process, starting from the back-and-
forth brainstorming for my thesis topic.
My greatest gratitude goes to the Erasmus Mundus CIRCLE consortium for the opportunity
and funding of my studies. Moreover, I would like to thank my coordinators, Prof. Ulrika
Lundqvist and Dr. Ralf Aschemann, for their counseling and support to help me through my
master's studies.
A special thanks to Catalyze and PlastikDetox for the collaboration on this research project. It
was a pleasure to work alongside the team working hard to kickstart circular initiatives in
Indonesia.
Furthermore, I would like to express my most sincere appreciation to all respondents involved
in this study, both during the pre-test and the actual execution. I wish to send out my warmest
gratitude to the friends and family members who helped me reach out to all these respondents
in the first place, especially Aris, Gede Adi, Dinda, and Arya.
My warmest thanks to friends and colleagues in the Industrial Ecology and Circular Economy
program who are truly inspiring and have made these two years delightful, especially Shamita
Chaudhary, who has offered encouragement and many insights in the making of this thesis. My
most heartful thanks to Lena Rucker and Wikan Indrianingdyah Budiharto, who had given me
the push when I most needed it.
Lastly, I would like to thank my family, Muhammad Ikhsan and Fitri Wulandari, for their
unconditional emotional support throughout my studies.
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Table of Contents
Abstract ....................................................................................................................................... i
Zusammenfassung...................................................................................................................... ii
Acknowledgments.................................................................................................................... iii
Table of Contents ...................................................................................................................... iv
List of Figures .......................................................................................................................... vii
List of Tables ......................................................................................................................... viii
1. Introduction ........................................................................................................................ 1
2. Research objectives ............................................................................................................ 5
2.1. Research objectives and questions ............................................................................. 5
2.2. Relevance of research ................................................................................................ 5
3. Theoretical foundation ....................................................................................................... 6
3.1. Circular economy ....................................................................................................... 6
3.1.1. Development of the concept .......................................................................... 6
3.1.2. Definitions and principles .............................................................................. 8
3.1.3. Transitioning towards a circular economy .................................................. 11
3.2. Circular business models ......................................................................................... 12
3.2.1. Basic concept of business models ............................................................... 12
3.2.2. Sustainable and circular business models .................................................... 13
3.2.3. Circular business model strategies .............................................................. 15
3.3. Stakeholder theory ................................................................................................... 18
3.4. Food packaging ........................................................................................................ 22
3.4.1. Plastic packaging ......................................................................................... 24
3.4.2. Paper and cardboard packaging ................................................................... 25
3.4.3. Bio-based plastic packaging ........................................................................ 26
3.4.4. Glass packaging ........................................................................................... 26
3.4.5. Metal packaging .......................................................................................... 27
3.4.6. Life cycle assessments of food packaging materials ................................... 27
4. Problem & context definition........................................................................................... 34
4.1. Indonesia: an overview ............................................................................................ 34
4.1.1. Geography ................................................................................................... 34
4.1.2. Demographics .............................................................................................. 35
v
4.1.3. Economy ...................................................................................................... 36
4.1.4. Inequality ..................................................................................................... 37
4.2. Sustainable consumption and production in Indonesia ............................................ 37
4.3. Circular economy in Indonesia ................................................................................ 39
4.4. Indonesia’s single-use plastic waste problem .......................................................... 41
5. Methodology .................................................................................................................... 44
5.1. Desk-based research ................................................................................................ 46
5.2. Empirical study ........................................................................................................ 47
5.2.1. Stakeholder and respondent selection ......................................................... 47
5.2.2. Interview/focus group discussion guideline ................................................ 53
5.3. Qualitative content analysis ..................................................................................... 56
5.3.1. Transcription of interviews/discussions ...................................................... 56
5.3.2. Defining categories and code words ............................................................ 57
5.3.3. Analysis ....................................................................................................... 61
6. Results .............................................................................................................................. 63
6.1. Existing reuse & return models ............................................................................... 63
6.1.1. Overview of existing business cases ........................................................... 64
6.1.2. Typical characteristics ................................................................................. 69
6.1.3. Challenges and learnings from real business case ....................................... 78
6.2. Barriers ..................................................................................................................... 81
6.2.1. Cost benefit .................................................................................................. 90
6.2.2. Convenience ................................................................................................ 93
6.2.3. Complexity .................................................................................................. 95
6.2.4. Compatibility ............................................................................................... 96
6.2.5. Limited resources ........................................................................................ 97
6.2.6. Liability ....................................................................................................... 97
6.2.7. Environmental impact.................................................................................. 98
6.2.8. Quality control ............................................................................................. 99
6.2.9. Impact on brand ......................................................................................... 101
6.2.10. Niche market.............................................................................................. 102
6.3. Hotspots ................................................................................................................. 104
6.4. Stakeholder network analysis ................................................................................ 108
6.4.1. Value chain (primary) stakeholders ........................................................... 110
6.4.2. Value network (secondary) stakeholders ................................................... 112
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7. Discussion ...................................................................................................................... 115
7.1. Characteristics of reuse & return systems .............................................................. 115
7.2. Barriers & hotspots ................................................................................................ 117
7.3. Stakeholder network .............................................................................................. 120
7.4. Implications for the business model design ........................................................... 121
8. Conclusion ..................................................................................................................... 123
8.1. Limitations ............................................................................................................. 126
8.2. Outlook and future research ................................................................................... 126
Reference List ........................................................................................................................ 129
Appendix A: Focus group discussion and interview script and question guidelines ............. 143
Appendix B: Existing reuse & return food and beverage container business cases .............. 149
vii
List of Figures
Figure 1 Sustainable and circular business models.................................................................. 14
Figure 2 Typical stakeholder map............................................................................................ 19
Figure 3 Stakeholder map of the circular business ecosystem ................................................ 21
Figure 4 Mapping of drivers of food packaging use ................................................................ 23
Figure 5 Map of Indonesia ....................................................................................................... 35
Figure 6 Diagram of the research process ................................................................................ 45
Figure 7 Geographical scope of the study................................................................................ 48
Figure 8 Initial stakeholder mapping ....................................................................................... 51
Figure 9 Diagram of the reuse & return model shown to interview respondents .................... 55
Figure 10 Bar graph showing the significance of barriers per stakeholder group ................... 85
Figure 11 Bar graph showing the significance of barriers for customers and restaurants: Jakarta
vs. Bali ..................................................................................................................................... 87
Figure 12 Process flow diagram of the reuse & return system .............................................. 105
Figure 13 Bar graph showing the significance of hotspots per stakeholder group ................ 106
Figure 14 Stakeholder network map for reuse & return models of food packaging .............. 109
Figure 15 Material and monetary flows between stakeholders ............................................. 111
viii
List of Tables
Table 1 Definitions of circular economy ................................................................................... 8
Table 2 Circular business model strategies .............................................................................. 16
Table 3 Break-even point of climate change impact between reusable and single-use packaging
.................................................................................................................................................. 32
Table 4 List of Indonesian laws regarding sustainable consumption and production ............. 38
Table 5 List of respondents ...................................................................................................... 51
Table 6 Initial code system for the qualitative content analysis .............................................. 57
Table 7 Final code system for the qualitative content analysis ............................................... 58
Table 8 Summary of reusable & returnable food packaging business cases ........................... 76
Table 9 Global rank of barriers mentioned overall .................................................................. 83
Table 10 Rank of barriers mentioned per stakeholder group ................................................... 83
Table 11 Matrix of code relations: Barriers ............................................................................. 90
Table 12 Global rank of hotspots mentioned overall ............................................................. 106
1
1. Introduction
In the last half of the 20th century, plastic bags were popularized to replace paper and cotton
bags due to their superior quality (UNEP, 2018). They were stronger, more durable, multi-
functional, and easy to dispose of, the perfect combination of functionality and convenience.
The fossil fuel-based material was used for bags and a plethora of household goods such as
straws, bottles, and even fabrics. Plastic packaging also extends the lifetime of agriculture and
food products, hence reducing food waste and sustaining food supply chains.
Though this material served many purposes, its disposable nature dan durability eventually
became a destructive weapon to nature. The production of plastic resins and fibers increased
from 2 million tons in 1950 to 380 million tons in 2015, meaning an estimated 8.4% annual
growth (Geyer, Jambeck and Law, 2017). As plastic consumption grew worldwide, the waste
from single-use plastics gave rise to a new set of problems. The single-use plastic material is
so durable; it would not really degrade in nature. Instead, it would just break down into smaller
pieces which eventually turn into micro-plastics. They accumulated in our rivers and oceans,
posing a threat to marine animals and their ecosystem. They are also closely linked to emissions
contributing to climate change as they are primarily made of fossil fuel-based chemicals
(Lindwall, 2020). By 2015, an estimated 6,300 million tons of plastic waste has been generated,
most of which end up in landfills or the environment, and only 9% recycled and 12%
incinerated (Geyer, Jambeck and Law, 2017).
The disastrous impact of plastic waste is no longer a new phenomenon to the global
community. Its persistence in the environment makes it challenging to get rid of, and yet it is
so widely used in society that we still cannot achieve a plastic-free world. Bans on thin plastic
bags started in Bangladesh in 2002, and since then, many other countries have implemented
the same strategy to tackle the problem of plastic waste (UNEP, 2018). Though regulations and
recycling technologies have since been continuously developing, plastic waste pollution is still
a prominent issue today. Plastic waste has become such a norm that it may become a geological
indicator that characterizes the Anthropocene period (Geyer, Jambeck and Law, 2017).
The food and beverage (F&B) sector is very influential on global plastic consumption. From
the packaging of fresh produce to ready-made meals or drinks from restaurants and cafes,
plastics are heavily used to maintain freshness and allow for easy transportation. Packaging
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makes up approximately 36% of the global market for plastic production (Geyer, Jambeck and
Law, 2017). Meanwhile, in Europe, 60% of those are used for food and beverage packaging
(Matthews, Moran and Jaiswal, 2021).
Efforts to switch to more sustainable materials have been a popular topic of late, whether it be
producing bio-based plastics or going back to using paper and cloth materials for bags and
packaging. But recent research has shown that paper and cotton bags may not be more
environmentally friendly than plastic bags. The production of these “sustainable” bags actually
requires more energy; hence they need to be reused many times over to be more climate-
friendly than single-use plastics (Bell and Cave, 2011; Edgington, 2019). Some of these
alternative materials may not even be durable enough to outperform single-use plastics in terms
of environmental impact. Recycling is another option to tackle the plastic pollution problem.
Yet, in reality, recycling rates around the world are still low due to quality concerns and
difficulties in the separation of the multiple layers of polymers in food packaging (Geyer,
Jambeck and Law, 2017; Matthews, Moran and Jaiswal, 2021).
This scientific evidence shows that switching to alternative materials to replace plastics is
tricky and may not always give the best solution in the long term. This is primarily due to
society’s tendency towards a “throwaway culture” where we choose what’s convenient
(however short-lasting it may be) without deliberately thinking about the impacts it has on our
ecosystems. (Lindwall, 2020). It also serves as a remark towards our way of living and
consuming. According to the Global Footprint Network, we are consuming the earth’s natural
resources about 1,75 times more than what it can regenerate by itself (Asmelash and Ries,
2019). Whether it be fossil-fuel plastics, biodegradable paper products, or rare minerals, we are
consuming much more than what the earth can provide. Even then, we still have poverty,
hunger, and economic disparities worldwide. Hence, the question is not merely about which
materials give the least impact to the environment, but more importantly, which practices,
traditions, and habits allow us to lead sustainable lives. This concept is not limited to the
users/consumers side, but rather it also encompasses the producers’ responsibilities to ensure
sustainable economic activities. Consequently, this became a crucial aspect in creating a
sustainable future for the world. In fact, sustainable consumption and production was listed as
the 12th Sustainable Development Goal, which was formulated within the 2030 agenda for
members of the United Nations to follow in order to reach prosperity for humankind and the
earth and to ensure inclusive and positive growth (United Nations, no date).
3
A relevant and emerging concept that can help tackle sustainable consumption and production
is the circular economy. Popularized by the Ellen MacArthur Foundation, a circular economy
aims to create a system of doing business that deliberately reduces (or even eliminates) waste
and pollution, keeps products and materials in use for as long as possible, and which also
regenerates natural systems, not just deplete them (Ellen MacArthur Foundation, no date).
From a linear to a circular economy, this systemic transformation can be achieved through
changes in the neoclassical business models. A distinctive trait of a circular business model is
how it focuses on closing, slowing, and narrowing resource and material loops (Geissdoerfer,
Vladimirova and Evans, 2018). More specific examples of circular business models include
the reuse models (Ellen MacArthur Foundation, 2019), producer ownership models, sharing
platforms, and digital solutions (Lehtinen, 2020). This idea of circularity challenges the
conventional view on value, ownership, and consumption in general. Though there are various
emerging ideas of circular business models, most of the research in this field is focused on
European and Nordic countries. However, it has been acknowledged that African and Asian
countries show considerable potential to develop circular and sustainable business models (van
Bommel et al., 2020).
The reuse and take-back concepts have been acknowledged as promising solutions for the
circular economy transition, primarily through the optimization of material use (Ellen
MacArthur Foundation, 2019; Vegter, van Hillegersberg and Olthaar, 2020). In fact, “reuse,
repair, re-manufacture” is listed as an example of the “Create value from waste” sustainable
business model archetype proposed by Bocken et al. (2014). In a guidebook for “Rethinking
Packaging” by the Ellen MacArthur Foundation, the benefits accredited to reuse strategies
include increasing cost efficiency, having flexibility in customizing for individual needs,
achieving superior design, and building smart systems based on shared designs (Ellen
MacArthur Foundation, 2019). The guidebook lists several innovative start-ups and reuse
initiatives across the globe. In the examples for ready-made meals and beverage takeaway
services, most initiatives are still limited to only one merchant (e.g., DabbaDrop) or only one
specific type of packaging such as coffee cups (e.g., RECUP, Revolv) or one brand (Coca-Cola
Brazil). A larger scale of the reuse & return scheme was started by Loop in 2019, which
provides reusable packaging for various consumer products from major brands including P&G,
Unilever, Nestlé in the US, France, and UK. Though Loop is on its way to expand to other
countries such as Japan and Canada, the extent of their success in the first implementation is
still unclear, especially in terms of consumer acceptance.
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Closely related to the reuse concept and more largely covered in literature is the take-back
concept. Take-back schemes are usually linked to the Extended Producer Responsibility (EPR)
concept, where manufacturers are obligated to collect their products after being disposed of by
consumers (Sachs, 2006). Some scientific literature can be found which mentions the need for
take-back schemes in specific industries such as electronics (Botelho et al., 2016; Chen,
Kucukyazici and Saenz, 2019) and concrete or construction (Ramsheva, Moalem and Milios,
2020; Shooshtarian et al., 2021). Take-back schemes for single-use beverage packaging have
also mainly been introduced in Europe and North America, typically following certain
legislations that restrict the production of single-use packaging (CM Consulting and Reloop,
2016).
The take-back scheme is more of a downstream, end-of-pipe, and recycling approach;
meanwhile, the reuse scheme focuses more on upstream consumption and aims to prevent
excessive consumption. With proof of low recycling rates worldwide, it is now much more
relevant and urgent to develop upstream solutions like the reuse business model. The reuse
model focuses on collaborative consumption and creating a sharing economy by providing
durable products and sharing platforms/networks.
Some initiatives on food and beverage packaging reuse & return models for food delivery or
take-out services already exist, e.g., DeliverZero, Muuse, Returnr, RECUP, and CupKita.
These initiatives are characterized by reusable and returnable food packaging. However,
information is usually only available through grey literature, and the extent of their success is
not so clearly known. Muuse and CupKita are among the small initiatives in Indonesia, along
with Grab’s attempt at piloting a reuse & return scheme for their food delivery service. Yet,
the latter has not been promoted too largely nor continued on a larger scale. With the potential
of rising demand for food packaging that may be anticipated from higher consumption levels
in Indonesian residents, investigating the barriers and challenges in implementing such reuse
& return schemes is necessary to develop a circular economy.
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2. Research objectives
2.1. Research objectives and questions
This research study addresses the topic of circular business models, more specifically, the reuse
model regarding food packaging used by food delivery systems. First and foremost, this study
aims to identify the reuse & return model characteristics through a review of existing business
cases. Then, because the integration of stakeholders is an essential part of circular business
models, a range of different stakeholders will be involved. Thus, the anticipated barriers,
hotspots, and interactions of stakeholders can be investigated. Therefore, the research questions
are formulated as follows:
RQ1. What are the characteristics of existing reuse & return models for food packaging in food
delivery systems?
RQ2. What are the barriers and hotspots of reuse & return models for food packaging in food
delivery systems in Indonesia from the perspectives of different stakeholders?
RQ3. How do the stakeholders interact in this network of online food delivery services?
2.2. Relevance of research
This study will give more practical insight into how circular business models can be applied in
real life, specifically reuse & return schemes in the food service sector in Indonesia. The
findings are expected to reflect the challenges in implementing circular economy strategies
such as the reuse and returnable packaging model, specifically in the context of a developing
country, hence acknowledging the possibility of the different ways eastern/developing societies
adapt to sustainability challenges compared to western/developed societies. Involving a diverse
range of stakeholders within this study allows us to deduct a holistic view of how society works
and interacts and eventually can be used to develop sustainable and circular futures better.
Besides the practical relevance, this research study will also contribute to the growing body of
scientific work on circular business models. This study will focus on one specific circular
business model archetype that is “reuse” hence will provide deeper insight into the challenges
of this particular model. By taking Indonesia as the geographical scope, this research will also
give more representation of the developing world in the research field of circular economy and
circular business models.
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3. Theoretical foundation
This part of the report will describe the theoretical concepts that support the topic of this study.
Based on literature review, the following parts will discuss the concept of circular economy,
circular business models, the stakeholder theory, and the different materials used for food
packaging.
3.1. Circular economy
The sustainability challenges that have become the hallmark of the 21st century include global
warming, overconsumption of natural resources, and social injustice (Murray, Skene and
Haynes, 2017). The constant debate over who is most responsible for these problems
(governments, companies, or society itself?) have yet been resolved. Still, there is increasing
attention from the public that current business practices are contributing largely to these issues
due to their wasteful and unsustainable nature. The dependency of the current economy on
finite resources coupled with great industrial growth has led to direct impacts on businesses,
like price volatility of raw materials and disruptions within the supply chain. In fact, price
volatility for metals, food, and non-food agricultural products were higher between 2000-2010
than in any decade in the 20th century (Ellen MacArthur Foundation, 2013).
In the meantime, the concept of “circular economy” has emerged in the transition towards
finding alternative business models that support a sustainable future (Murray, Skene and
Haynes, 2017). There is a growing pool of work on the topic of circular economy and a plethora
of views on how it is defined. Nevertheless, it is generally regarded as an economic system that
is regenerative and aims to eliminate waste through closed-loops solutions as well as
maximizing material value for as long as possible throughout its life cycle and through all
stages of the supply chain (Abuabara, Paucar-Caceres and Burrowes-Cromwell, 2019; Ellen
MacArthur Foundation, 2013; Murray, Skene and Haynes, 2017).
3.1.1. Development of the concept
Though traces of the concept of circular economy can be linked to as far back as 1966, more
attention has been drawn towards the topic over the last decade, with the number of reviews
and articles covering the topic increasing rapidly since 2014 (Geissdoerfer et al., 2017). A large
portion of these studies, and consequently legislations surrounding circular economy, originate
from China, Japan, USA, and European countries: the UK, Netherlands, Italy, Sweden, and
7
Germany (Geissdoerfer et al., 2017; Ghisellini, Cialani and Ulgiati, 2016; Murray, Skene and
Haynes, 2017). Some notable reviews of the circular economy topic that illustrate its origins,
development, and implications in a global context include the works of Geissdoerfer et al.
(2017), Ghisellini, Cialani and Ulgiati (2016), and Murray, Skene and Haynes (2017).
The concept of circular economy can be traced back to the works of environmental and
ecological economists Boulding (1966) and Pearce and Turner (1989), where the environment
is proposed to have three essential economic functions: provision of resources, life support
system, and sink for waste and emissions (Geissdoerfer et al., 2017; Ghisellini, Cialani and
Ulgiati, 2016). Boulding (1966) also describes the earth as a closed system with limited
capacity, implying that the economy needs to coexist in balance with the environment
(Geissdoerfer et al., 2017). Already, these 20th-century works note that the circular economic
system could provide a sustainable future for humans on earth (Ghisellini, Cialani and Ulgiati,
2016).
The circular economy is also often linked to the concept of industrial ecology (Andersen, 2007;
Bocken et al., 2016; Geissdoerfer et al., 2017; Ghisellini, Cialani and Ulgiati, 2016; Murray,
Skene and Haynes, 2017). Ghisellini, Cialani and Ulgiati (2016) remark that industrial ecology
covers the concept of industrial metabolism (how the industrial system works and its interaction
with the environment) and is characterized with proactivity, essentially meaning that it can be
used to improve corporate performance or help governments plan for sustainable development.
The industrial ecology perspective endorses resource minimization, closed material and energy
cycles, and cleaner technologies, ultimately reducing waste and the use of virgin materials in
industrial activities (Andersen, 2007; Ghisellini, Cialani and Ulgiati, 2016).
Nowadays, the term circular economy is often mentioned to imply the opposite of the
conventional, business-as-usual, linear economy. The linear economy is characterized by the
process of converting natural resources into products which then eventually become waste
(Murray, Skene and Haynes, 2017). An analogy for the linear economy is a “take-make-
dispose” model, where businesses extract raw materials from the environment, use them to
make products, sell them to consumers who then dispose of it once it is no longer of use to
them (Ellen MacArthur Foundation, 2013). Andersen (2007) describes this conventional
economy as an open-ended system, where the flow starts with the extraction of natural
resources, then continues with production, consumption and ends with the achievement of
utility or welfare. In this system, waste or residuals that occur are not considered. This
8
conventional, mainstream, or neoclassical perspective of economics focuses primarily on the
efficient allocation of resources in the market but does not comprehensively consider the
planet’s limitations in providing natural resources (Ghisellini, Cialani and Ulgiati, 2016).
Meanwhile, the flow of global material extraction is expected to increase drastically from 79
billion tons in 2011 to 167 billion tons in 2060 (OECD, 2018). This means that the average
individual consumption of materials per day will rise by 10 kg between 2011 and 2060 (OECD,
2018).
In contrast, the very foundation of the circular economy is the acknowledgment of planetary
limits of resource and energy, looking at the planet as a system where waste and pollution need
to be avoided (Bocken et al., 2016). The circular economy should restore the damage done to
the environment throughout the whole life cycle of the product while also generating as little
waste as possible (Murray, Skene and Haynes, 2017). Andersen (2007) notes, however, that
the circular economy perspective focuses more on the system's physical properties rather than
its economic performance.
3.1.2. Definitions and principles
With a growing body of literature, there are various definitions and perspectives on the
conceptualization of the circular economy. Table 1 summarizes some of these definitions.
There are, however, some keywords that seem to be a common theme of these
conceptualizations, namely:
• Restorative, not just reducing pollution but also repairing the damage and designing
better systems
• Cradle-to-cradle, ensuring that human activities have no impact on the environment
throughout the whole life-cycle, and generating minimal waste
• Closed-loop economy (Murray, Skene and Haynes, 2017).
Table 1 Definitions of circular economy
No. Definitions of a circular economy Reference
1. “an industrial system that is restorative or regenerative
by intention and design. It replaces the ‘end-of-life’
concept with restoration, shifts towards the use of
renewable energy, eliminates the use of toxic chemicals,
which impair reuse, and aims for the elimination of
Ellen MacArthur Foundation (2013, p. 7)
9
No. Definitions of a circular economy Reference
waste through the superior design of materials, products,
systems, and, within this, business models.”
2. “a regenerative system in which resource input and
waste, emission, and energy leakage are minimised by
slowing, closing, and narrowing material and energy
loops. This can be achieved through long-lasting design,
maintenance, repair, reuse, remanufacturing,
refurbishing, and recycling.”
Geissdoerfer et al. (2017, p. 759)
3. “an economic model wherein planning, resourcing,
procurement, production and reprocessing are designed
and managed, as both process and output, to maximise
ecosystem functioning and human well-being.”
Murray, Skene and Haynes (2017, p. 369)
4. “a generic term for the activities of reducing, reusing
and recycling in production, circulation and
consumption.”
Order of the President of the People's
Republic of China No. 4: Circular economy
promotion law 2008 (2008, p. 1)
5. “(an economy) where the value of products, materials
and resources is maintained in the economy for as long
as possible, and the generation of waste is minimised.”
Communication from the Commission to the
European Parliament, the Council, the
European Economic and Social Committee
and the Committee of the Regions: Closing
the loop - An EU action plan for the circular
economy 2015 (2015, p. 2)
The Ellen MacArthur Foundation has become quite influential in the development and
diffusion of the circular economy movement (Geissdoerfer et al., 2017; Murray, Skene and
Haynes, 2017). With multiple reports and toolkits published by the Ellen MacArthur
Foundation, they have also become a hub for collaboration for policy makers, businesses and
researchers (Geissdoerfer et al., 2017).
Much like the Ellen MacArthur Foundation, Murray, Skene and Haynes (2017)’s
conceptualizations also highlight the importance of two cycles within the circular economy:
the biogeochemical cycles and the recycling of products. Concerning biogeochemical cycles,
the circular economy aims to restore natural flows (meaning no excessive removal of material
from the cycle nor excessive release of material into the cycle). Meanwhile, in regards to
recycling, Murray, Skene and Haynes (2017) extend the idea to the industrial symbiosis
concept of taking one firm’s waste as the other’s resource, or the concept of providing better
manufacturing and maintenance services to prolong the product lifetime therefore reducing the
initial resource use.
10
Meanwhile, three fundamental principles were proposed by Ellen MacArthur Foundation
(2015):
• Preserve and enhance natural capital, meaning that the flow of renewable resources
should be kept in balance while stocks of non-renewable resources should be kept in
control
• Optimize resource yields, by keeping products and materials’ value throughout the
cycle, extending product lifetimes
• Foster system effectiveness, designing out negative externalities (pollution, waste,
toxins, etc.)
Some benefits of the circular economy are material cost savings in material and reduced
vulnerability to price volatility. Ellen MacArthur Foundation (2013) identified potential
savings for material cost up to USD 380 billion annually for just the EU manufacturing sectors
in a transitional scenario. In an advanced circularity implementation, this number could go up
to USD 630 billion. Further benefits of the circular economy include potential job creation and
having a more resilient ecosystem and economy (Ellen MacArthur Foundation, 2015).
Ghisellini, Cialani and Ulgiati (2016, p. 27) note that the circular economy is “not an
appropriate tool for growth-oriented economic systems.” It cannot promise further economic
growth, and the likeliness of rebound effects and diminished benefits due to market competition
is very high.
Furthermore, limiting the circular economy to “better waste management” may lead to failure
because recycling, reuse, or recovery methods in certain conditions or after a certain cut-off
point, might cease to become beneficial both financially and ecologically. It is practically
impossible to create a completely circular economic system due to the limitations of nature
itself to convert products and energy back to raw materials (Andersen, 2007; Ghisellini, Cialani
and Ulgiati, 2016). Ghisellini, Cialani and Ulgiati (2016, p. 12) note that creating a circular
economy calls for a “comprehensive look at the design of radically alternative solutions, over
the entire life cycle of any process as well as the interaction between the process and
environment and the economy in which it is embedded, so that the regeneration is not only
material or energy recovery, but instead becomes an improvement of the entire living and
economic model compared to previous business-as-usual economy and resource management.”
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Hence, an integral part of creating a circular economy is the ‘design to re-design’ systemic
thinking and creating maximum value through new perspectives of production and
consumption to decouple economic growth from environmental degradation of resource
extraction (Ghisellini, Cialani and Ulgiati, 2016; Murray, Skene and Haynes, 2017). Having
the circular economy in mind in the early stages of product design is crucial because once the
product specifications are set, it would be difficult to alter the materials, equipment, and
activities midway (Bocken et al., 2016).
3.1.3. Transitioning towards a circular economy
The transition towards a circular economy looks different depending on the regional context
and the scale. At the macro level, in the Chinese context, circular economy is embedded into
the national policies to regulate their industries and organizations of society at all levels. In
China, the circular economy concept is diffused with the top-down approach following a more
“command and control” method. Meanwhile, the implementation in Europe and Japan follows
a more bottom-up or market-based approach. In Europe, environmental organizations and
society are demanding and eventually driving change in government regulation and corporate
activities. While in Japan, the circular economy transition is driven by engagement and
collaboration with a wide range of stakeholders, including the government, the public, and
manufacturers as well (Ghisellini, Cialani and Ulgiati, 2016). At a city or regional scale, the
circular economy involves more complex networks, like industrial parks where factories of
different industries are integrated into one system of resource cycling within a particular area
(Su et al., 2013). Another strategy within the circular economy is the collaborative
consumption model or shared ownership model. Examples are car-sharing services, sharing
platforms for books, clothing, furniture, etc. In such business models, consumers pay a fee to
rent or use a service without having ownership over the product or service (Ghisellini, Cialani
and Ulgiati, 2016).
At the micro-level, the transition towards a circular economy starts with eco-design, green
design, design for environment (DFE), and cleaner production (Ghisellini, Cialani and Ulgiati,
2016; Su et al., 2013). These concepts basically submerge environmental aspects from the very
beginning of the design and development of products/services to avoid extensive impacts to
the environment throughout the whole life cycle while also keeping high quality standards and
optimizing value or performance. Another instrument used to foster circular economy from the
consumer’s perspective is eco-labeling. Different types of labeling schemes have developed all
12
around the globe. The concept is mainly about applying strict environmental performance
criteria to products and services (Ghisellini, Cialani and Ulgiati, 2016).
Abuabara, Paucar-Caceres and Burrowes-Cromwell (2019) note the importance of various
stakeholders to build a circular economy, namely consumers, businesses, and governments.
Understanding consumer behavior is a critical challenge in redesigning supply chains. There is
also a new emerging market of conscious consumers who are demanding sustainable products.
Collaborations with businesses are needed to gain new perspective on organizational practices.
The circular economy implies a need for a systemic shift and redesign of systems, which is a
challenge for businesses as they need to orient their organizational practices and technologies.
As for governments, their role as policy-maker is also crucial in supporting and enabling
circularity. Governments can shape the barriers and context in which businesses and consumers
align themselves through legislation and incentives(Abuabara, Paucar-Caceres and Burrowes-
Cromwell, 2019).
3.2. Circular business models
One of the core elements needed to foster the transition from business-as-usual to a circular
economy is the implementation of alternative business models (Ellen MacArthur Foundation,
2013; Murray, Skene and Haynes, 2017). These alternative business models are often called
sustainable or circular business models. Before discussing more specifically on circular
business models, the basic concept of “business model” will be introduced first, followed by
sustainable business models, then further into circular business models, its key aspects,
strategies, and archetypes.
3.2.1. Basic concept of business models
A business model is a representation of the way a company does business (Bocken et al., 2016),
more specifically in regards to its value proposition, value creation, and delivery, value capture
elements, and the interactions between all these elements (Geissdoerfer, Vladimirova and
Evans, 2018). Nielsen and Lund (2013) describe that the business model defines how a
company combines its know-how and resources to deliver its value proposition. A business
model is typically built upon a set of elements:
• Value proposition, what is the value in the product/service that the business offers
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• Supply chain, how are the upstream interactions and relationships with suppliers
managed
• Customer interface, how are the downstream relationships with customers managed
• Financial model, what are the costs and benefits pertaining to the previous elements
and how are these distributed among the firm’s stakeholders (Boons and Lüdeke-
Freund, 2013).
The business model further shapes the structure of the business and sets the paths for expansion.
However, changing the business model of an already established company is often difficult.
Meanwhile, the transition towards a circular economy entails radical change of conventional
business models (Bocken et al., 2016).
3.2.2. Sustainable and circular business models
Stubbs and Cocklin (2008) proposed that the creation of a sustainable business requires a
fundamental change of the neoclassical economic model and not merely supplementing the
business model with social and environmental agendas. van Bommel et al. (2020, p. 2) define
a sustainable business model as “the creation of value through the integration of economic
prosperity, environmental integrity and social equity among society at large, rather than
prioritization of organizational profit”.
In general, definitions in literature have four common aspects or attributes that they attach to
the “sustainable business models”:
• Focally concentrated on sustainability and the triple bottom line (environment, social,
and economy)
• Extending the concept of value and value creation, challenging traditional views of
value, utility, and success
• Considers the interests of a wide range of stakeholders, not limited to shareholders but
also employees, suppliers, and other actors along the supply chain, the environment,
and the community
• Emphasizes a broader systems perspective, acknowledging the need for long-term
planning and interaction of many actors within a complex and large system
(Geissdoerfer, Vladimirova and Evans, 2018; van Bommel et al., 2020).
14
Circular business models are generally regarded as a subset within sustainable business models,
along with base-of-the-pyramid models and product service systems (Geissdoerfer,
Vladimirova and Evans, 2018). While sustainable business models are defined by proactive
multi-stakeholder management, creation of value for a wide range of stakeholders, and having
a long-term perspective, circular business models more specifically focus on dematerialisation,
as well as closing, slowing and narrowing resource loops (Geissdoerfer, Vladimirova and
Evans, 2018). Circular business models provide economically viable options for reusing
products and materials, utilizing renewable resources wherever possible (Bocken et al., 2016).
Geissdoerfer, Vladimirova and Evans (2018) illustrate the transition from linear business
models to sustainable and circular business models as shown in Figure 1.
Figure 1 Sustainable and circular business models
(Geissdoerfer, Vladimirova and Evans, 2018, p. 405)
Geissdoerfer, Vladimirova and Evans (2018) also state that the transition towards sustainable
business models often faces obstacles, with many implemented models rolled out as start-ups
eventually failing in the market. The main challenge lies in the inertia to change the existing
business models, primarily due to incumbent companies' resistance and technological or
systemic lock-ins. Similarly, van Bommel et al. (2020) note that understanding the context in
which the business is embedded (ecosystems, stakeholders, and institutions) is needed to better
develop, implement and manage sustainable business models.
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3.2.3. Circular business model strategies
There are various frameworks and strategies outlined by academia and organizations that aim
to support the transition to a sustainable and circular economy. The first to be highlighted in
this report is by Bocken et al. (2014), which identified common categories and generic
mechanisms of sustainable business models. The study resulted in the conceptualization of 8
archetypes of sustainable business models with a broad range of examples to help communicate
business model innovations to businesses (Bocken et al., 2014). Though these archetypes are
not specific on circular business models, some are quite relevant to achieve circularity. The
eight archetypes are described briefly below:
• Maximize material and energy efficiency: doing more with fewer resources and
generating less waste and emissions (e.g., low carbon manufacturing, increased
functionality, dematerialization)
• Create value from waste: turning waste streams into valuable feedstock to other
processes, as well as making better use of under-utilized capacity (e.g., closed loops,
cradle-2-cradle, industrial symbiosis, reuse-recycle-re-manufacture, take back
management, extended producer responsibility, shared ownership, collaborative
consumption)
• Substitute with renewables and natural processes: increase resilience by
acknowledging resource constraints and shifting away from non-renewable resources
(e.g., solar and wind power-based energy, zero-emissions initiative, biomimicry)
• Deliver functionality rather than ownership: delivering value through services
without giving ownership over physical products (e.g., use oriented product-service-
systems, result-oriented product-service systems, pay-per-use)
• Adopt a stewardship role: providing products and services that are proactively
engaging with stakeholders to ensure long-term health and well-being (e.g.,
biodiversity protection, ethical/fair trade, radical transparency)
• Encourage sufficiency: solutions to reduce consumption and production (e.g.,
consumer education, product longevity, slow fashion, frugal business)
• Repurpose for society/environment: prioritizing social and environmental benefits
over maximizing economic profit (e.g., social enterprise, base of pyramid solutions,
localization)
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• Develop scale-up solutions: expanding sustainable solutions to a larger scale to
maximize benefits to society and the environment (e.g., collaborative approaches,
incubation, open innovation platforms, crowd sourcing) (Bocken et al., 2014).
In a later work by Bocken et al. (2016), strategies that are specific to the circular economy were
presented, all of which focus on the concept of resource cycling and also in line with
Geissdoerfer, Vladimirova and Evans (2018)’s conceptualization of a circular economy shown
in Figure 1. The following lists the three approaches to circular business model strategies
proposed by Bocken et al. (2016) :
• slowing resource loops, by designing products with long lifetimes and facilitating
service, repair, remanufacturing in order to extend the products’ life
• closing resource loops, by recycling
• narrowing resource flows, achieved through resource efficiency, using fewer resources
per product, being eco-efficient (Bocken et al., 2016).
Bocken et al. (2016) further elaborated on the former two and defined their relevant business
model innovations (mainly in the Netherlands and European context) as summarized in Table
2.
Table 2 Circular business model strategies
(Bocken et al., 2016, p. 313)
No. Business model strategies Definition Examples
SLOWING LOOPS
1 Access and performance
model
Delivering value or service without
giving ownership over the product
to the consumer
Car sharing, leasing jeans, leasing
phones, document management
systems (scan and printing
machines), e.g., Xerox, Kyocera
2 Extending product value Utilizing residues or collecting
products between businesses to go
back into manufacture
Automotive industry,
remanufacturing parts, clothing
returns
3 Classic long-life model Delivering long-product life,
designing for durability and repair
White appliances, luxury products
that are meant to last more than a
lifetime, e.g., luxury watches
4 Encourage sufficiency Reduce end-user consumption
through durability, upgradability,
service, reparability, and non-
consumerist approach to marketing
and sales
Premium, high service, high
quality, energy service companies
CLOSING LOOPS
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No. Business model strategies Definition Examples
5 Extending resource value Collection and sourcing of waste
materials or resources to turn into
new value
Interface (collect fishing nets as
raw material for carpets)
RecycleBank (giving reward points
to customers for recycling)
6 Industrial symbiosis Connecting businesses within close
proximity so that one’s waste
becomes the other’s feedstock
Eco-industrial park
The Ellen MacArthur Foundation also formulated a framework of business actions to support
implementation in countries and businesses. The ReSOLVE framework was developed to help
these entities create their own circular strategies, as elaborated below:
• REgenerate: shifting to renewable energy and materials, recovering biological
resources to the biosphere
• Share: maximize utilization of products, using the shared ownership model, prolonging
the lifetime of products through maintenance, repair, and durable design
• Optimize: increasing the efficiency of a product, removing waste from the whole supply
chain, utilizing big data, automation, and other technologies
• Loop: keeping materials in closed loops, especially inner loops, remanufacturing and
recycling materials.
• Virtualise: dematerialize by delivering value virtually e.g. books, music, online
shopping, virtual offices.
• Exchange: applying new technologies such as 3D printing, electric engines, choosing
new products/services (Ellen MacArthur Foundation, 2015).
Orasmaa, Laurila and Liimatainen (2020) provided 5 circular economy business models from
their review of case studies in Finland and Europe, elaborated below:
• Product-as-a-service, providing services instead of products
• Renewability, utilizing renewable and recyclable materials, as well as renewable
energy, in the production process
• Sharing platforms, facilitating collective use of products and resources through renting,
selling, sharing, and reuse to extend the life cycle of otherwise quickly disposable
products or products that a single user cannot optimally use
• Product-life extension, supporting maintenance, repair, and refurbishment to foster the
use of products for as long as possible
18
• Resource efficiency and recycling, applying material and energy-efficient solutions,
also implementing collection, reuse, and recycling of discarded products.
The different characterizations discussed above show that there is a growing number of work
and case studies that showcase various emerging ideas of circular business models. van
Bommel et al. (2020) note that most of the research in this field is focused on European and
Nordic countries, though African and Asian countries also show considerable potential.
3.3. Stakeholder theory
The very concept of sustainable business models (and consequently, circular business models
as well) puts a strong emphasis on multi-stakeholder management, meaning that the business
prioritizes not only the shareholders’ demands for economic profits, but also consumers’ needs
in regards to welfare fulfilment and environmental conservation (Stubbs and Cocklin, 2008;
van Bommel et al., 2020). Stubbs and Cocklin (2008, p. 115) also noted that the stakeholder
theory highlights the need for “relentless communication to all stakeholders as well as
extensive stakeholder education on sustainability issues”. The need to integrate a diverse range
of relevant stakeholders, including consumers as well as academics, from early on in the
innovation process is vital to increase chances of success in the market, and more generally to
help identify unexpected interactions within the system (Freeman, Harrison and Zyglidopoulos,
2018; Goodman, Korsunova and Halme, 2017).
The stakeholder theory was popularized mainly from the work of Freeman (1984), proposing
the agenda to change the perspective on business and the economy in times of globalization
and turbulent change in the market. Freeman et al. (2010) also highlight other changes that the
21st century has brought to the business world: the dominance of information technology, the
fall of centralized state governance and planning, and the growing awareness from society
about the impacts of business on the community. The stakeholder theory was developed to
change the mindset that the purpose of a business is limited to maximizing value for its
shareholders. It also aims to address the separation fallacy, where business and ethics were
seen as separate entities where one does not affect the decisions of the other. It also aims to
provide managers with a better framework for planning their business in times of ever-changing
markets and technology. In a world where customers are increasingly demanding transparency
and responsibility from businesses, merging the concepts of capitalism, ethics, sustainability,
and social responsibility is much needed (Freeman et al., 2010).
19
Based on Freeman (1984), Freeman, Harrison and Zyglidopoulos (2018, p. 1) define
stakeholders as “groups and individuals that have a valid interest in the activities and outcomes
of a firm and on whom the firm relies to achieve its objectives”. Typically, the primary
stakeholders include customers, employees, and suppliers, while other relevant stakeholders
may include the government, the media non-governmental groups, and special-interest groups,
depending on the company (Freeman, Harrison and Zyglidopoulos, 2018). The stakeholder
theory implies that businesses need to focus on the interests of and creating value for all
stakeholders, both for those that have direct and indirect impacts on the business (Freeman et
al., 2010).
Figure 2 shows the stakeholder map conceptualized by Freeman, Harrison and Zyglidopoulos
(2018), where they identify two groups of stakeholders: primary and secondary. Primary
stakeholders are those that have direct impacts on the firm, meaning that they are directly
involved in value creation. The more apparent values are economic benefit: product or service
for the customers, job security and salary for employees, and payment of materials bought for
suppliers. But other values could be emotional satisfaction, respect, network connections, and
even political influence (Freeman, Harrison and Zyglidopoulos, 2018).
Figure 2 Typical stakeholder map
(Freeman, Harrison and Zyglidopoulos, 2018, p. 16)
20
Though having no direct impact on the value creation process, the secondary stakeholders act
as “influencers” which can affect the views and interests of primary stakeholders. This
influence could be a positive or negative effect on the business. For instance, if an
environmental group protests the firm for a specific cause that they believe the firm is hurting,
customers could change their minds about their perception of the firm. As a preventive stance,
keeping close relationships with these stakeholders is quite vital to a firm. Other than the threat
of secondary stakeholders ruining the firm's reputation, these stakeholders may also have
access to useful information that can help the firm in widening value creation (Freeman,
Harrison and Zyglidopoulos, 2018).
It is also worth noting that the line between the primary and secondary stakeholders is dotted,
meaning that the boundary is not fixed. This implies that stakeholders from one group could
move to another (Freeman, Harrison and Zyglidopoulos, 2018).
Another classification of the stakeholder groups is given by Bertassini et al. (2021), as shown
in Figure 3. While Freeman, Harrison and Zyglidopoulos (2018)’s concept of stakeholders
applies to a general business ecosystem, Bertassini et al. (2021) focused on the circular
economy context, highlighting the concepts of systemic thinking and circular captured values.
Here, the stakeholders are grouped into three categories: internal stakeholders, value chain
stakeholders, and value network stakeholders. Internal stakeholders are identified as the people
managing the organization’s decisions and activities, including the shareholders, employees,
and managers. The value chain stakeholders are those who are directly affected by and/or
directly affecting the firm, including consumers, suppliers, retailers, and recyclers. Lastly, the
value network stakeholders are those directly or indirectly related to the firm, including the
government, competitors, society, environment, and local communities. While the idea of
internal and value chain stakeholders is common to businesses, the concept of value network
stakeholders, let alone managing and fostering relationships with them, is quite novel
(Bertassini et al., 2021).
The current mindset focuses on the trade-offs of stakeholders’ interests, meaning that the needs
of one stakeholder can only be fulfilled by sacrificing the needs of another. Meanwhile, in
creating value, different stakeholders may have various contributions to the business. Perhaps
the stakeholders that are considered most important are those that can provide access to tangible
resources, but other stakeholders have their own significance in that they have information,
expertise, and insights that would help the business formulate better business strategies.
21
Maintaining close relationships with multiple stakeholders is a core concept in the stakeholder
theory, mainly because by gathering insights and information from them, the company is at
less risk of being locked into old, unsustainable ways of doing business (Freeman, Harrison
and Zyglidopoulos, 2018).
Figure 3 Stakeholder map of the circular business ecosystem
(Bertassini et al., 2021, p. 437)
Concepts within the stakeholder theory could support the innovation process. At the very core
of innovation and entrepreneurial activity, the opportunities that the actors capture and create
highly depend on understanding the gap in which stakeholders’ interests have yet to be fulfilled
(Freeman et al., 2010). By infusing the multi-stakeholder perspective into the innovation
process, businesses will be able to identify the most relevant stakeholders, include their
interests into the business, gather knowledge and insight from them as well as gain acceptance
when the new product/service is rolled out to the public (Freeman, Harrison and Zyglidopoulos,
2018).
Indeed, stakeholder management is an essential aspect within circular business models because
enabling circularity entails a grand transformation of complex systems and requires
multistakeholder collaboration (Bertassini et al., 2021). In a study by Bertassini et al. (2021),
a classification of circular business ecosystem stakeholders, types of circular value
propositions, and the relationship between these stakeholders and the circular captured values
were identified. In addressing the stakeholder management issue in the circular economy topic,
Bertassini et al. (2021) created a guide for mapping stakeholders and capturing circular values
in hopes that organizations will be able to use them to better find and implement circular
strategies.
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3.4. Food packaging
Packaging plays a significant role in the globalization of the food and beverage industry.
Packaging can prolong the freshness and shelf-life of the food, hence reducing food loss and
food waste. Food packaging not only protects and preserves the food for a longer time, but also
makes the food itself easier to handle, transport, store, and distribute to a global market. It also
provides a canvas for communication, providing the necessary product information to
consumers without much hassle (Chakori et al., 2021; Williams and Wikström, 2011). A large
portion of food packaging today is single-use, with about 95% of it becoming waste after just
one-time use. At 35% of the global packaging production, the food industry has become the
source of the largest demand for single-use packaging (Chakori et al., 2021).
Chakori et al. (2021) investigated the system dynamics that contribute to the global
popularization of single-use food packaging. The study focuses on the interaction, feedback,
and reinforcing loops within the household, supermarket, and globalisation subsystems that
eventually show the events and causes behind rising demands in single-use food packaging.
Among the many drivers identified from the perspective of globalization and supermarkets,
some notable drivers include the role of the international market of import and export,
urbanization, and the expansion of the supermarket model providing convenient “one-stop
shopping” centers all over the world. On a more micro-economic scale, looking at the
individual and household level, the cycle basically starts with the growing working population.
When more individuals work outside of the home regularly, their time for cooking on their own
is typically reduced. To compensate for their limited time, demand for high-convenience food
products grows. In most cases, this means ready-made meals packaged in single-use plastic
packaging. The complete diagram given by Chakori et al. (2021) showing the causal
relationships and encompassing the whole system of food packaging use is seen in Figure 4.
Various materials are used as food packaging, namely paper, glass, metals, and plastics. Plastic
is the dominating material in the food packaging sector, with 53% of food products packaged
by plastics (Chakori et al., 2021). The following sections will discuss the different materials
commonly used for food packaging and how they compare to each other in terms of
environmental impact.
23
Figure 4 Mapping of drivers of food packaging use
(Chakori et al., 2021, p. 5)
24
3.4.1. Plastic packaging
Since the 1960s, plastic has taken over the world to replace a number of materials such as
wood, glass, and metals. It has become the superior material to handle various purposes because
of its lightweight, durability, and flexibility, high strength-to-weight ratio, and versatility
(Cottafava et al., 2021; Matthews, Moran and Jaiswal, 2021; World Economic Forum, Ellen
MacArthur Foundation and McKinsey & Company, 2016). Due to the large scale of global
production, and the fact that its raw material is cheap fossil fuel, plastic is also oftentimes the
cheapest alternative compared to its counterparts. In the food and beverage sector, plastic
improves storage, preservation, and distribution (Matthews, Moran and Jaiswal, 2021; Otto et
al., 2021; Stefanini et al., 2021). Its barrier properties make sure that food can be stored safely
without spoiling quickly, therefore prolonging the shelf-life of food products. Its lightweight
properties further make it very easy and inexpensive to transport, enabling food to be
distributed to various regions across the world and providing people with more affordable food
products (Matthews, Moran and Jaiswal, 2021; World Economic Forum, Ellen MacArthur
Foundation and McKinsey & Company, 2016). Their contribution in preventing food loss and
food waste may compensate for a large portion of the environmental impact of food production
itself (Matthews, Moran and Jaiswal, 2021).
There are numerous types of plastic resins used in food packaging. The following lists these
common plastic types and their uses:
• Polypropylene (PP), used for food containers ranging from microwave dishes, ice
cream containers, potato chip bags, and wrappers
• Polyethylene terephthalate (PET), used for beverage bottles, salad and dressing
containers
• High-density polyethylene (HDPE), used for milk and juice bottles
• Expanded polystyrene (EPS), used as foamed drink cups or meat trays, hamburger
clamshell containers (Otto et al., 2021; World Economic Forum, Ellen MacArthur
Foundation and McKinsey & Company, 2016).
But this material does not exist without flaw. Plastics are linked to high greenhouse gas
emissions because they are made of fossil fuel-based chemicals or petrochemicals (Stefanini et
al., 2021). It is primarily used worldwide in various shapes, sizes, colors, and mixture, even
just in the food and beverage sector. And especially for single-use plastic packaging, its short
25
lifetime paired with high production rate leads to tremendous waste. These wastes may end up
in landfills, open dump sites, or even in natural environments such as our oceans and rivers
(Matthews, Moran and Jaiswal, 2021). Meanwhile, about 95% of food packaging are single-
use (Chakori et al., 2021), and plastic products (including those outside of food packaging use)
account for about 6% of oil consumption worldwide (World Economic Forum, Ellen
MacArthur Foundation and McKinsey & Company, 2016).
Plastics are highly recyclable, yet due to technical issues and the low quality and economic
value of its secondary product, recycling of plastics are still at an astonishingly low rate, just
14% globally (Chakori et al., 2021; Matthews, Moran and Jaiswal, 2021; World Economic
Forum, Ellen MacArthur Foundation and McKinsey & Company, 2016). This small number
can be accredited to limitations in the recycling technology and the initial design of the
packaging itself. Most packaging nowadays are lined with multiple layers of different kinds of
plastic polymers to increase protection and overall quality improvement. The mix of these
layers are often times costly or just quite simply difficult to take apart, hence causing trouble
in recycling efforts (Matthews, Moran and Jaiswal, 2021). Furthermore, the secondary products
of recycled plastics currently still cannot achieve the same level of technical nor economic
value as virgin plastics. Therefore it cannot be truly circular in replacing virgin-made plastics
(Geyer, Jambeck and Law, 2017). For this reason, Geyer, Jambeck and Law (2017) state that
recycling only delays disposal; it does not actually prevent the plastics from becoming our
garbage.
Other than environmental impacts, the use of single-use plastics also poses health problems,
such as the leaking of micro-plastics into our food (Stefanini et al., 2021). This is especially a
concern for recycled plastics, as contaminants are more likely to leak into the food when it is
packaged in recycled plastics than with virgin plastics since the food-grade and non-food-grade
plastics are not separated during the recycling process (Matthews, Moran and Jaiswal, 2021).
3.4.2. Paper and cardboard packaging
Paper is another common material used for single-use food packaging. Since paper and
cardboard are made of wood, the production of such products requires large energy
consumption and land use. They are also often combined or coated with plastic or aluminum
to prevent leaking and damage by water or liquids in general. Paper and cardboard easily
degrade in nature after about 2-3 months, but these additional layers make it challenging to
26
biodegrade or even recycled. Nevertheless, paper packaging are still generally perceived as one
of the more sustainable packaging choices when compared to metal and plastics (Otto et al.,
2021).
3.4.3. Bio-based plastic packaging
As a more ecologically friendly alternative to plastic packaging, various types of polymers
derived from biomass have been introduced. Examples of biomass that can be manipulated to
mimic the properties of conventional plastic polymers are cellulose, starch, polylactide acid
(PLA), and poly-beta-hydrocyalkanoates (PHB) (Chakori et al., 2021). Common crops which
can be used to extract such polymers include sugarcane, corn, and cassava (Changwichan and
Gheewala, 2020; Moretti et al., 2021). PLA is more commonly known to be made from corn,
while the material used for food packaging that is based on sugarcane is also known as bagasse
(ecokloud.com, no date).
Bio-based “plastic” packaging has lower greenhouse gas emissions compared to conventional
plastic, at about 20% or 32% if fully recycled. On the other hand, the energy, water, and land
consumption attributed to the cultivation of the raw materials for the bioplastics may actually
show higher environmental footprint than conventional plastics. The difference in the
environmental impact of conventional plastics and bio-based plastics also depends on the end-
of-life treatment. Composting bio-based plastics may generate more greenhouse gas emissions
than the recycling process of conventional fossil-based plastics. Though bio-based plastics are
generally assumed to be biodegradable, oftentimes, they need specific physical conditions
(temperature, light, oxygen content) to facilitate such automatic processes (Chakori et al.,
2021).
3.4.4. Glass packaging
Glass containers are made from sand, soda, ash, and limestone. The manufacturing process
requires that these materials be molten with extreme high temperatures reaching 1600ºC and
then comes into shape by the aid of compressed air. Glass goes through further heating and
cooling processes, which translates to high energy consumption and high global warming
potential impact (Otto et al., 2021).
Glass is highly reusable and recyclable, which helps reduce the environmental footprint linked
to the manufacturing process. In fact, the impacts can be reduced by 40% just from 1 loop of
27
reuse (Stefanini et al., 2021). Unfortunately, the benefits do not increase significantly with the
next couple of reuses; instead, it stabilizes after the 8th cycle. This quick rebound is primarily
accredited to the impacts that arise from the transport of returns and redistribution, as well as
from washing (Stefanini et al., 2021). On a more positive note, glass can be recycled to no end,
as it does not lose its properties after any number of recycling loops (Otto et al., 2021;
Sazdovski, Bala and Fullana-I-Palmer, 2021).
3.4.5. Metal packaging
Aluminum and tinplate are the two most common metals that are used for food packaging.
Both these materials have to be coated or alloyed with steel or plastic to be safe from corrosion
and prevent the leakage of metal ions onto the food it contains. Like plastics, these metals are
easily recyclable, but the different coating and alloys become a barrier to recycling (Otto et al.,
2021). In fact, out of all the beverage packaging products on the market, aluminum cans have
the highest circularity potential since they are the most recycled globally (Sazdovski, Bala and
Fullana-I-Palmer, 2021). Not considering the alloys, these metal materials can generally be
recycled endlessly (Otto et al., 2021). However, virgin production of aluminum is very energy-
intensive (Sazdovski, Bala and Fullana-I-Palmer, 2021).
Other than aluminum and tinplate, stainless steel is another material used to make food
containers or packaging. Steel is durable and heat resistant and can be recycled almost endlessly
without ever degrading its quality (Radu et al., 2020). Their magnetic properties enable easy
separation that foregoes the recycling process (Radu et al., 2020).
3.4.6. Life cycle assessments of food packaging materials
In order to fully understand the difference between all these food packaging materials in terms
of their environmental impact, reviewing or conducting life cycle assessments (LCA) would
be one solution which can provide insight. With an LCA, we can understand the impacts
generated by a system starting from the raw material extraction, to the production, use phase,
end-of-life treatment and disposal phase (cradle-to-grave). The impact categories often
considered in an LCA are global warming potential (GWP), acidification, eutrophication, land
use, ozone depletion, water depletion, resource depletion, photochemical ozone formation,
ecotoxicity, and ionising radiation (European Commission, no date).
28
Two studies worth noting, are the WRAP (2010) and Sazdovski, Bala and Fullana-I-Palmer
(2021) studies. Both provide reviews of LCAs primarily from Europe and North America (with
a few exceptions scattered around Australia, Asia, and South America but not in significant
numbers in Sazdovski, Bala and Fullana-I-Palmer (2021)’s study). While WRAP (2010)
reviewed a range of LCA studies covering beverage packaging and distribution packaging
(crates, boxes, trays), Sazdovski, Bala and Fullana-I-Palmer (2021) did a systematic review of
51 LCAs specifically covering the different materials used for beverage packaging (glass,
aluminium, PET, etc.).
From these two studies, several factors were identified as critical in determining the final
environmental footprint when comparing between single-use and reusable packaging
scenarios:
• Source of raw material and energy used during all stages of the life cycle
• Transportation modes and distance of transport (especially in modeling the return and
redistribution loops for a reusable packaging system)
• Number of trips for the reusable packaging system
• Amount of reusable packaging needed in stock to support the demand and adequate
flow of packaging
• Recycled content of the packaging/containers
• End-of-life waste treatment: recycling methods, composting, etc.
• Impacts linked to the washing and maintenance of the reusable packaging
• Rate of breakage of the reusable material
• Weight of each material needed to fulfill the same function
• Extra packaging required in both the single-use and the reusable systems (Sazdovski,
Bala and Fullana-I-Palmer, 2021; WRAP, 2010).
In accordance to the WRAP (2010) findings, Greenwood et al. (2021) concluded that the
reusable and returnable packaging model will work best with containers that contain some
portion of recycled material in it, can be easily recycled at the end of its lifetime but also durable
enough to withstand a long lifespan in the first place, and that they are stackable so that they
are not too space-consuming during storage and transport.
29
In comparing single-use food or beverage packaging, most LCAs compare between PP, PET,
EPS, PLA or bagasse, paper or cardboard, tin, and aluminum (Changwichan and Gheewala,
2020; Cottafava et al., 2021; Greenwood et al., 2021; Moretti et al., 2021; Otto et al., 2021).
Moretti et al. (2021) conducted a cradle-to-grave LCA to compare PLA, PP, and PET beverage
cups. They found that PLA cups generally have lower environmental impact than PET cups
but not for PP cups. PLA cups consume less fossil-based resources than both PP and PET cups,
but when considering land-use change and waste contaminations, PLA cups only outperform
PET cups when it comes to climate change impact or the GWP. Other impact categories where
PLA was found to be worse than PP and PET are photochemical ozone formation, acidification
and terrestrial eutrophication (Moretti et al., 2021).
Otto et al. (2021) not only compared the GWP of PET, PLA, paper/cardboard cups and glass
beverage containers, but also taking into account reuse or recycled scenarios. In the case of
single-use containers made of virgin materials, their findings show that PLA has slightly
smaller GWP compared to PET, somewhat similar to what Moretti et al. (2021) found. The
impact of PET becomes lower than PLA, however when the PET container is made of recycled
materials (meanwhile, there was no data for recycled PLA). Furthermore, the virgin
paper/cardboard containers have the smallest impact, then in order of increasing impacts,
comes PLA, PET, and glass (Otto et al., 2021).
Changwichan and Gheewala (2020) also conducted an LCA to compare different single-use
plastic cups to a reusable alternative in the context of Thailand. In their case, the single-use
plastic cups considered were of PP, PET and PLA material, whereas the reusable alternative
considered was stainless steel. Looking only at the single-use packaging, the ranking from
lowest to highest impact in the GWP and fossil depletion category is first PLA, then PP, then
PET. In terms of terrestrial acidification impact, the lowest impact goes to PP, followed by
PET and then PLA (though PLA numbers were not significantly higher than PET). For the
human toxicity impact category, PP has the lowest impact, then PLA, and last is PET.
Greenwood et al. (2021) conducted a life cycle assessment of 8 different types of food
packaging in three scenarios: single-use; return model; and refill model. The materials they
compared were EPS, PP, aluminum and bagasse for the single-use containers, then PBT, PP,
and steel tin for the reusable containers. They considered three main impact categories, namely
GWP, land use, and water consumption. In the case of the single-use containers, the GWP
30
impact is the lowest in the bagasse container, then comes EPS, aluminum, and PP (in order of
increasing GWP). The order changes, however, when looking at the other two impact
categories. In both the land use and water consumption impact categories, the material with the
lowest impact is EPS, then comes aluminum, then bagasse, and last is PP.
When comparing reusable food or beverage packaging, the materials typically considered are
glass, stainless steel, and plastics (Changwichan and Gheewala, 2020; Cottafava et al., 2021;
Greenwood et al., 2021; Otto et al., 2021; Stefanini et al., 2021).
Comparisons of glass bottles or beverage packaging are found in Otto et al. (2021) and
Stefanini et al. (2021)’s studies.
In Otto et al. (2021)’s study, glass beverage bottles made of virgin material have the highest
GWP impact compared to PET, PLA, and paper/cardboard. The GWP of glass is seven times
as high as paper/cardboard and almost three times as high as PET and PLA. Glass still has a
higher impact than PET when they are both made of recycled resources. But a significant
difference can be seen in the reuse scenario, where the GWP impact of glass is almost the same
as PET (Otto et al., 2021).
In Stefanini et al. (2021)’s study, glass bottles are compared to PET and 50% recycled PET
bottles; both of the latter are single-use. Generally, if we only consider the production phase of
the packaging itself, glass bottles have worse environmental impact compared to plastics (PET,
HDPE, PP), cardboard, and aluminum. Glass bottles generally take up much more energy to
produce than the mentioned alternatives, and is also linked to higher levels of greenhouse gas
emissions. Reuse and recycling are both viable options that can help reduce the initial
environmental impact of production. However, the portion of the life cycle with the most
significant environmental impact and energy consumption now shifts to the sterilization phase
that is mandatory for the reuse of glass bottles and the melting and formation during recycling
(Stefanini et al., 2021). In all impact categories, glass bottles have much higher impact than
their plastic counterparts. Even if the glass bottles followed a return and reuse scenario (with 8
uses and 7 returns), it still showed higher environmental impacts than the PET and R-PET
bottles in most of the categories except marine litter, fossil resource scarcity and water
consumption, in which the impacts of the returnable glass bottle is nearly the same as that of
the PET bottle for the latter two impact categories. Overall, the main phases that make the glass
bottles less environmentally friendly than the PET and R-PET bottles are the production of the
31
glass bottle itself, secondary and tertiary packaging, and the distribution phase (Stefanini et al.,
2021).
Comparisons of reusable stainless steel packaging/container can be found in Changwichan and
Gheewala (2020) and Greenwood et al. (2021)’s studies.
Changwichan and Gheewala (2020) conducted an LCA to compare different single-use plastic
cups (PP, PET, PLA) to a stainless-steel reusable cup alternative in the context of Thailand.
Their study shows that the stainless-steel cup has lower impacts in all categories except human
toxicity, where the stainless-steel cup could have higher impact than the PP single-use cup
(depending on the method of washing). In their calculation, they assumed that only one
stainless steel cup would be needed to deliver the function of 260 uses over a year; meanwhile,
there would be 260 of each of the single-use alternatives. They also did not assume transport
between the use and washing phase of the stainless steel cups, meaning that the cups are
individually owned by the consumers, not maintained in a reusable-returnable system managed
by a third party (Changwichan and Gheewala, 2020)
Similarly, Greenwood et al. (2021)’s study showed that reusable food containers made of steel
have a significantly lower environmental footprint than their single-use counterparts (EPS, PP,
aluminum, and bagasse) in the GWP impact category, assuming a lifetime of 100-200 uses.
The PBT and PE reusable plastic containers have even lower environmental impact, even with
a lifetime of only 50 uses. However, in the land use and water consumption impact categories,
the EPS single-use food packaging actually has a lower impact when compared to steel. EPS
also performs better than PBT and PE in the land use category, but not in water consumption.
Compared to reusable PBT and PP containers, the steel box requires the highest number of
reuses to break even with the single-use containers’ (EPS, PP, and aluminum) greenhouse gas
emissions. While a steel box needs to be reused about 13-33 times to be at equal slate with
single-use containers, the PBT and PP boxes only need 2-4 reuses. Both are theoretically
doable, as the PBT and PP boxes have a lifetime of 50 uses, and the steel box has a lifetime of
100 or 200 uses. In all three impact categories, the washing phase of the reusable packaging
makes up for the most prominent impact contributor (Greenwood et al., 2021).
Table 3 summarizes the break-even points and lifetime of several reusable packaging materials
compared to single-use packaging.
32
Table 3 Break-even point of climate change impact between reusable and single-use packaging
(Cottafava et al., 2021; Greenwood et al., 2021)
Reusable
packaging
material
Lifetime
(uses)
Number of uses to
break even with
single-use containers
Single-use container being compared Reference
PP cups 8 PP cups Cottafava et
al. (2021) 7 PLA cups
5 PET cups
10 Cardboard cup + PE inner coating
PLA cups 41 PP cups Cottafava et
al. (2021) 35 PLA cups
24 PET cups
54 Cardboard cup + PE inner coating
PET cups 18 PP cups Cottafava et
al. (2021) 16 PLA cups
11 PET cups
23 Cardboard cup + PE inner coating
Glass cups 35 PP cups Cottafava et
al. (2021) 28 PLA cups
17 PET cups
55 Cardboard cup + PE inner coating
PBT bowl 50 4 EPS clamshell Greenwood
et al. (2021) 2 PP microwave tray
3 Aluminium tray
PP box 50 3-4 EPS clamshell Greenwood
et al. (2021) 2 PP microwave tray
2 Aluminium tray
Steel tin box 100 -
200
33 EPS clamshell Greenwood
et al. (2021) 13 PP microwave tray
18 Aluminium tray
One interesting assumption made by Greenwood et al. (2021) in their LCA study, was that the
transport happening between the customer and the point of food takeaway is done on foot,
meaning that there are no transport emissions or any environmental impact accredited to that
step. Hence, for however many loops the return phase is repeated, it has no impact on the
overall ecological footprint. Unfortunately, food delivery and takeaways don’t always occur in
the same scenario, rather there are other modes of transport that utilize fossil fuels. Hence there
should be a considerable global warming impact coming from the back-and-forth transport
routes.
As briefly mentioned above, Greenwood et al. (2021)’s study also compares reusable plastic
containers. Other comparisons of reusable plastic packaging/containers can be found in
Cottafava et al. (2021)’s study. Cottafava et al. (2021) conducted an LCA to compare four
single-use packaging to four reusable packaging of beverage cups, further calculating the
33
break-even point for each reusable cup to outperform the single-use counterparts. The single-
use packaging materials they compared were: 1) PP; 2) PLA; 3) PET; and 4) cardboard with
polyethylene coating. Meanwhile, the reusable packaging included in the study were: 1) PP; 2)
PLA; 3) PET; and 4) glass. They conclude that out of the four alternatives of reusable cup
packaging materials, PP cups have the least environmental footprint, followed by PET (in most
impact categories). This shows that the non-plastic materials still fare worse than their plastic
counterparts even in the reusable scenario. Reusable cups made of PLA and glass have high
environmental impact primarily due to the fact that the average weights of these products are
much higher than PP and PET reusable cups (Cottafava et al., 2021).
An important point about the behavioral aspect of food packaging was made by Greenwood et
al. (2021). They noted that customers might reject the reusable containers as soon as it looks
unappealing, no matter how little it has been reused. Hence, if the container has to be reused 5
times, but its appearance deteriorates significantly after only 2 or 3 uses, then it might not reach
its break-even point due to rejection from the customer’s side. This highlights the importance
of not only the technical viability of the system but also the other attributes attached to it that
meets society’s standard of acceptance (Greenwood et al., 2021).
All of these LCA studies have different assumptions regarding the energy source,
transportation distances, and washing methods for the reusable packaging options. Each study
also considers different impact categories, although all of them at least considers the GWP or
climate change impact. Although these studies don’t always show converging results, but it
can be concluded that some single-use packaging materials, such as paper cups and PP
containers, are still often more eco-friendly than the reusable alternatives.
Another common conclusion from these studies is that reusable containers can be more eco-
friendly than their more dominant single-use counterparts, but only under specific conditions
regarding transportation, energy source, washing, number of reuses, and end-of-life treatment.
Reusable glass packaging is typically still worse (or not much better) than single-use
packaging, while under the right conditions and in specific impact categories, reusable PP or
stainless-steel packaging may be better than the single-use packaging alternatives. This does
not necessarily mean that single-use plastics are the absolute best and most sustainable option
but that the other alternatives may require holistic systemic change in order to become more
sustainable than the current widely used single-use solutions.
34
4. Problem & context definition
Indonesia is one country where plastic pollution is still an immense problem, and which will
be the regional focus of this study. In 2015, Jambeck et al. (2015) listed Indonesia as the
second-largest contributor to marine pollution of plastic waste. This should come to no surprise
as the country has seen pronounced economic growth within the last 20 years (UNDP, no date)–
meaning that the middle class and overall consumption levels are continuously growing -- yet
it is not balanced with a well-functioning waste management system nor sound governance
over environmental matters. In the next subchapters of this report, an overview of the
Indonesian context: its geography, demographics, economy, sustainability challenges, and
efforts regarding single-use waste will be introduced.
4.1. Indonesia: an overview
In the following section, an overview highlighting Indonesia’s main geographic and socio-
economic conditions will be presented.
4.1.1. Geography
Indonesia is an archipelago country in Southeast Asia that stretches along the Equator for about
5100 km from east to west and about 1800 km from north to south. It is situated between
mainland Asia and Australia, naturally standing at crossroads of both trade and cultural
exchange. From the land; characterised with mountainous islands with more than 100 active
volcanoes, coastal plains, dense tropical rain forests, mangrove swamps; to the seas filled with
deep sea trenches and coral reefs, Indonesia is home to diverse flora and fauna. It has
approximately 40,000 species of flowering plants, more than 3,000 tree species, thousands of
fish species, and many endemic animals such as the Komodo dragon, orangutan, and single-
horned Javan rhinoceroses (Legge et al., 2021). Indonesia is made up of over 17,500 islands
(Legge et al., 2021). It can be divided into five major island groups, namely Sumatra, Java-
Bali, Borneo (Kalimantan), Celebes (Sulawesi), and the eastern islands.
35
Figure 5 Map of Indonesia
(Furian, 2021)
4.1.2. Demographics
Indonesia consists of approximately 250 million inhabitants, making it the 4th most populous
country in the world (Ministry of Environment and Forestry, 2020). Indonesia consists of over
300 ethnic groups and even more local languages and dialects (Legge et al., 2021).
Nevertheless, Bahasa Indonesia is the official national language, though it may not always be
the mother tongue for all Indonesians. Most of the world’s largest religions are practiced in
Indonesia, i.e., Islam (being the majority), Christian, Hindu, Buddha, alongside many other
indigenous religions (Legge et al., 2021).
The population is relatively young, with 41% of the population under 25 and 85% under 65
(Deloitte, 2020). The Baby Boomers, Gen X, and Gen Y are the most influential groups that
would contribute to economic growth. Gen Y is the most dominant of the three, born in 1980-
2001. These individuals are the most tech-savvy, active users of the Internet and social media.
Viewing the population as the consumer class, the typical characteristics of the Indonesian
consumer are: late adopters of new technology, avoids risks, and also very family-oriented
(Prayoga Kasmo, Wahid and Ismail, 2015).
The capital, Jakarta, is located on Indonesia’s most populous island, Java. Approximately 60%
of the nation’s population inhabits the Java island (Embassy of Indonesia Washington D.C.,
2017), though the area only accounts for 7% of Indonesia’s total landmass (Encyclopaedia
36
Britannica, 2021). Urbanization is also quite high in Indonesia, with about 71% of the
population expected to shift to urban areas by 2030 (Prayoga Kasmo, Wahid and Ismail, 2015).
4.1.3. Economy
Within the period of 1975-2004, Indonesian GDP growth was an average of 5.6% per year
(Hill, Resosudarmo and Vidyattama, 2008). Before the outbreak of the Covid-19 pandemic, its
economic growth progressed consistently, thus bumping its status to upper-middle income in
2020 (The World Bank, 2021). Along with the rapid economic growth, the country was also
able to reduce poverty from 24% in 1997-1998 (when the financial crisis hit Asia) to just 11%
in 2014. Consequently, Indonesia's middle class and consumer class continues to grow larger,
at about 10% annually since 2002 (The World Bank, 2015).
The main industries driving the Indonesian economy are oil, gas, mining, agriculture, and
forestry, though the service sector is also growing. The capital, Jakarta, is the center of high-
value services and the only region consistently growing wealthier than the rest of Indonesia
(Hill, Resosudarmo and Vidyattama, 2008). In 2004, Jakarta alone contributed to 1/6 of the
country’s GDP. Jakarta itself serves as a center of business and government, and it has long
been where people from all over Indonesia migrate to seek better socio-economic opportunities
(Hill, Resosudarmo and Vidyattama, 2008). Nowadays, Jakarta is notorious for overcrowding,
horrible traffic, and floods, which are three of many other reasons for the government’s plan to
move Indonesia’s capital to the island of Borneo (Eliraz, 2020).
Other than Jakarta, Bali is another region in Indonesia that has shown rapid economic growth,
primarily due to the fact that Bali is Indonesia’s leading tourism center. The success of Jakarta
and Bali may be accredited to one common trait: their openness and connection to the
international community and market (Hill, Resosudarmo and Vidyattama, 2008).
With rapid economic growth comes a stronger middle class, with a shift of consumer preference
towards higher quality products and services, emphasizing health and wellness, as well as the
booming popularity of e-commerce and digital payments. Indeed, digitalization is proving to
be an essential factor to the outlook of the Indonesian economy. In fact, Indonesia is home to
5 out of 9 Southeast Asian unicorn technology start-ups (Deloitte, 2020). Two standout
technology startups are Go-Jek and Grab, which started out providing ride-hailing services.
Now they have expanded to become Super Apps, providing a wide range of services such as
37
food delivery, last-mile delivery for packages, and digital payment solutions, to name a few
(Deloitte, 2020).
4.1.4. Inequality
Though the economy is budding with potential, inequality is an immense issue in Indonesia.
While poverty was significantly reduced, inequality only continued to grow after the crisis of
1997-1998. In fact, 20% of Indonesia’s wealthiest comprise about 49% of national household
consumption in 2015. Some of the leading causes of the ever-increasing inequality lie in the
lack of equal opportunity (also related to access to education, health, infrastructure), a large
gap between the high-skilled and low-skilled labor, and corruption. Furthermore, prolonged
inequality will bring detrimental effects to the country, namely decreasing trust in public
authorities, social conflicts, and inhibiting economic growth in the long run (The World Bank,
2015).
Inequalities between regions are also quite evident. Jakarta and East Borneo are the wealthiest
provinces, with non-mining Gross Regional Product (GRP) at least three times the national
average. While Bali, West and East Java, North Sumatra, and West Sumatra are less than the
national average but still close, about 85%. However, the eastern islands have half or less than
the national average (Hill, Resosudarmo and Vidyattama, 2008).
4.2. Sustainable consumption and production in Indonesia
Before the circular economy became an emerging issue around the world, the 12th Sustainable
Development Goal, sustainable consumption and production, had already been put into plan
and action in Indonesia since the UN SDGs had been launched in 2015 (United Nations, no
date). Even before then, Indonesia’s National Development Planning Agency presented the
indicators, existing regulations, and action plan towards sustainable consumption and
production in the 2011 Asia Pacific Roundtable for Sustainable Consumption and Production.
There were four main indicators:
• Resource use and waste (non-mineral, municipal, and hazardous waste generation;
domestic material consumption, emissions of SOx, NOx, and methane)
• Consumption patterns (energy, electricity, and food consumption)
38
• Production patterns (ecolabel licenses, areas under agri-environmental and organic
farming commitments, livestock density index, organizations and sites registered with
EMAS)
• Contextual indicators (household consumption) (Murniningtyas, 2011)
Murniningtyas (2011) also highlighted that Indonesia already had several regulations since
1990 that support the sustainable consumption and production agenda. The summary of
relevant laws presented by Murniningtyas (2011) is given in Table 4.
Table 4 List of Indonesian laws regarding sustainable consumption and production
(Murniningtyas, 2011, p. 12)
No.
Sustainable
Consumption and
Production Cycle
Categories
Act No.
5/1990 on
Biodiversity
and
ecosystem
Act No.
32/2009 on
Environmental
management
Act No.
7/2004 on
Water
resources
Act No.
18/2008 on
Waste
management
Act No.
30/2007
on Energy
Act No.
22/2009 on
Transportation
1 Sustainable resource
management
✓ ✓ ✓ ✓ ✓ ✓
2 Design for
sustainability
✓ ✓ ✓ ✓ ✓ ✓
3 Cleaner production
and resource
efficiency
✓ ✓ ✓ ✓ ✓ ✓
4 Sustainable
transport
✓ ✓
5 Eco-labelling and
certification
✓ ✓ ✓ ✓
6 Sustainable
procurement
✓ ✓ ✓
7 Sustainable
marketing
✓ ✓ ✓ ✓ ✓
8 Sustainable
lifestyles
✓ ✓ ✓ ✓ ✓ ✓
9 Waste management ✓ ✓ ✓ ✓ ✓
Furthermore, as an umbrella regulation to address the SDGs as a whole, the President of the
Republic of Indonesia published a presidential decree in 2017 that outlines the necessary
indicators for implementing the SDGs in Indonesia. According to the appendix of this
Presidential Decree, the national target actions linked to the 12th SDG mainly focus on:
• collaborations and programs to promote sustainable consumption and production
• improving hazardous waste management
• improving waste management following the 3R (reduce, reuse, recycle) concept
• encouraging companies to be ISO 14001 (environmental management) certified
39
• development of eco-friendly products and green public procurement (Presidential
Decree No. 59/2017 concerning the implementation of the sustainable development
goals 2017)
4.3. Circular economy in Indonesia
As of late, there is no official regulatory document in Indonesia that is dedicated to the circular
economy just yet, but there are programs and action plans developed by the public and private
sector alike that are in line with the circular economy agenda. These initiatives mainly focus
on waste management and building circular economy stakeholder networks (Bahraini, 2018)
and extended producer responsibility or EPR (Ratnawati, 2018).
In 2019, the Ministry of Environment and Forestry published a decree which officially governs
the EPR scheme (Decree No. P.75/MENLHK/SETJEN/KUM NUMBER.1/10/2019 concerning
road map of waste reduction by producer 2019). This decree mandates that local governments
give incentives and/or disincentives for producers in order to encourage them to reduce their
waste, and that producers report their waste reduction plan and progress to the relevant
government agency in a routine manner. In this document, “producers” were defined as actors
that do business in manufacturing services (the food and beverage industry, consumer goods,
personal care products), the food and beverage service sector (restaurants, cafes, catering
services, hotels), and retail (shopping centres, markets), hence it does not only include large
industries but also smaller businesses (Decree No. P.75/MENLHK/SETJEN/KUM
NUMBER.1/10/2019 concerning road map of waste reduction by producer 2019).
This decree concerning the EPR scheme is still in its early stages of implementation. Between
now and 2022, the Ministry of Environment and Forestry expects to receive the producers’
waste reduction plan. Afterward, the waste reduction activities will start rolling out in 2023.
The document also lists examples of waste reduction actions, primarily focusing on the 3R
concept (reduce, reuse and recycle) that each producer category can do. For instance, in the
food and beverage service sector, the activities listed focus only on the use of bags, plates,
cups, and utensils that are either recyclable, biodegradable, or reusable. Likewise, for the
manufacture industry and retail sector, the list of activities mainly cover material substitution,
and recycling (Decree No. P.75/MENLHK/SETJEN/KUM NUMBER.1/10/2019 concerning
road map of waste reduction by producer 2019). No mention of other business model
innovations was found in the document.
40
Aside from the launch of the EPR decree, the National Development Planning Agency along
with the Embassy of Denmark and UNDP did a study on Indonesia’s circular economy
potential in 2020. From the joint study, they identified five sectors that had the most potential
for circular economy. These sectors (food and beverage, textiles, construction, wholesale and
retail trade, and electronics) constitute 1/3 of the country’s GDP and employment numbers.
These sectors are also found to have tremendous waste now or projected to have a significant
increase in 2030 (National Development Planning Agency, Embassy of Denmark Jakarta and
UNDP, 2021).
According to that same study, plastic packaging waste is mainly accredited to the wholesale
and retail trade sector, with an estimated 5.4 million tons of plastic packaging waste in 2019.
Although that only constitutes 5.6% of the total waste generated by the five focus sectors, the
wholesale and retail trade sector has the highest contribution to the total GDP contribution
compared to the other sectors, namely at 10.7% of the total national GDP or 32% of the GDP
accumulative contribution of the five focus sectors. The wholesale and retail sector also
employs the most people at 15.4% of the national total or 45% of the five focus sectors. This
sector also shows the second-highest potential for waste reduction under the circular economy
framework, precisely at 38% (National Development Planning Agency, Embassy of Denmark
Jakarta and UNDP, 2021). The study categorized circular economy opportunities into the 5R
approach; reduce, reuse, recycle, refurbish and renew. For the wholesale and retail trade sector,
the circular economy approaches identified are:
• Reduce plastic packaging
• Reuse plastic packaging
• Redesign plastic packaging for recycling
• Increase recycling rate
• Substitute with more sustainable materials (National Development Planning Agency,
Embassy of Denmark Jakarta and UNDP, 2021).
The study also shows that with circular economy, there is a potential for the creation of more
than 4 million jobs, an increase of GDP by USD 42 billion or 2.3% of the GDP, and 9%
greenhouse gas emission reduction in reference to the estimated number for 2030. These results
will serve as the first in a 5-phase plan for the national circular economy roadmap, which is
expected to reach full implementation by 2029 (National Development Planning Agency,
Embassy of Denmark Jakarta and UNDP, 2021).
41
4.4. Indonesia’s single-use plastic waste problem
Indonesia generated about 6.8-9.2 million tons of plastic waste in 2017. That makes up of
roughly 15% of the total Indonesian municipal solid waste generation. Of that number, only
30% are well-managed (properly managed disposal and recycled), 60% are left to dumpsites
and open burning, and the remaining 10% leaks into the ocean, lakes, and rivers. Government
regulations have been made to eliminate all open dumpsites by 2013, and yet about 167 of them
were still found in 2018 (Ministry of Environment and Forestry, 2020). Moreover, Indonesia
was reported to have been the second-largest plastic polluter to the ocean, with 3.22 million
tons of plastic waste produced annually in 2015 (Jambeck et al., 2015) and an estimated 0.27-
0.59 million tons of plastic waste entering the Indonesian ocean in 2018 (Ministry of
Environment and Forestry, 2020). Meanwhile, the rate of recycling for plastics in Indonesia is
only 7%. If there are no reductions in current production and no improvements in waste
management, about 12,000 million tons of plastic waste can be expected to end up in landfills
or the environment by 2050 (Ministry of Environment and Forestry, 2020).
Waste management in Indonesia also relies heavily on the informal sector. The collection rate
of plastic waste is 31% by the formal sector and 8% by the informal sector. Furthermore,
scavengers and waste pickers collect about 26% of plastic waste that ends up in those landfills
(Ministry of Environment and Forestry, 2020). Though they contribute significantly to the
waste management system, they are certainly not getting enough pay for their time and energy.
They also work under bad conditions and give little to no regard towards health or safety
procedures (Bahagijo, 2020). On the government’s side, relying on the informal sector is also
a disadvantage in the long run, as they don’t have complete control over the actions of the
workers and that it would be more challenging to monitor and gather necessary data from them.
Further worsening the outlook is the issue of ever-increasing consumption. As a consequence
of higher income and a stronger middle class, consumption rates in Indonesia have also
increased. In 2018, the total household consumption expenditure was 5.08% higher than that
of 2017. When comparing data from 1978, 1998, and 2018, the percentage of monthly
individual spending of non-food items increased, but it decreased for food items. Yet of the
three categories listed under food items (raw food and drinks, staple foods, and ready-made
meals), the ready-made meals increased significantly from almost 10% in 1998 to about 20%
in 2018, while the other two categories decreased in percentage. This data applies only for
urban areas, but similar trends can be seen for rural areas as well (Valenta, 2019).
42
When highlighting the issue of plastic waste, giving attention to food and beverage
consumption is relevant because the food and beverage sector is a dominant plastic user,
accounting for 60% of national plastic production (Ministry of Environment and Forestry,
2020). Lately, there has been a shift in the trend for food consumption, where Indonesians are
more likely to buy ready-made meals. App-based food delivery services, like GoFood by Gojek
and GrabFood by Grab, are gladly taking advantage of this new trend (Valenta, 2019). Even
more so, food delivery services have risen by 47% during the Covid-19 pandemic, leading to
increase in single-use plastic and food packaging waste (Al Faqir, 2021).
Geyer, Jambeck and Law (2017) mentioned that the outstanding growth of plastic consumption
was largely due to the global behavior shift from reusable containers to single-use ones. Indeed,
before plastics became popular, reusable food containers made of metal (aluminum) were
largely used, either in the military, for catering services, or just daily lunches. They were oval
and were stacked in 2 or 3-tiers. They were most likely first used in India (known as “dabbas”
or “dabbawalas”), then further spread to Singapore, Indonesia (known as “rantang”), Malaysia
(known as “mangkuk datar”), and other Asian countries. Within the Southeast Asia region,
these stackable food containers became popular in the 1950s. Meanwhile, in Germany (known
as “henkelmann”) they were used mostly until the 1960s (CNN, 2020). Due to their reusable
nature, they are assumed to be more sustainable than the single-use, disposal packaging that
the modern world is familiar with.
Dabbawalas are an integral part of Indian culture. This century-old traditional catering service
would provide lunches on a daily basis, delivered in tiffin carriers to offices or homes. But
nowadays, they are losing customers to modern food delivery businesses which offer faster
service. In order to save this tradition, a technology-based initiative was introduced in 2015 to
combine technology-based business models with the dabbawala heritage (Chakraborty and
Hargude, 2015).
Other than tiffin carriers, a variety of natural food packaging from fruits and trees are used all
across Indonesia. These include banana leaves, coconut leaves, guava leaves, teak leaves, and
bamboo (Kasmana and Maulina, 2015). They are used directly without any processing (except
for bamboo-based baskets, which need to be weaved). Cultural values are well embedded into
each type of packaging material, as well as how they are folded or wrapped around the food.
They symbolize the people’s closeness to nature.
43
Moreover, they give off distinct aromas to the food itself, empowering the taste (Kasmana and
Maulina, 2015). Though natural food packaging materials have superior traits regarding taste,
ecological impact, and health (Kasmana and Maulina, 2015), they tend to be replaced with
modern plastic and paper packaging for convenience and durability reasons. In some cases,
plastic packaging can also withstand grease and liquids (which are also very distinctive of
Indonesian foods) better than the traditional packaging.
To combat this problem, the government has introduced programs such as implementing
community-based 3R practices through facilitation of waste banks, restrictions on single-
plastic use or “Plastic Bans”, and in general strengthening of municipal waste management
performance (Ministry of Environment and Forestry, 2020). Bans on single-use plastic bags
have slowly started since 2015 in a few selected cities, namely Banjarmasin, Balikpapan, Bogor
and Bali (Alliance of Zero Waste Indonesia, 2019), then also in the capital city (Jakarta) in July
2020 (Asprihanto, 2020). Multi-stakeholder collaborations and campaigns for recycling and
reducing single-use plastics have been carried out by companies such as Unilever and rival
super app companies Gojek and Grab. NGOs such as PlastikDetox, Zero Waste Alliance
Indonesia, and Divers Clean Action are also actively campaigning for that same cause. Yet,
single-use plastics are still largely used to this day, especially in small and medium-sized
enterprises (SMEs) and street food sellers.
44
5. Methodology
In order to answer the three research questions stated in the previous section, the study is
structured into seven steps. The study starts with a preliminary or background literature review
on research methods, basic concepts of the circular economy, circular business models, the
stakeholder theory, food packaging materials, and how they compare to each other in life cycle
assessments.
The second step is designing the method of research: defining the objectives and research
questions, and after deciding on a qualitative study, further defining the methods for data
collection and analysis, and also what kind of empirical work to conduct. The methods decided
for data collection are: 1) desk-based research to answer research question 1; 2) focus group
discussions and interviews to answer research questions 2 and 3. Meanwhile, the method of
analysis decided is qualitative content analysis to conclude on the findings for research
questions 2 and 3.
The third step is conducting desk-based research to find information on existing circular
business models in the food service sector (restaurants, food takeaway, and delivery),
specifically regarding the food packaging used. The type of circular business model found was
mostly of the “reuse” approach. Hence the focus of the study will be business models for
reusable and returnable food packaging.
The fourth step is preparing for the empirical work chosen: focus group discussion and semi-
structured interview. This entails writing a detailed script for the discussion and interview,
doing pre-tests to gather feedback pre-execution, compiling a list of potential respondents, and
arranging each group discussion and interview schedule. Most of the discussions and
interviews would be conducted through online video conference media due to restrictions in
the Covid-19 pandemic, except for those individuals or stakeholder groups that cannot be
contacted electronically. This means that visual media in the form of a presentation was also
prepared to execute discussions and interviews, mainly to help guide the interaction.
The fifth step is conducting the empirical work. Focus group discussions were the primary
method chosen to gather better information from the respondents by having them interact and
build upon each other’s answers. However, semi-structured interviews were done in place of
the focus group discussions for the stakeholder groups whom it was inconvenient and difficult
45
to arrange a group session. More detail on how the discussions and interviews were conducted
will follow in the following sections.
Figure 6 Diagram of the research process
46
The sixth step is analyzing the data. Since the study is qualitative, data analysis will follow the
qualitative content analysis as described by Mayring (2014) following a hybrid of deductive
and inductive approaches. It was then analyzed using the MAXQDA software. Elaboration on
the methods and code words used in this analysis will be given in the following sections.
The seventh and last step is concluding on the findings. This entails reflection on the results
and further identifying implications for further research or practice. The following sections will
explain the methods in more detail, especially regarding the desk-based research, empirical
work, and content analysis. For a summary, the overall research flow is illustrated in a diagram
in Figure 6.
5.1. Desk-based research
Finding the answers to the first research question is done through literature review and desk-
based research. Since the topic of circular business models in the food service and food
packaging sector are relatively new, both scientific articles and grey literature will be
considered valid references in this part of the study. Scientific articles were found through
Scopus, using the keywords “circular economy”, “circular business”, “food packaging”, “food
container”, “returnable”, “reusable”, and/or “take-back” arranged in different orders. The
scientific literature found mostly focus on take-back models in other industries such as
electronics (Botelho et al., 2016; Chen, Kucukyazici and Saenz, 2019) and concrete or
construction (Ramsheva, Moalem and Milios, 2020; Shooshtarian et al., 2021) and logistic
distribution (Kroon and Vrijens, 1995). Other literature found covered LCAs on food
packaging materials, some of which did consider the scenario for reusable and returnable
packaging (Changwichan and Gheewala, 2020; Cottafava et al., 2021; Greenwood et al., 2021;
Otto et al., 2021; Stefanini et al., 2021; WRAP, 2010). Some of these scientific articles also
referred to grey literature which covered reuse & return or deposit systems for food and/or
beverage, both in a particular regional scope (Zero Waste Europe, 2018) and globally (CM
Consulting and Reloop, 2016; Ellen MacArthur Foundation, 2019). Further research was done
to find more business cases that might not be mentioned in the literature found previously,
though only through the Google search engine, with keywords such as “reusable returnable
food packaging” and “reusable food container system”.
This desk-based research aims to understand the different strategies of reuse & return and
reusable models for packaging in food services that currently exist, and to gather initial
47
information on the advantages and disadvantages, as well as the success and failures of these
strategies. This research, backed up with the background literature review done beforehand,
provided the basis for content analysis to answer the second and third research questions.
5.2. Empirical study
After the desk-based research comes the preparation of empirical work. In this part of the study,
empirical data will be collected through online or offline focus group discussions and
interviews, depending on the respondent’s availability. Focus groups are seen as ideal not only
because it gains insight from a group of people at same time, but it also serves the purpose of
initiating discussions and interactions amongst the participants (Gray, 2018). The following
sections will elaborate on the stakeholder and respondent selection as well as the
discussion/interview guidelines.
5.2.1. Stakeholder and respondent selection
First and foremost, the geographical scope of the study had to be defined. In this research study,
two regions were selected: Jakarta (the capital of Indonesia) and Bali. These two provinces
were chosen as they were identified as two of the fastest-growing regional economies in
Indonesia. They have high exposure and connection to the global network and market. They
are both cultural crossroads and home to diverse groups, yet still quite distinct from one
another. Jakarta is Indonesia’s main business and government centrum, attracting citizens from
all over the country to better economic opportunities (Hill, Resosudarmo and Vidyattama,
2008). For that reason, Jakarta itself is a cultural soup of diverse ethnic and religious groups
(though still dominated by Javanese and Muslims).
Meanwhile, Bali is known as Indonesia’s leading tourism magnet, where culture and ancient
traditions have shaped the province’s unique character. Unlike most parts of Indonesia,
Hinduism is the dominant religion in Bali (Hindus only account for 2% of the population)
(Legge et al., 2021). The region is famous for its beaches and spiritual atmosphere
(lonelyplanet.com, no date), and attracts foreign tourists from all over the world. Foreign
visitors and expats have “westernized the island” but on the other hand “Bali has not
succumbed to this trend completely… proudly protecting and keeping its culture, tradition, and
its indefinable Balinese atmosphere” (Cekindo.com, no date).
48
Other than being culturally diverse in their own ways, Jakarta and Bali were two of the first
regions in Indonesia to implement a Plastic Ban regulation (Alliance of Zero Waste Indonesia,
2019; Asprihanto, 2020). For those reasons, these two regions were assumed to be suitable for
new sustainability-oriented initiatives hence also ideal for the scope of this study.
Figure 7 Geographical scope of the study
Graphic content created through Canva (no date)
After defining the geographical scope, stakeholder mapping was done. These stakeholders were
identified from the writer’s own conceptualization, taking away from findings of the desk-
based research and following the mainstream theory and examples of each stakeholder category
by Freeman, Harrison and Zyglidopoulos (2018) and Bertassini et al. (2021). The stakeholders
identified were:
• Internal stakeholders or the firm
o Company management (who supplies and manages the reusable and returnable
system), in this case, an individual business in itself
• Primary or value chain stakeholders
o Food delivery couriers
o Food delivery platforms
o Consumers
o Restaurants
o Food packaging suppliers
• Secondary or value network stakeholders
49
o Government
o Non-governmental (environmental) organizations
o Universities/experts in sustainability or circular economy
Here, the central entity “the firm” refers to a hypothetical actor/organization which provides
the reusable packaging to be used by retailers/restaurants for their delivery orders and manages
the circular system by connecting the relevant value chain actors as well as managing the
returns, redistributions, repairs, etc. It was also assumed that “the firm” is well integrated with
existing food delivery platforms, hence providing an easier way for respondents to imagine
how the system works.
The sampling of respondents was done with non-probability methods, utilizing a mix of
convenience, purposive, and snowball sampling. Convenience sampling is when the researcher
recruits whoever is easily accessible to be his/her respondent. Purposive sampling is when the
researcher has a set of specific criteria to select among potential respondents. Meanwhile,
snowball sampling is when the researcher recruits one eligible respondent and then further asks
them to recommend another potential respondent (Easterby-Smith et al., 2019).
Within the internal stakeholder group, convenience sampling was done for both stakeholder
groups. Contacts in company management offices (Gojek and Grab) were based on personal
network, browsing through company webpage, and through acquaintance of acquaintance, yet
none were available to participate in an interview during the period of data collection. As for
the food delivery couriers, the first ones found on the streets and willing to give their time were
chosen as respondents. The only criteria to be met was that they are couriers who deliver on
motorbikes and are affiliated with mobility giants Gojek or Grab (two technology-based
companies who provide a wide range of services: mobility and ride-hailing, food delivery,
package delivery, even financial services), which can easily be seen from their uniform. No
other specific criteria were set for this group. Hence the sampling resembled more of the
convenience sampling.
In the primary or value chain stakeholder group, consumers were selected based on purposive
sampling. First and foremost, their place of residents had to be in Jakarta or Bali. And they had
to be within the age group of 20-41 years old. This age group was chosen because in a study
by Prayoga Kasmo, Wahid and Ismail (2015) the most dominant consumer group in Indonesia
are those belonging to the Generation Y category, which are individuals born between 1980 –
50
2001, or those currently between 20-41 years old. Snowball sampling was also used in selecting
consumers to gather a group of mixed gender and age. Restaurants were also chosen through
purposive sampling. Other than following the geographical scope (Jakarta or Bali), the other
criterion was that the restaurant serves full meals or snacks, not just beverages, because this
study focuses on food packaging in general, not just beverage containers. Another criterion was
that they are registered and familiar with food delivery partnerships with the aforementioned
online mobility companies Gojek and/or Grab.
In the secondary or value network stakeholder group, the method of sampling used was
convenience sampling. Whichever government officials, NGOs, and sustainability experts had
some affiliation and were in the researcher’s network were contacted. Of course, the
government officials targeted were those in the Ministry of Environment and Forestry. The
NGOs contacted were those who promote or work with fighting plastic pollution and/or
sustainable business practices. The criterion for the sustainability expert is just that he/she has
a formal certification as a sustainability expert or professional. But other than those criteria,
convenience sampling was used. No government officials were available during the data
collection period, so there were no representations for that group.
As for the existing business case(s), convenience sampling was used, with just one criterion:
that it is a business or start-up with a similar business model of reusable and returnable food or
beverage containers, preferably in Indonesia. The only relevant start-up in Indonesia known by
the researcher, CupKita agreed to participate in this study. Other start-ups in Singapore
(Muuse) and Germany (RECUP) were contacted, but there was either no response on the query
or they were not available during the period of data collection.
Hence the stakeholders involved in these focus group discussions and interviews were: 1)
consumers; 2) restaurant/café owners; 3) food-delivery couriers; 4) NGOs related to
environmental/zero-waste campaigns; 5) local sustainability experts; and 6) existing
business/start-ups with a similar business model in Indonesia. An illustration of the stakeholder
mapping is given in Figure 8, where the highlighted text indicates the stakeholder groups with
representation in this study. Meanwhile, the detailed list of actual respondents is shown in
Table 5.
51
Figure 8 Initial stakeholder mapping
Conceptualized by the researcher herself based on Freeman, Harrison and Zyglidopoulos (2018) and Bertassini
et al. (2021). Graphic content created through Canva (no date)
Table 5 List of respondents
No. Respondent Region
Data
collection
method*
Description
I. COURIERS:
1 Courier 1 Jakarta FGD Food delivery courier
2 Courier 2 Jakarta FGD Food delivery courier
3 Courier 3 Jakarta FGD Food delivery courier
4 Courier 4 Jakarta I Food delivery courier
5 Courier 5 Jakarta I Food delivery courier
II. RESTAURANTS:
1 Tangerine
Kitchen
Jakarta I Family-owned business, serves pasta and Japanese rice
bowls, as well as a range of desserts
2 Nyapii Jakarta I Franchise, serves “se’i sapi”, smoked and seasoned beef,
an authentic dish of East Nusa Tenggara, Indonesia
3 Teensy Canteen Jakarta I Serves Asian rice bowl meals and popular beverages
4 Bali Buda Bali I Serves healthy foods, a variety of vegetarian/vegan
options and sells organic produce. Known for their
unique eco-friendly packaging (using glass jars and
degradable materials)
5 Warung Kecil Bali I Serves a mix of traditional dishes as well as western-style
breakfast, sandwiches and salads.
6 Afterwork Bali I Serves mainly pizza, burgers, pasta, grilled meat
7 Manggis Bali I Vegan restaurant, serves a mix of international,
Asian/Indonesian-fusion dishes
52
No. Respondent Region
Data
collection
method*
Description
8 SABO Bali I Family-owned business, serves traditional chicken and
pork satay
9 Dapoer Papa Bali I Serves a wide range of coffee, American, Italian and
Indonesian dishes
10 Dapur Deli Bali I Serves western-style dishes: pasta, salads, sandwiches,
smoothies. Also sells bulk groceries
III. CONSUMERS:
1 Rizky Aji
Pratama
Jakarta FGD Male, age 26
2 Maudy Amira
Salsabila
Jakarta FGD Female, age 26
3 Sri Pascarini
Agustina
Tampubolon
Jakarta FGD Female, age 26
4 Febri Listiawan Jakarta FGD Male, age 21
5 Diah Setyo Jakarta FGD Female, age 33
6 Ni Made Dinda
Mentari
Bali FGD Female, age 24
7 Raditya Halim
Viriyanatha
Bali FGD Male, age 24
8 Made Asta
Yogantara
Bali FGD Male, age 26
9 Sanny Stevin Bali FGD Female, age 34
10 Putu Inda Pratiwi Bali FGD Female, age 25
IV. NON-PROFIT ENVIRONMENTAL ORGANIZATIONS:
1 Greeneration
Foundation
Jakarta I Focus on waste management issues, and behavior
change towards sustainable consumption and
production in Indonesia (Greeneration Foundation,
2021)
2 PlastikDetox Bali I Campaigns for the reduction of plastic use in small
businesses in Bali through networking and rewarding
these businesses (PlastikDetox, 2021)
V. SUSTAINABILITY EXPERT:
1 Maria Dian
Nurani
Indonesia I Certified sustainability professional by the International
Society of Sustainability Professionals
VI. EXISTING BUSINESS CASES:
1 CupKita Jakarta I App-based business that provides reusable and
returnable coffee cups to cafes, a start-up developed in
partnership between Enviu (a Netherlands-based impact
venture in Indonesia) and Muuse (a company in
Singapore providing reusable and returnable food
containers) (CupKita, 2021; Enviu, 2016; Muuse, 2020a,
2020b)
*I = interview; FGD = focus group discussion
53
5.2.2. Interview/focus group discussion guideline
The focus group discussions aimed to answer the research questions over the course of a 60-
to 90-minute session with 5 participants (plus 1 moderator) in each group. All focus group
discussions were moderated by the researcher herself. Meanwhile, the individual interviews
were conducted in 45-60 minutes sessions, mostly conducted by the researcher herself as well.
Besides Manggis and SABO, the remaining 5 Bali restaurants were conducted by a colleague
in Bali due to a collaboration with Catalyze (a communications consultancy firm focusing on
sustainability and behavior change issues based in Bali) and PlastikDetox, the latter being one
of the NGOs who were interviewed for this study. These five restaurants are members of the
PlastikDetox network; hence they represent a group of restaurants that are generally more
environmentally conscious than the average restaurant in Indonesia. Some of these interviews
extended to 90 minutes when the respondents felt more engaged and had more thoughts to
share.
Each focus group represented only one of the stakeholder groups in order to avoid confusion
and collision or dominance of one stakeholder group over the other. However, arranging a joint
discussion session for some stakeholder groups was difficult, specifically for restaurant owners
and NGOs, hence for these two stakeholder groups, individual, semi-structured interviews were
conducted. There was also only one local sustainability expert and start-up with a similar
business model in Indonesia that could be contacted. Hence individual interviews were done
with these two as well. The only stakeholder groups to have gone through focus group
discussions were consumers and food delivery couriers. But in practice, it was quite difficult
to get consent from food delivery couriers to do the discussions (as they are on standby for
orders all throughout the day). So, in reality, data was collected through a shortened version of
the discussion in groups of random numbers, three people, two people, or even just one person,
as this was done spontaneously on the streets in Indonesia and not pre-arranged. They were
also quite reluctant even to give the interviewer their name. Some did not give consent to a
recording of the interview because of presumed affiliation to the company (they felt quite
threatened that their “complaints” will jeopardize their employment).
Both the group discussions and interviews were semi-structured. In each session, a diagram
showing how the circular business model works was presented (see Figure 9). A set of
questions was formulated to grasp the stakeholder’s insight into food packaging use and how
they felt about a different scenario with reusable and returnable containers compared to the
54
mainstream single-use packaging. There were major questions that were common to all
stakeholder groups, such as: “what are your impressions regarding a reusable-returnable
model?” and “what do you think the barriers for such a model are?”. But some questions were
retrofitted to the type of stakeholder. For instance, only the restaurant owners were asked about
the hygiene standards that they applied at their restaurant, what kind of material they used for
their takeaway and delivery packaging, and the material they would prefer for a reusable-
returnable model and the reason for their choices. The entire introduction script and list of
questions are given in Appendix A.
All of the interviews and discussions were conducted in the local language, Bahasa Indonesia,
except for one restaurant owner who was not a native Indonesian and spoke mainly in English.
This was done to ensure there were no language barriers that limited the respondent to express
themselves to the interviewer.
These discussions and interviews were conducted within the period of 26 March 2021 until 22
May 2021 with no specific distribution as they were mainly following the time availability of
the respondents. The online discussions/interviews were conducted on online video conference
platforms: Zoom and Google Meet (depending on the respondent's preference). Each session
was recorded after confirming the consent of all respondents. For respondents who were
interviewed in person (some of the restaurants in Bali and all of the food delivery couriers), an
audio recording was done, except for an interview with one food delivery courier who did not
give consent to the recording of his/her responses.
55
Figure 9 Diagram of the reuse & return model shown to interview respondents
Conceptualized by the researcher herself, graphic content created through Canva (no date)
56
5.3. Qualitative content analysis
In general, qualitative content analysis is known as a mixed-methods approach to research. It
is qualitative in the sense that the researcher assigns his/her own categories to the text, but also
quantitative in that the frequency to which each category is mentioned across the set of texts
can be measured as well (Mayring, 2014).
There are two ways of category development: inductive and deductive. Inductive category
formation is also known as “open coding” meaning that the categories are developed “on-the-
go”, following the pattern of the passages and concluding on the relevant categories after going
through the passages. Hence the categories do not necessarily come from theories, rather from
the material itself. Meanwhile, deductive category formation is where the categories are already
defined beforehand (most likely following certain theoretical foundations), so that each passage
is analyzed line by line, strictly following the categories already selected (Mayring, 2014).
For this study, a hybrid or combination of the deductive and inductive category formation is
used. On the one hand it is deductive: categories are defined initially before going through the
text, drawing upon findings from the previous desk-based research and the interview with the
existing business case. On the other hand, the inductive approach would also serve to be helpful
as the methods used in this research is quite explorative, and the topic is also currently not
covered by extensive scientific work yet. New, unexpected categories may emerge from the
material. It is also inductive because the categories may also be rearranged into subcategories
along the way. The software used for the analysis is MAXQDA 2020.
The following sections describe in more detail how the transcription and analysis were carried
out.
5.3.1. Transcription of interviews/discussions
All discussions and interviews are first transcribed into text following a smooth verbatim
transcript, meaning that the transcription is done word for word but leaving out unnecessary
utterances like uhms, yeahs, etc (Mayring, 2014). Words in dialect are immediately converted
to their formal language form, first and foremost to make translation easier. The transcriptions
are first done in Bahasa Indonesia utilizing online transcription software, Sonix
(https://sonix.ai/) then translated to English with Google Translate
(https://translate.google.com/) and further refined by the researcher herself.
57
5.3.2. Defining categories and code words
Defining the code system is a focal point in the qualitative content analysis method (Mayring,
2014). To denote each category, a code word is defined within the MAXQDA software, and
the researcher then assigns each line or paragraph to the corresponding code word.
The code words are divided into three groups: “barriers”, “hotspots”, and “stakeholders”. The
former two groups are used to answer research question 2, meanwhile, the latter group is used
to answer research question 3. Within each group, there are categories defined. In later steps,
through inductive category formation, more categories (and even subcategories) can be added
to each group.
The initial list of code words was adopted from the list of drivers for single-use packaging from
Chakori et al. (2021), previously shown in Figure 4. Other code words were adopted from
insights of existing reuse-based business models related to packaging (both food and non-food
products), such as Kroon and Vrijens (1995)’s article on reverse logistics of secondary
packaging, a Zero Waste Europe (2018) report on a deposit-reusable food box system in
Switzerland, an article by Muuse (returnable food and beverage packaging company) CEO,
Reilly (2020), and the researcher’s own interview with founder and owner of CupKita (Jati,
2021). The categories under the code group “hotspot” are largely based on the researcher’s own
conceptualization of the business model concept, with some reference to Jati (2021), Kroon
and Vrijens (1995), Reilly (2020) and Zero Waste Europe (2018).
Table 6 Initial code system for the qualitative content analysis
No. Code words identified Reference
BARRIERS:
1 Convenience Chakori et al. (2021), Jati (2021)
2 Compatibility Chakori et al. (2021), Jati (2021)
3 Hygiene Chakori et al. (2021), Jati (2021)
4 Cost-benefit Chakori et al. (2021), Jati (2021),
Kroon and Vrijens (1995), Zero Waste
Europe (2018)
5 Complexity Jati (2021)
6 Environmental impact Chakori et al. (2021)
7 Branding Chakori et al. (2021), Zero Waste
Europe (2018)
8 Consumer/market preference Chakori et al. (2021), Jati (2021),
Kroon and Vrijens (1995), Zero Waste
Europe (2018)
9 Education Jati (2021)
10 Standards and regulation Jati (2021), Zero Waste Europe (2018)
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No. Code words identified Reference
HOTSPOTS:
1 Design and supply of universal packaging Jati (2021), Reilly (2020), Zero Waste
Europe (2018)
2 Inventory of universal packaging by the
firm
3 Storage and washing in retailers Jati (2021), Kroon and Vrijens (1995),
Reilly (2020)
4 Order and payment
5 Food preparation by retailers
6 Delivery by couriers
7 Use by consumers Jati (2021)
8 Reverse logistics Jati (2021), Kroon and Vrijens (1995)
9 Repair & recycling
10 End-of-life management
STAKEHOLDERS:
1 The firm Kroon and Vrijens (1995)
2 Food delivery couriers
3 Consumers Zero Waste Europe (2018)
4 Restaurants Zero Waste Europe (2018)
5 Suppliers
6 Government Zero Waste Europe (2018)
7 NGOs
8 Universities/experts
Having gone through all passages, new relevant aspects emerged; hence the code system grew
larger. Some new barriers were identified like “Trust” and “Halal & non-halal”, where further
analysis showed that these two barriers support the same main idea of quality control. The code
system was then revised again to include the subcategory level. For example, a new category
“Quality control” was created with four subcategories under it: “Quality control of packaging”;
“Trust”; “Hygiene”; and “Halal and non-halal”. Likewise, the category “Impact on brand” was
created to combine subcategories “Branding” and “Reputation”; the latter also identified
inductively. All codes of the final code system are defined and put into context, which is
summarized in Table 7.
Table 7 Final code system for the qualitative content analysis
No. Categories Subcategories Context/definition
BARRIERS:
1 Scale of business Size of business, e.g., large franchise restaurants, small or
medium-sized enterprise (SME), which may inhibit or
support the adoption of the business model
2 Cost benefit Implies that the costs of implementation outweigh the
benefits, and how the individual or entity prioritizes the
financial impact on themselves or their business
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No. Categories Subcategories Context/definition
3 Convenience Implies that the system is inconvenient, meaning that the
individual has to go through a process with much effort,
hassle, and difficulty that does not fit their daily activities
4 Complexity Implies that the individuals have to go through an intricate
or complicated process, having many components in the
system
5 Compatibility Implies the possibility that the universal food packaging
design will not work well or are not suitable for the food
style and portion of the individual restaurant. Also in
regards to how much the restaurant has to change in order
to adapt to the circular model
6 Accessibility Implies that the system is not easily reached, obtained, or
used by everyone, which applies in terms of payment and
refund mechanism, return mechanism, etc.
7 Limited resources Having limited physical and human resource in regards to
handling, transporting, and maintaining the containers
7.1 Limited labor Having limited human resource to manage and handle the
requirements of the circular model
7.2 Limited storage
space
Having limited space to store the containers when they are
not in use, or while transporting them
8 Liability Confusion over who will be held responsible when
damage happens to the asset (food containers)
9 Environmental
impact
Concern towards the actual environmental impact of the
whole life cycle: production of the container, distribution,
collection and redistribution, increased washing, etc.
10 Quality control Concern towards how the quality, hygiene, and halal and
non-halal separation is monitored. Also implies the
concern of trust, whether all actors can be reliable in
upholding the necessary standards.
10.1 Quality control of
packaging
Concern towards how the asset (food containers) will be
managed throughout its life cycle, how durable it is, how it
is maintained, repaired, monitored, etc.
10.2 Trust Implies the lack of belief towards the reliability of other
actors in the system in following regulations and standards
10.3 Hygiene Concern towards whether or not adequate cleanliness and
food safety standards are met
10.4 Halal and non-
halal
Concern regarding the need for halal and non-halal food to
be separated, and not utilizing the same containers even
after washing
11 Impact on brand Refers to the brand of retailers, especially the impact of
the reuse & return system towards brand image. “Brand
image” is linked to the advertising opportunity on the
physical container and in general the brand’s reputation
11.1 Branding Implies that the universal packaging does not allow for
distinct/unique advertisement of the individual restaurant
11.2 Reputation Implies that there will be an impact on public perception
towards the restaurant/business, for instance
12 Systemic lock-in Refers to the challenges imposed on the individuals by the
system itself, including standards and regulation, urban
planning and architecture, and the attitude of other actors
along the supply chain
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No. Categories Subcategories Context/definition
12.1 Standards and
regulation
Regulations that are too strict or not strict enough which
limit business development
12.2 Urban planning How architecture and urban space management/layout
support or, conversely, limit accessibility, transport, and
walkability
12.3 Lack of support
from other
stakeholders
Implies that there is pressure against or lack of system
support from other stakeholders, mainly supply chain
actors, to implement a circular model
13 Niche market Refers to the fact that the market for green products and
services are still a niche due to lack of concern for the
environment (on an individual level), lack of adequate
education/communication on environmental issues, and
simply the preference of the dominant market segment
which tend to shy away from the high costs of sustainable
products and services
13.1 Concern for the
environment
The extent to which the individual, the business, or the
public has pro-environmental attitude and behavior
13.2 Consumer/market
preference
Implies that there is a lack of demand for green or eco-
friendly products and services due to its higher costs
13.3 Education/
communication
Implies that environmental conservation and its issues are
not communicated well enough, both to the general public
or in education systems
14 Novelty Having a new system means that its performance and
reliability is still unknown
HOTSPOTS:
1 Design and supply
of universal
packaging
The process of designing and procurement of the universal
packaging
2 Inventory of
universal packaging
by the firm
The process of central storage of containers in the firm’s
inventory, both for storing brand new containers and for
the intake of damaged or end-of-life containers to be
repaired, recycled or disposed of
3 Storage and
washing in retailers
The process of storing and washing the containers by the
restaurants
4 Order and payment The process of food delivery order and payment,
facilitating information and monetary transfer from the
customer to the restaurant with the firm as the middle
man.
5 Food preparation by
retailers
The process of preparing food order by the restaurants
6 Delivery by couriers The process of delivering the food order from the
restaurant to the customer, done by the couriers who are
employed by the firm
7 Use by consumers The process of food consumption and use of food
container by the customer
8 Reverse logistics The process of returning the empty food container from
the customer to the restaurant, either through the couriers
or directly to the restaurant
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No. Categories Subcategories Context/definition
9 Repair The process of repairing damaged containers, so they can
be put back into the system again to be reused
10 End-of-life
management
Recycling and disposal of end-of-life materials
STAKEHOLDERS:
1 The firm Responsible for the design, supply, and management of
the reuse & return system, as well as facilitating a
platform where customers can easily access multiple
restaurants for food delivery orders.
2 Food delivery
couriers
Couriers who deliver food orders from restaurants to
consumers on motorbikes, employed by the firm.
3 Consumers Users of the food delivery app and services as well as the
reuse & return system.
4 Restaurants Businesses that are partners of the firm who provide the
food service.
5 Suppliers Businesses that supply the materials and resources, or
even produce the food containers.
6 Government The formal authority governing the regional or national
scope
7 Non-governmental
organizations
(NGOs)
Organizations which have a specific interest or cause, e.g.,
environmental organizations, which most often operates
non-profit activities
8 Universities/experts Universities or experts in the field of sustainability,
circular economy, or other related fields
9 Small- and medium-
sized enterprises
(SMEs)
Small-scale businesses owned by individuals, families, or
small enterprises
10 Catering services Businesses that provide food services and delivering them
to an outside location, ranging from large scales (for
events, parties, organizations) or small scale (individual,
families)
11 Franchise and
business chains
Businesses with many outlets in different locations, e.g.,
McDonald's, Starbucks, and in the Indonesian context,
Bakmi GM (restaurant chain selling traditional noodle
soup dishes)
12 Convenience stores Mini supermarket chains that are available in many
different locations that are highly accessible in urban and
even suburban areas in Indonesia
5.3.3. Analysis
In order to understand the method of quantification in qualitative content analysis, the units of
analysis must be defined first hand. There are three units mentioned by Mayring (2014):
• Coding unit: the minimum portion of text which can fall under one category/code word
sets the sensitivity of the analysis. Is one word enough, or does it need to be a complete
sentence to be coded into a different category?
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• Context unit: the maximum portion of text which can fall under one category/code word
• Recording unit: which text portions apply to the system of categories (Mayring, 2014)
For this study, the units of analysis are defined as such:
• Coding unit: a complete phrase that either includes the precise code word or interpreted
to mean or imply that code word
• Context unit: a paragraph, or more that is consecutively spoken, assuming that even if
the respondent gives a very long answer that extends to several paragraphs, it could still
be relevant for just one main idea corresponding to one code word. In the case that the
same idea is expressed as an answer to a different question, then it will be coded as a
new segment
• Recording unit: all interview and discussion texts, including the interview with the
existing business case (although the results from this particular interview is used as a
basis to develop the code words, hence it was the first interview to be analyzed)
The quantitative portion of the analysis is largely based on the frequency of mentions of each
code/category by each respondent. This frequency data shows which aspects were mentioned
most times hence implying its significance. Using the MAXQDA “code matrix browser”
function, a table summarizing code mention frequencies (in absolute numbers) was extracted
into Excel to be further analyzed. Because the number of respondents per stakeholder group is
not uniform, absolute numbers could not be used. Instead, the frequencies were converted into
percentage to represent each stakeholder group (the customer and restaurant groups were
analyzed in two ways: combined all together and separated into two groups according to their
region). After the individual frequencies were combined to get a group frequency, we obtain
only 1 number (a percentage) for each code in each stakeholder group. No further weighting
factors were used to differentiate the significance of one stakeholder group over the other.
Hence, each stakeholder group had an equal weight to contribute to the general overview. This
method is used to analyze the “barriers” and “hotspots”. Meanwhile, for the “stakeholders”,
the code words were only used to highlight the actual statement regarding stakeholders. Hence
it will be used to locate portions of the text that will explain the interaction of stakeholders and
not so much to calculate frequencies of mentions.
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6. Results
The results of the desk-based research and empirical study will be presented in the following
subchapters. Results regarding research question 1, namely the overview and characteristics of
existing reuse & return models, will be presented in Subchapter 6.1. The result from this part
was gathered through literature research as well as a single interview with a reusable and
returnable coffee cup start-up in Indonesia called CupKita.
The second research question will be answered in Subchapters 6.2 and 6.3. This part covers the
barriers and hotspots of the reuse & return model, respectively. The data to support the results
in these two subchapters was gathered from the empirical study (interviews and focus group
discussions), involving five different groups of stakeholders: food delivery couriers,
restaurants, customers, NGOs, and experts. This was based on a hypothetical business, so the
results do not reflect the direct experience of the respondents of this exact reuse & return
business model, rather it builds on their experience from the conventional, single-use
packaging system in order to extract their expectations and initial perception of a new circular
business model.
The third research question will be addressed in Subchapter 6.4, which covers the stakeholder
network analysis. This part is also mainly based on the empirical data from interviews and
focus group discussions. Hence the respondents’ comments regarding other stakeholder groups
are summarized and discussed. However, in order to have a more holistic view of the
stakeholder network, some insights from literature were added to supplement the empirical
findings.
6.1. Existing reuse & return models
Reusable packaging has been acknowledged in both scientific and grey literature as one
solution to combat the global plastic pollution issue (Ellen MacArthur Foundation, 2019;
Kroon and Vrijens, 1995; Sazdovski, Bala and Fullana-I-Palmer, 2021; Zero Waste Europe,
2018). Sazdovski, Bala and Fullana-I-Palmer (2021, p. 10) states that “the reuse of packaging
has the highest value in the product-component-material circular hierarchy,” implying that the
fundamental concept of reuse is of high significance in the emerging modern concept of
circular economy. Ellen MacArthur Foundation (2017) estimated an economic opportunity of
at least USD 9 billion for just the reuse of 20% of plastic packaging. Though quite disruptive
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to the mainstream, business-as-usual model of the current economy, reuse business models can
be made possible especially with the help of digital technologies (Ellen MacArthur Foundation,
2019).
Some common terminology connected to reusable packaging models for a wide range of
industries (not limited to the food service sector) include:
• Reverse logistics (Kroon and Vrijens, 1995)
• Deposit-return systems (DRS) (CM Consulting and Reloop, 2016)
• Reusable and returnable (Greenwood et al., 2021)
• Take-back systems (Bocken et al., 2014; Sachs, 2006)
The third term (reusable and returnable) will be more largely used in this study. The second
and fourth terms (deposit-return and take-back systems) are more often linked to downstream
collection and recycling of single-use packaging. Meanwhile, this study aims to look into more
upstream circular design interventions. The first term (reverse logistics) also does not quite fit
as it is often used to signify just one process within the whole system of reuse & return. The
following sections will elaborate in further detail on the overview of existing business cases,
their typical characteristics, as well as barriers and success factors or learnings found in
scientific and grey literature.
6.1.1. Overview of existing business cases
The idea of reusable and returnable containers has been in discussion as far back as 1995 when
Kroon and Vrijens (1995) investigated the application of circular models for the use (and reuse)
of secondary packaging material. Secondary packaging material includes pallets, crates, and
boxes that are used for packaging products during transport in retail or industry. The
mainstream, single-use material mentioned by Kroon and Vrijens (1995) is cardboard. Benefits
of this reusable system have been reported by a few companies, with claims such as $600,000
savings over two years of using returnable packaging material for steel shelves by Herman
Miller Inc. and other success stories from IBM, Ford, General Motors, and Toyota (Kroon and
Vrijens, 1995). Although the focus of Kroon and Vrijens (1995)’s study is not even in the food
service sector, findings presented in their article were found relevant for this study in regards
to general reuse models.
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In the food and beverage industry, more large scale, nation-wide examples can be found on
deposit-return models for single-use beverage packaging (CM Consulting and Reloop, 2016),
in contrast to the smaller, local-scale reuse-reuse models for multi-use food and beverage
packaging (Ellen MacArthur Foundation, 2019; Zero Waste Europe, 2018). The more
advanced development of the former could be accredited to the fact that there are more
governmental regulations available which address single-use beverage or food packaging
specifically and focus on the recycling and management of the waste. Such mandates have been
implemented in several countries in Europe and North America since as early as the 1970s (CM
Consulting and Reloop, 2016) meanwhile the push towards circular and reuse models have
only been more vocal in recent years (Ellen MacArthur Foundation, 2015; Matthews, Moran
and Jaiswal, 2021; World Economic Forum, Ellen MacArthur Foundation and McKinsey &
Company, 2016).
CM Consulting and Reloop (2016) published a report summarizing 38 deposit-return systems
for single-use beverage containers in a global context. In these systems, customers pay a small
deposit with each can or bottle of beverage that they purchase. Their deposit will be paid back
to them once they return the used containers to a collection point. The containers then get
transported to recycling sites and afterward return to the system for producers and retailers to
use. The collected packaging materials are typically plastic (PET, HDPE), metal (aluminum,
steel, tin cans), and glass for a wide variety of beverage products: water, soft drinks, alcoholic
drinks, milk, and juice. Most of these systems use barcode technology for their data recording
system, meaning that each beverage container is embedded with a barcode which makes them
easy to track, especially regarding the return. Return rates vary with each region, with the range
being 74-97% in Europe and 50-93% in North America (CM Consulting and Reloop, 2016).
A model that more closely relates to the reuse & return system is what Greenwood et al. (2021)
called “the return model” and “the collective return system”. A collective return system
integrates a network of manufacturers to utilize the same set of containers. The containers are
then returned to cleaning facilities which recondition the containers to be used by the
manufacturer/retailers again. No specific business case relevant to this study was mentioned in
this article, as the main objective of the study was to conduct an LCA of several packaging
materials in different scenarios (single-use, refill, return-reuse). They did, however mention
one business case in the fast-moving consumer goods (FMCG) industry, that is Loop: a
reusable packaging solution currently operating in the US, Canada, UK and France to supply
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reusable product containers, ranging from ice cream to shampoo, to FMCG brands worldwide.
In this business model, the firm (Loop) only facilitates the logistics and washing of the
containers meanwhile, each brand can choose their own type, shape, and design of reusable
containers (Greenwood et al., 2021; Loop, no date). This modification of the original collective
return model was seen as most suitable for the FMCG sector as the packaging can be
customized to facilitate unique branding of the companies (Greenwood et al., 2021). Though
most cases of reuse systems in food and beverage take-out and delivery typically use just one
universal container (which may vary in shape or size, but not in brand design), Loop’s business
concept presents an important finding: that the logistics and business model would need to be
rearranged quite significantly even if only to fulfil marketing needs.
One report by Ellen MacArthur Foundation (2019) was found to be quite useful in introducing
general concepts of reuse systems in the food service sector. The report discusses the reuse
strategies for various types of packaging of consumer products, food, and beverages, and
presents several case studies of existing reuse models around the world. The benefits of reuse
identified are:
• Superior design
Reusable systems often use more durable materials that are more expensive but also
superior in function and/or design, and in turn, improves the user experience. The
initial investment of such packaging can become lower than single-use packaging
when it is used many times over
• Smart systems
Digital tracking systems are often used together with reuse models, with technologies
such as RFID tags and GPS tracking. These technologies enable firms to gather user
information and system performance without much hassle
• Shared design
Economies of scale can be achieved through common design of packaging that can be
used by a variety of brands and sectors.
• Customization
Reuse models can adapt to individual needs better, with the possibility of personalizing
quantities and variants of products, e.g., flavor
• Compact products
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Products in compact form can cut packaging and transportation costs, e.g., from liquid
products to concentrates or solid tablets
• Deposit and reward
Deposit or reward schemes for reusable packaging can attract customers and build
loyalty towards the brand (Ellen MacArthur Foundation, 2019).
Ellen MacArthur Foundation (2019) also proposed four reuse models for business-to-consumer
products:
• Refill at home
Users refill their reusable container at home, for example, with home-delivered refills
provided through subscription
• Refill on the go
Users refill their reusable container outside of their home, for example, an in-store refill
system
• Return from home
Used packaging is picked up from the user’s home
• Return on the go
Used packaging is returned to the store or at a specified drop-off point by the user
themselves (Ellen MacArthur Foundation, 2019).
Examples of existing reuse schemes for food takeaway and delivery systems most often follow
the return on the go and return from home approaches.
In order to identify the characteristics of existing reuse & return businesses, eight existing
business cases were selected, either from the Ellen MacArthur Foundation (2019) report or
from Google searches of “reusable returnable food container” or “reusable returnable food
packaging”. These businesses were selected based on these criteria in the given order:
• provide business-to-consumer (B2C) services, not only business-to-business (B2B)
shows a relevant scheme for customer home delivery services, not the provision of
reusable containers for large events or stadiums
• scope of service
food packaging services are essentially the target, but some cases of businesses which
only provides beverage containers are also considered
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• current status of development
businesses that are no longer inactive or are too early in the pilot phase are omitted, the
latter due to the fact that the data regarding their business model (on their website or
other grey literature) are usually not sufficient
• region of operation
to ensure representation of different continents
• availability of grey literature
to ensure sufficient data, for example, from the company’s own website, news agency
articles, or other media coverage
The business cases considered for this part of the study are:
1. Muuse (Singapore, Hong Kong, Toronto)
Provide reusable-returnable cups and food boxes for takeaway and delivery in
restaurants and cafés with customer subscription programs. They are also connected to
large food delivery apps such as GrabFood and FoodPanda.
2. CupKita (Indonesia)
Provide reusable cups to cafés for takeaway only, hence only for in-store purchases in
restaurants and cafés.
3. barePack (Singapore)
Provide reusable-returnable cups and food boxes for takeaway and delivery in
restaurants and cafés with customer subscription and deposit-refund programs. They
are also connected to large food delivery apps such as FoodPanda, Deliveroo, and
GrabFood.
4. RECUP (Germany)
Provide reusable-returnable cups for takeaway with a deposit-refund scheme in a large
variety of retailers (not only restaurants and cafés, but also gas stations and corporate
offices).
5. reCIRCLE (Switzerland)
Provide reusable-returnable food boxes for takeaway in restaurants and cafés with a
deposit-refund scheme. The consumer can choose to reuse the box as much as they’d
like, or they could return and ask for a new reusable box with every purchase, or they
could return and ask for a refund.
6. DabbaDrop (UK)
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Delivery of weekly meals in reusable boxes that resemble the Indian tiffin carriers.
They do not provide reusable containers to other restaurants Rather, they themselves
provide a selection of menus from their own kitchen for customers to pre-order.
7. DeliverZero (USA)
Provide a food delivery app that works like any other typical online food delivery app,
but also providing reusable-returnable boxes to their partner restaurants.
8. GO Box (USA)
Provide reusable-returnable food boxes for takeaway in restaurants and cafés with a
customer subscription model.
More detailed datasheets regarding the business cases mentioned above are given in Appendix
B. The following subchapter will further discuss the findings and summary of the typical
characteristics of these business cases.
6.1.2. Typical characteristics
In order to compare these business cases, the main elements of a business model will be used
as an outline to present the findings, which are: value proposition, supply chain, customer
interface, and financial model (Boons and Lüdeke-Freund, 2013). Another element found
relevant is main resources, which signifies the assets, materials, and technologies that are vital
to these circular business models; hence it will also be discussed.
Value proposition
The fundamental characteristic common to all of these eight business cases lies in the value
proposition and value creation: they provide reusable containers for takeaway and/or food
delivery services. Most of them deliver B2B and B2C services. To businesses or retail partners
such as restaurants and cafés, they provide reusable takeaway/delivery containers, a system to
manage the supply, maintenance, distribution, and end-of-life treatment of the containers, and
the necessary training to support the transition. To customers, they provide an online platform
(usually in the form of a mobile app) that lets the customers borrow or rent the reusable
packaging when doing takeaway or food delivery at a registered retail partner. The business
does not provide the core service or utility (i.e., ready-made meals and beverages), but it acts
as a middle-man to connect customers to restaurants in a food service network that fosters
material circularity. DabbaDrop is one exception to this characteristic, though. They provide
reusable containers for food delivery, but they do not build a network of restaurants from which
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customers may choose order food and beverage. Instead, DabbaDrop provides the food directly
from their own kitchen; hence the containers are only circulated between the single company
and their customers. This certainly makes the logistics not as complex as in the other business
cases, where containers are continuously being circulated between the company, its retail
partners, and its customers.
Another prominent similarity in the value proposition of these businesses, is their common
vision and purpose. All of these businesses are passionate about the zero-waste and/or plastic
pollution cause, and they started out as “seeking circular solutions” to keep the food service
industry alive but eliminating the detrimental environmental effects of single-use packaging
waste. Not only is this evident in the way media presents their cases (Baker, 2018; Chapman,
2021; Hicks, 2020; Ho, 2021; Ong, 2020; Salim, 2020), but how these businesses present
themselves on their own websites also very clearly emphasizes the urgency for circular
solutions to address sustainability, and mostly environmental, problems.
“Born from the frustration upon witnessing the abundance of disposable
plastics consumed in Singapore, and the injustice felt having to choose
between convenience and sustainability. barePack's practical day-to-day
solution makes food online delivery sustainable, fights disposables and the
over packaging waste culture, with a focus on education” (barePack,
2021b)
“DeliverZero's founders—Adam Farbiarz, Byron Sorrells, and Lauren
Sweeney—are all working parents. Returning emails and spearheading
bathtime often take priority over cooking. At the same time, we’re deeply
concerned about the future of our planet. We don’t want to add to the mess
our kids’ generation will have to clean up.” (DeliverZero, no date)
“…we are committed to supporting local producers & customers who want
to transition away from single use packaging by providing a system of
reusable packaging that is safe and sustainable in our operations,
transparent in our impact reporting & dedicated to building a future where
natural resources are valued and honored through reuse.” (GO Box, no
date)
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Supply chain (and material flow)
Though the element “supply chain” is supposed to describe the upstream relationships with
suppliers, this element can be extended to include more aspects within the reuse & return
models. Additional elements of the business flow that are vital to such reuse & return business
models are the distribution, reverse logistics, and redistribution of goods within the system
(Jati, 2021; Kroon and Vrijens, 1995; Reilly, 2020). The upstream flow is typically the same:
the firm forms a partnership with manufacturers who produce the durable, food-grade, reusable
containers; the goods are transported to the firm; and the firm then distributes these containers
to their retail partners. This part of the business flow can be generalized as the “design and
supply of containers”. Since the business model requires a return process, further questions
must be considered:
• Reverse logistics: How are the containers returned to the system after use? (Jati, 2021;
Kroon and Vrijens, 1995; Reilly, 2020)
• Washing: How are the containers cleaned, sanitized and reconditioned for reuse? (Jati,
2021; Reilly, 2020)
• Redistribution: How will the flow of containers be maintained? (Kroon and Vrijens,
1995)
• End-of-life: What is the end-of-life management like?
The reverse logistics or return schemes do not vary too widely between the business cases.
From the customers’ perspective, they are usually given three alternatives: return to any retail
partner, return to specific drop-off sites which are separate from the retail partners, or have the
containers picked up by the delivery person or courier upon the following order. The most
common alternative that almost all of the business cases give is the first return scheme (except
for DabbaDrop where the only possibility of return is with the third alternative). The second
return alternative is only found in two cases: Muuse and GO Box. No common characteristic
between the two cases was found to correlate to this, since Muuse seem to operate on larger
scale, even partnering with tech giants GrabFood and FoodPanda for food deliveries aside from
takeaways, meanwhile GO Box is more of a local-community-oriented business which only
provides takeaway service. The third alternative is only available in business cases where they
are integrated into other online food delivery businesses (Muuse and barePack) or if they
themselves provide the delivery service (DeliverZero and DabbaDrop). Each alternative has
different implications on the business model. For the first alternative, there is no additional
72
assets or physical resources needed since retailer partners will receive the boxes and prepares
them for reuse. For the second alternative, the company will have to set up specific drop-off
sites, typically in the form of boxes or machines in public areas, but office or store-like spaces
could also be possible, for example, in cases where the return location is also a central washing
site. No additional assets are needed for the third alternative, since the courier and their
equipment are already considered when deciding to integrate a delivery service into the
business model.
The washing scenarios also relate closely to the reverse logistics alternative chosen. The
containers could be washed in central washing facilities provided by the company (Muuse and
GO Box), which typically goes hand-in-hand with having the option for customers returning
the containers to specific drop-off sites or return stations. A second alternative would be that
washing is done by the retail partners (RECUP, reCIRCLE, barePack, CupKita, DeliverZero),
which typically implies that the company does not own a separate central washing facility
except for the case of Muuse where they integrate both of these washing alternatives.
The question regarding redistribution is also a vital part of the business model, though typically
not so evidently shared through media or the company’s website. For companies who have the
option of return at any random registered retail partner (which applies to most of the business
cases presented), the following question arises: how do they make sure that each retail partner
will have enough reusable containers to fulfill their takeout/delivery needs at all times? It is
possible that with tracking technologies, the company can ensure the balance and maintain a
continuous flow of containers in adequate quantities to each partner. It can only be assumed
that the company employs a designated team specifically for redistribution purposes or that the
volume or demand of returnable boxes is still relatively low for the issue of empty inventory
to be a problem.
The end-of-life management can be automatically assumed to be the company's responsibility,
not the retail partners or customers. Though not all of these businesses specify how their end-
of-life management works, it is usually implied that the company will collect any damaged or
end-of-life containers and have them repaired or recycled by a third party.
“Damaged aubergine-coloured reCIRCLE products can be exchanged for
new ones at our partner restaurants. They are collected, returned to us,
73
recycled directly by the producer in Einsiedeln, CH and thus receive a new
life!” (reCIRCLE, no date)
Customer (and partner) interface
The two primary stakeholders that are most critical to reusable-returnable businesses are their
customers and retail partners. Most of these businesses (except for DabbaDrop) have their own
mobile apps that facilitate information flow from the company to the customers and retail
partners. This form of “personal engagement” is one means of managing customer and partner
relationships.
Customers are immediately engaged and “tied” into a loyalty program to the company once
they opt for the reusable packaging in their takeaway or delivery order. The formulation of the
financial model is closely linked to this aspect. Periodical subscription models make sure that
customers stay within the system for at least that one period. Even with deposit-refund models,
the customer stays connected to the system until they return the containers. Although the need
to return the containers creates a burden for the customer, it also allows for close engagement
between the company, the customer, and the retailer. It creates a new kind of user experience,
along with the fact that the premium design of the containers has a specific aesthetic value in
themselves (Jati, 2021). Loyalty can also be encouraged by introducing discounts in the price
of meals or beverages that they order with the reusable container (Muuse, 2020b; Reilly, 2020).
As for retail partners, most of the businesses provide training and support during the transition
period between single-use to reusable packaging. A well-functioning communication system
between the retail partners and the company should be a prerequisite for smooth operation since
the retail partners are dependent on the company for the inventory and maintenance of the
reusable containers. In the case of barePack, restaurants even receive weekly reports on their
environmental impacts (barePack, 2021c).
Financial model
The financial model does not vary too much between the business cases. The payment scheme
for customers could either follow a deposit-refund model or a periodical (monthly or annual)
subscription model. In the case of barePack, the customer has the option of both payment
schemes. DeliverZero is an outlier in this aspect, as they do not charge their customers anything
in advance, other than a fee when the container is not returned after six weeks.
74
For retail partners, joining in the reusable-returnable network means either having to pay a
periodical membership fee or service charge (reCIRCLE, GO Box, RECUP, DeliverZero), pay-
per-use (CupKita). In the case of Muuse however, retail partners have no financial obligation
whatsoever towards the company. They are only obligated to accept every product return and
sanitizing the containers, following the necessary standards and protocols, to prepare for reuse.
Main resources
The common resources that are the hallmarks of these reusable-returnable business cases are
technology, containers, and network. Technology here refers to whether or not the business
utilizes tracking technologies such as RFID tags and QR codes in order to trace the
“movement” of their assets, i.e., each individual food or beverage container (Figueiras, 2020;
Reilly, 2020). RECUP and DabbaDrop both do not utilize any tracking technologies, though
they have very different scales and strategies. RECUP has reached a broad audience of retail
partners, including not only cafés and restaurants but also gas stations; hence perhaps the model
is already so widely used and has a smooth supply chain management which renders tracking
useless. On the other hand, DabbaDrop is much simpler in that they do not engage with other
businesses to deliver their value. They themselves provide the food, the reusable containers,
and the delivery service directly to the customers. Hence customer accounts should be
sufficient to allow for tracking of the containers. For some cases like reCIRCLE and
DeliverZero, it is unclear whether or not they use any tracking technologies.
The second main resource is the container itself. The material and design chosen for the
container is an integral part of the business model, as it affects the capital (manufacture and
import) and operational costs (maintenance and washing), becomes the face of the brand, and
determines the environmental impact of the business (depending on material type, optimal
lifetime, and end-of-life management methods). The typical materials for these reuse & return
models include durable plastic (PP), silicone, stainless steel, tin, and bamboo fibre for the food
boxes; stainless steel and plastic (PP) for the cups. Some businesses, like reCIRCLE even go
as far as taking careful consideration and branding into what color their product should be (they
call it “aubergine-colored”). They stated:
“reCIRCLE is new. To achieve a change in behaviour, it must be made
visible. Therefore we had to choose a colour that clearly stands out against
existing packaging colours…
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…Aubergine is conquering Switzerland as the colour of reusables!
There are places where the aubergine coloured reCIRCLE BOX is already a
remarkable part of the city image.” (reCIRCLE, no date)
The third main resource is the network of partners. Except for DabbaDrop, the success of all
of these businesses is largely defined by the network of retail partners which use their food or
beverage containers. The more retail partners are connected through their network, the easier
it should be to increase market awareness; hence the more likely and faster it is to grow the
company’s customer base. With each additional retail partner, the business also benefits from
the additional marketing resource, for instance, through physical stickers of their logo on the
store’s entrance door. The retail partners will also actively promote or endorse the reusable
packaging, further educating the public about it.
In the cases of Muuse, barePack and reCIRCLE, partnering with tech-based giants also helped
them expand their business into new scopes of services. BarePack has partnered with food
delivery service providers Deliveroo, FoodPanda and GrabFood, while Muuse has partnered
with only FoodPanda and GrabFood, both in the regional context of Singapore. ReCIRCLE in
Switzerland also partnered with the country’s largest retail and supermarket chain, Migros, and
achieved a significant increase in restaurant participation through the partnership. A 2018
report indicated that reCIRCLE has 182 restaurant associations and an additional 230
restaurants from the Migros chain partnership (Zero Waste Europe, 2018).
Table 8 summarizes the main distinctive characteristics of each of the eight business cases
considered. For further details on each of the business cases, refer to Appendix B.
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Table 8 Summary of reusable & returnable food packaging business cases
No. Business
case
Region Scope of service Retail
partners
Tracking
technology
Mobile
app
Material Washing Return
mechanism
Payment model
Customer Retailer
1 Muuse Singapore Provides
reusable-
returnable food
and beverage
containers for
takeaway and
delivery, the latter
done through
GrabFood and
FoodPanda
60+ cafés
and
restaurants
QR code Yes Stainless
steel cups,
bamboo
fiber food
boxes
On-site
and
central
Return directly
to retail
partners or to
designated
return stations
Subscription Free of
charge
2 CupKita Indonesia Provides
reusable-
returnable
beverage cups for
takeaway
7 cafés QR code Yes Stainless
steel cups
On-site Return directly
to retail
partners
Deposit-refund Pay-per-
use
3 barePack Singapore Provides
reusable-
returnable food
and beverage
containers for
takeaway and
delivery, the latter
done through
Deliveroo,
GrabFood, and
FoodPanda
140+
restaurants
and cafés
QR code Yes Silicone
Flexboxes,
stainless
steel cups
On-site
and
central
Return directly
to retail
partners or
request for
home collection
(for subscribed
members only)
Subscription
or deposit-
refund
N/A
4 RECUP Germany Provides
reusable-
returnable
beverage cups for
takeaway
7,500 points
of sale
N/A Yes Plastic (PP)
cups and
lids
On-site Return directly
to retail
partners
Deposit-refund Service
fee
5 reCIRCLE Switzerland Provides
reusable-
returnable food
1,500
restaurants
and cafés
N/A Yes Plastic
(PBT)
boxes,
On-site Return directly
to retail
partners
Deposit-refund Service
fee
77
No. Business
case
Region Scope of service Retail
partners
Tracking
technology
Mobile
app
Material Washing Return
mechanism
Payment model
Customer Retailer
boxes for
takeaway
plastic (PP)
cups
6 DabbaDrop UK Delivers weekly
meals in
traditional Indian-
style tiffin boxes
- None No Tin boxes,
stackable in
4-tiers
Central Picked up by
delivery person
on the next
order
Subscription -
7 DeliverZero USA Provides food
delivery network
and platform, as
well as supplying
its retail partners
with reusable-
returnable food
boxes
139
restaurants
and cafés
N/A Yes Plastic (PP)
boxes
On-site Return directly
to retail
partners or
through the
delivery person
on the next
order
Free of charge
(unless they
fail to return
the box in 6
weeks)
Service
fee
8 GO Box USA Provides
reusable-
returnable food
boxes for
takeaway
70
restaurants
and cafés,
40 corporate
partners
QR code Yes N/A Central Drop-off site Subscription Service
fee
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6.1.3. Challenges and learnings from real business case
Apart from the typical characteristics of reusable-returnable business models in food takeaway
and delivery systems that have been discussed in the previous section, there were additional
findings from the desk-based research as well as the researcher’s own interview with CupKita
owner Jati (2021) that were of significance to this study, particularly regarding the challenge
and learnings from real business cases.
Niche market and organizational inertia
The “typical characteristics” findings highlight the main differences of the circular business
model to the mainstream linear models of single-use packaging. Although this presents a
unique value proposition on its own, the novelty in itself is already a barrier against market
entry. The business model still applies to a very niche market, not only in terms of the consumer
market but also the retailers as well. On the topic of how CupKita recruited their partners, Jati
(2021) mentions:
“So, it is actually easier for us to approach small cafes. Because usually, if
they are small cafes, they are more passionate about their business.
Compared to the usual franchises like XXXX and XXXX, they are already
very capitalist; they mostly just think about profit. We are more likely to
approach the ones who are passionate about coffee, passionate about (the
products they sell)…” – CupKita, (Jati, 2021)
On a similar note, Kroon and Vrijens (1995) note that the decision between single-use
packaging and reusable systems ultimately lies in the economic and logistic implications for
the company, not the environmental impact. The service charge linked to returnable systems is
generally higher than the cost of single-use packaging. Meanwhile, the advantages of
returnable systems are more intangible (Kroon and Vrijens, 1995), which further strengthens
organizational inertia to maintain business-as-usual. The environmental benefits and disruptive
model could ideally become attractive to businesses, but this is more likely when the model is
not so new anymore and has been adopted by many companies around them, hence putting the
non-users at a competitive disadvantage (Zero Waste Europe, 2018).
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The role of standards and regulation
CM Consulting and Reloop (2016) summa the government mandates that become the basis of
developing various reuse & return systems for single-use beverage packaging in different parts
of the world. Such regulations predominantly focus on reducing and recycling single-use
packaging, resulting in the birth of deposit return systems of soda cans, water bottles, etc.
However, the current legislative system was found to be inadequate to support the case of
reCIRCLE, the Swiss reusable food container enterprise (Zero Waste Europe, 2018).
Comparing two financial models simultaneously running under reCIRCLE, they claim that
reducing the deposit price does not necessarily increase market acceptance. However, they
identified the lack of policy incentives against single-use food containers as the main barrier in
changing customers' consumption habits since it did not create “a level playing field” (Zero
Waste Europe, 2018, p. 6).
Jati (2021) notes a different kind of regulation that has become a barrier for the growth of
CupKita: hygiene standards. In the Indonesian context, strict hygiene standards typically only
apply to large enterprises such as international-scale hotels and restaurants or large business
chains. They might even comply with ISO 22000 or internationally-acclaimed food safety
certifications. But at the SME level, the hygiene standards mandated in national acts are vague
and do not impose specific technical instructions. He then compares the Indonesian context
with that of Singapore, more specifically regarding the experience of Muuse, who is a partner
of CupKita. Jati (2021) notes that the Singapore hygiene standards are much more stringent in
contrast to Indonesian standards.
“We have a partner in Singapore, called Muuse. I see that the regulations
in Singapore are very intensive. There is even a standard water
temperature, what soap to use. That's really intensive. And that's from the
government itself.” – CupKita, (Jati, 2021)
The lack of strict hygiene standards presents a challenge to CupKita, in that they need to define
their own protocols. With no local legislation as a basis for their design, it’s up to CupKita to
decide what is safe enough but at the same time not burdensome to businesses. If they were to
engage SMEs who are not used to complying with strict food safety standards, how could they
convince retailers to follow through with more stringent protocols for the sake of gaining
customer trust? Though indirect to the issue of food packaging, a wide range of government
80
regulations, incentives, or any kind of support may very well influence the adaptability of such
circular business models.
Urban architecture
On the topic of comparing consumers' perspectives in different cities of Indonesia towards the
reuse & return scheme of food containers, Jati (2021) comments that urban planning and urban
architecture could contribute to the different attitudes between cities. The case discussed was
that consumers in Jakarta were more reluctant to return food boxes to the nearest retail partner
by themselves (without the aid of couriers), than is the case for consumers in Bali. Jati (2021)
further makes the comparison that Bali is a more walkable city than Jakarta and that the urban
architecture makes a significant difference in determining how willing individuals are to
conduct activities outdoors or which mode of transport they choose. In turn, the intensive
personal motor-powered vehicles culture in Jakarta would also impose worse traffic, limited
parking space, and higher costs for parking, toll roads, etc., which make it even more unlikely
for individuals to choose more sustainable options of travel. Though this was conceived
through years of infrastructure development and challenging to change instantly, urban
architecture is a force that needs to be reckoned with when designing circular business models.
The importance of stakeholders
As discussed in the theoretical foundation chapter of this report, we again acknowledge the
importance of stakeholders in realizing circular business models. However, when asked about
the most influential stakeholders in the development of CupKita, Jati (2021) remarks that the
customers and restaurants themselves are still the most determining stakeholders. Although
government bodies, NGOs which connect the needs of impact-oriented businesses to
government agenda, and business partners such as Muuse in Singapore have great influence on
the innovation process, it is still quite difficult to engage the primary stakeholders (customers
and restaurants).
In the reCIRCLE case, the role of secondary stakeholders was emphasized to be necessary. In
fact, support from municipalities at local and cantonal scale all over Switzerland has helped
reCIRCLE reach a larger audience and gain more partners. The success of circular models like
reCIRCLE depends highly on the coordination between the public sector, restaurants, and
customers (Zero Waste Europe, 2018).
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Reverse logistics is crucial
It has been noted that reverse logistics and the return mechanism of reusable systems are crucial
in shaping an economically (and environmentally) viable business model (Kroon and Vrijens,
1995). Furthermore, Jati (2021) also emphasizes that the return phase of CupKita’s business
model is the most critical part of the material flow. Due to the apparently low cost of the initial
deposit, coupled with the premium design of coffee cups, CupKita’s return rate is at a
surprisingly low rate of about 30%. Although the financial model most likely accounts for some
portion of unreturned containers, meager return rates would eventually lead to a rebound effect.
The fewer reusable containers returned to the system, the more the company has to supply or
restock new containers into the inventory, meaning more material and energy consumed for
the manufacturing process. Meanwhile, the very idea of providing reusable containers to the
public was to endorse the optimization of material lifetime through the sharing and extensive
reuse of high-quality, durable products. If these products were treated more like their single-
use counterparts, it would ultimately defeat the purpose of creating circularity and minimizing
environmental impact.
6.2. Barriers
Unlike the overview of existing reuse & return business cases, the barriers to the reuse & return
model were identified through empirical work. This was done through stakeholder interviews
and focus group discussions. The complete list of respondents is given in Table 5, while the
list of questions that became the basis of the semi-structured interviews/focus group
discussions are given in Appendix A.
Interviews and focus group discussions were conducted with a total of 28 respondents
(excluding the CupKita interview which was primarily used for the previous section) from 5
different stakeholder groups:
• Five delivery couriers
• Ten consumers/customers
• Ten restaurants
• Two NGOs
• One expert.
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All interviews and focus group discussions were transcribed, translated, and analyzed with the
qualitative content analysis method, utilizing the MAXQDA 2020 software. Through deductive
and inductive qualitative content analysis, 14 categories and 14 subcategories were identified
within the code system, as summarized in Table 7. For the sake of concise data presentation,
the number of mentions related to subcategories is accumulated to its corresponding category.
First, the comparison of views between stakeholders will be discussed to achieve an overview
of which barriers were seen to be most significant. Second, the views of the
Consumer/customer and Restaurant groups will be compared according to their region (Jakarta
vs. Bali) to see whether or not there are significant differences between the two. Lastly, the
barriers which relate closely to each other will be discussed, linking the interaction between
them. More detailed findings on each of the barrier categories will be presented in the following
sections as well.
Overall, the most significant barriers were found to be, in order from most to least mentions:
Cost benefit, Quality control, Convenience, Niche market, and Compatibility. But when the
numbers were analyzed at the stakeholder level, the order shifts differently in each stakeholder.
The NGO and Restaurant groups were most consistent with the general perspective. Their top
5 barriers are also the same top 5 barriers of the population mentioned above (though in a
different order). The Consumer group was also very consistent with the population perspective,
except for the barrier Compatibility which ranked 7th in the Consumer group. This is well
expected, since the category is more relevant to the Restaurant group, referring to how well the
container and system suits the food, operations and activities of the restaurants. Meanwhile,
the consumers’ concern towards the product’s compatibility with their daily activities was more
largely expressed in the Convenience barrier category.
The Expert group (which had only 1 respondent) was the only group to have a different opinion
on the most critical barrier. While all other stakeholder groups had Cost benefit or Quality
control as their most important barrier, the Expert group had Environmental impact as their
top-ranking barrier. This was due to the fact that the expert repeatedly expressed her concern
about whether or not the reuse & return system would actually be more environmentally
sustainable than the mainstream single-use packaging system. Meanwhile, a majority of the
other respondents did not even mention this doubt, except for a couple of restaurants who are
already very conscious about their environmental impact and have a reputation for being a
sustainable business.
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Table 9 Global rank of barriers mentioned overall
Global rank Barrier
1 Cost benefit
2 Quality control
3 Convenience
4 Niche market
5 Compatibility
Table 10 Rank of barriers mentioned per stakeholder group
Rank Expert %* NGO %* Customer %* Restaurant %* Courier %*
1 Environmental
impact
23% Cost benefit 26% Quality
control
31% Cost benefit 18% Cost benefit 50%
Niche market 26%
2 Cost benefit 15% Convenience 16% Convenience 23% Quality control 14% Convenience 33%
Convenience 15% Quality control 16%
Compatibility 15%
Liability 15%
3 Limited resources
8% Compatibility 11% Niche market 15% Niche market 13% Limited resources
8%
Quality control 5% Quality
control
8%
4 Environmental
impact
5% Cost benefit 13% Convenience 12%
5 Complexity 5% Compatibility 11%
Liability 5%
6 Limited
resources
4% Impact on
brand
10%
7 Compatibility 1% Limited resources
6%
Impact on
brand
1%
Novelty 1%
8 Complexity 4%
Environmental
impact
4%
9 Scale of
business
2%
Liability 2%
Novelty 2%
10 Accessibility 1%
Systemic lock-
in
1%
*shows the percentage of total mentions per stakeholder group (eg. in the expert group “environmental
impact” was mentioned 3 times out of 13 mentions of all barrier codes, hence 3/13 = 23%)
Table 9 summarizes the top 5 barriers that were most mentioned by all five stakeholder groups,
while Table 10 summarizes all mentioned barriers per stakeholder group and the order of
significance (the lower the number in the column “rank”, the higher the frequency of mentions).
The global top 5 barriers were color-coded in Table 10 to match Table 9 in order to visualize
84
how the views differ between stakeholders and how they compare to the general perspective.
The significance of barriers in each stakeholder group is also pictured in Figure 10. Four
barriers were omitted in this bar graph: Scale of business; Accessibility; Systemic lock-in, and
Novelty, because there were minimal mentions of these barriers and would be insignificant in
the visualization of the graphic.
Cost benefit is the most significant barrier to all the stakeholder groups, implying that economic
viability is still of utmost importance to any business model. The Consumer/customer group
was the only one to have ranked it as low as 4th place. Meanwhile, all other stakeholder groups
placed it either at first or second place. This could be accredited to the fact that consumers
expect more utilities or values out of the food delivery system, such as the convenience that
the service provides and the satisfaction they get from high-quality products and services.
Therefore, besides expecting a good economic deal, consumers are also highly concerned with
the quality of the product and whether or not it makes their lives more convenient. Indeed, there
are many things within the aspect of Quality control that were significant concerns for the
consumers, namely Hygiene and Quality control of the container. Because it is linked to food,
hygiene and cleanliness of the container became a large concern for consumers. Lack of
hygiene would lead to health risks, which is even more evident in the Covid-19 pandemic era.
Lack of trust towards SMEs (regarding their compliance to hygiene standards and quality
control capabilities) and concern regarding how well the quality of the container is maintained
in the context of extensive sharing between strangers also contributed to this. Convenience was
the second-most significant to consumers, which implies that practicality is high on their list
of priorities. However positive they perceived the innovation, the fact that it is less practical
than the mainstream model becomes a large disadvantage in the consumers’ perspectives.
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Figure 10 Bar graph showing the significance of barriers per stakeholder group
The Cost benefit barrier was most prominent in the Courier group. The interviews conducted
were too short to obtain background detail regarding the couriers’ experience working as an
online “ojek” (the Indonesian term for motorbike taxi) driver which could help further explain
the motives behind their responses. Nonetheless, a research study by PRAKARSA, an NGO in
Indonesia supporting social welfare improvement, discussed the issues behind the popularity
of these informal urban transportation workers (Afrina et al., 2017) which provide a reasonable
basis for this study. Basically, this occupation is an informal, time-consuming job with high
income uncertainty. Even though their employment with large tech companies (in Indonesia,
these are Gojek and Grab) is supposed to give them more stable income with high flexibility
in working hours, these drivers often have to work longer hours and at irregular times in order
to achieve better pay and bonuses. Operational costs such as fuel, maintenance of their vehicle,
and mobile phone credit also present burdens to ojek drivers, who already have a hard time
earning decent income to begin with (Afrina et al., 2017). These factors could explain why
Cost benefit was the primary concern for couriers, followed by Convenience.
In the Restaurant group, Cost and benefit was also the most significant barrier, but not by a
large difference compared to the other barriers. In fact, the six most significant barriers
according to the Restaurant group had relatively similar frequencies, only ranging between 10-
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Expert NGO Customer Restaurant Courier
Significance of barriers per stakeholder group (10 most important barrier categories)
Cost benefit Convenience Complexity Compatibility
Limited resources Liability Environmental impact Quality control
Impact on brand Niche market
86
18% out of the total mentions. This stakeholder group also had more variety of barriers
mentioned than in any other stakeholder group. This implies that there is a large set of criteria
and requirements that the business model must meet in order to attract restaurants’
participation.
The frequency of barriers mentioned between the Jakarta and Bali respondents are compared
in Figure 11 to analyze whether there are regional differences. The main difference between
the Jakarta and Bali customers lies in the barrier categories Convenience and Quality control.
Jakarta customers give much more significance to Convenience than the Bali customers, with
twice as many mentions. This could be linked to the explanation that Jati (2021) gave about
urban architecture. He mentions that Bali is a more walkable city; meanwhile, Jakarta is
characterized by traffic congestion and heavy pollution, which in turn makes it even more likely
for people to indulge in fuel-intensive, emission-heavy activities (commuting with personal
cars, frequent use of air conditioner, etc.). It creates a vicious circle of the urban heat island
effect. The urban heat island effect refers to the high heat content occurring in large cities due
to anthropogenic activities (power generation, vehicles, air conditioners, etc.) and dense
distribution of complex urban built structures, which further traps heat and warms up the
environment (Rizwan, Dennis and Liu, 2008). This could explain the different attitudes
between Jakarta and Bali customers when asked about the return mechanisms of the reuse &
return model. Three options were presented to the respondents: return directly to any retail
partner, return via the delivery courier on your next order, or return via the delivery courier but
through package delivery service. Most Jakarta customers immediately dismissed the first
option, with arguments such as:
“For me, I’d choose to return upon my next delivery. Because we order
(food) online for the sake of making things easier for ourselves and so we
don’t have to go out to get food, even if it's nearby.” – Febri (Customer,
Jakarta)
“My comment on the first option, to return it yourself. The problem is that
returning to the place yourself will probably require more transportation
costs…In my opinion, the reason we order GoFood (online food delivery
service by Gojek) is because we don’t want to go out. Then what’s the point
if we end up going out just to return the container?” – Aji (Customer,
Jakarta)
87
Meanwhile, Bali customers were more open-minded to the idea of returning the container by
themselves, with all five respondents saying that they would prefer to choose that option rather
than having to pay for additional collection service or wait for their next delivery order.
“…even with the pandemic, I still leave the house every once in a while.
And anyway, whether it’s merchant A, merchant B, we can return the box
anywhere. Surely there will be a lot of merchant merchants around my
house where I can return my boxes to. So, it doesn't seem too problematic.”
– Radit (Customer, Bali)
“So maybe, out of these three options I prefer to return the container by
myself. Because there are Gojek/Grab merchants everywhere, right? There
are many near my house. I can just go out and run other errands and
return it on my way. No problem.” – Maudy (Customer, Bali)
Figure 11 Bar graph showing the significance of barriers for customers and restaurants: Jakarta vs. Bali
In contrast to Convenience, Quality control was mentioned much more times in the Bali
customer group than in the Jakarta group. The subcategory Halal & non-halal is primarily the
reason for that (though there were also more mentions of subcategories Hygiene and Trust in
Bali customers than in Jakarta customers), as there were three mentions in the Bali group. In
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Customer, Jakarta Customer, Bali Restaurant, Jakarta Restaurant, Bali
Significance of barriers for customers and restaurants per region
Scale of business Cost benefit Convenience Complexity
Compatibility Accessibility Limited resources Liability
Environmental impact Quality control Impact on brand Systemic lock-in
Niche market Novelty
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contrast, the Jakarta group did not mention it at all. The subcategory Halal & non-halal refers
to the need to differentiate the cooking utensils and serve ware (sometimes even the whole
restaurant itself) used for halal and non-halal food and beverages. Halal certification for food
and beverage is indeed important in Indonesia, where the population is predominantly Muslim.
Yet the Halal & non-halal barrier was only mentioned in the Bali group, where Muslims (at
13% of the Bali population) are actually a minority compared to Hindus (83% of the Bali
population) (BPS Bali, 2018). This is because perhaps the Jakarta residents are used to “halal”
being the default since Muslims comprise3% of the Jakarta population (BPS DKI Jakarta,
2020); hence there is no need to question it anymore.
The main barriers identified also have several overlaps with each other. Table 11 shows the
matrix of code relations extracted using the MAXQDA “Code Relations Browser” function.
From this data, we find the barriers with the most overlaps are:
• Cost benefit and Consumer/market preference
Mostly implied by restaurants, that they expect the reusable-returnable model will be
more costly in terms of operations meanwhile, the added costs will most likely lead to
increased food prices as well, which in turn would change their target market, which
would again lead to more expenses.
“As for me, so far, as long as it doesn’t change the target market. Every
company has a market, right? Which market do you want to target? As long
as it doesn't change the target market, in the sense that it doesn't have a
significant impact on the target market, I'm okay. But if it turns out to
change the target market, it will definitely be affected in terms of costs.
Because for entrepreneurs, it is only a matter of profit and loss.” – Teensy
Canteen (Restaurant, Jakarta)
• Hygiene and Trust
Mostly implied by customers, that they have concerns whether or not all actors in this
reusable-returnable system can be truly be trusted to maintain high standards of food
safety and quality in general.
“I am concerned about the hygiene. Even though there are established
standards of hygiene, but who would be the police to make sure it really is
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clean, you know? What if there’s a rebel merchant and they don’t follow
the instructions?” – Sanny (Customer, Bali)
• Cost benefit and Convenience
Usually, with increased impracticality comes more costs which is especially true for the
couriers.
“See, we are paid for one trip of delivery. Then if we return the container,
that means there is a charge for the (additional) trip as well. When we
finish an order, we finish a task. Then immediately we get other orders. If
we have the additional task of returning the container, then it’s like we
have 2 points (of travel), not just the 1 point where we have to deliver and
finish the task… (the customers) will automatically get charged. Because
we will also need gasoline for that.” – Courier #5
• Cost benefit and Concern for the environment
Typically implying that the pragmatic benefits must be clearly communicated to
potential users who are less inclined towards pro-environmental consumption. The
costs related to sustainable or circular products/services are typically higher than those
of conventional alternatives. So, in order to engage a wider audience, especially those
who are on the lower end of environmental proactivity, the more tangible benefits
(savings, profits, utility) should be emphasized.
“So, in the beginning to form habits and invite people, they must know
what the benefits are for them and the benefits must be pragmatic. When it
comes to environmental idealism, inviting ordinary people, most of them
already understand, but there is no guarantee that it will change their
behaviour unless the people are already at the next level and are willing to
care. Often times it’s like that” – PlastikDetox (NGO)
The following sections will elaborate more on each of the categories. However, four categories
are left out due to very low frequency of mentions therefore implying that they are not such
significant barriers to the stakeholders: Scale of business, Accessibility, Systemic lock-in and
Novelty.
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Table 11 Matrix of code relations: Barriers
Code System (Barriers)
Sca
le o
f busi
nes
s
Cost
ben
efit
Conven
ience
Com
ple
xit
y
Com
pat
ibil
ity
Acc
essi
bil
ity
Lim
ited
lab
or
Lim
ited
sto
rage
spac
e
Lia
bil
ity
Envir
onm
enta
l im
pac
t
Qual
ity c
ontr
ol
of
pac
kag
ing
Tru
st
Hygie
ne
Hal
al &
non
-hal
al
Bra
ndin
g
Rep
uta
tion
Sta
ndar
ds
and r
egula
tion
Urb
an p
lannin
g
Lac
k o
f su
pport
fro
m o
ther
sta
keh
old
ers
Conce
rn f
or
the
envir
onm
ent
Consu
mer
/mar
ket
pre
fere
nce
Educa
tion/C
om
munic
atio
n
Novel
ty
Scale of business x 3 0 0 0 0 0 0 0 0 0 0 0 0 1 0 0 0 0 0 0 0 0
Cost benefit 3 x 5 3 3 0 1 0 1 0 0 0 1 0 0 0 0 0 0 5 6 0 2
Convenience 0 5 x 1 1 0 0 3 0 1 3 0 0 0 0 0 0 0 0 3 1 0 1
Complexity 0 3 1 x 0 0 0 1 0 0 1 0 0 0 0 1 0 0 0 0 0 0 0
Compatibility 0 3 1 0 x 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Accessibility 0 0 0 0 0 x 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Limited labor 0 1 0 0 0 0 x 0 0 0 1 0 0 0 0 0 0 0 0 0 1 0 1
Limited storage space 0 0 3 1 0 0 0 x 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0
Liability 0 1 0 0 0 0 0 1 x 0 0 3 2 0 0 2 0 0 0 0 0 0 0
Environmental impact 0 0 1 0 0 0 0 0 0 x 0 0 0 0 0 2 0 0 0 0 0 0 0
Quality control of packaging 0 0 3 1 0 0 1 0 0 0 x 2 3 0 0 0 0 0 0 0 0 0 0
Trust 0 0 0 0 0 0 0 0 3 0 2 x 6 0 0 1 0 0 0 0 0 0 0
Hygiene 0 1 0 0 0 0 0 0 2 0 3 6 x 2 0 3 0 0 0 0 0 0 1
Halal & non-halal 0 0 0 0 0 0 0 0 0 0 0 0 2 x 0 0 0 0 0 0 0 0 0
Branding 1 0 0 0 0 0 0 0 0 0 0 0 0 0 x 0 0 0 0 0 0 0 0
Reputation 0 0 0 1 0 0 0 0 2 2 0 1 3 0 0 x 0 0 0 0 0 0 0
Standards and regulation 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 x 0 0 0 0 0 0
Urban planning 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 x 0 0 0 0 0
Lack of support from other
stakeholders
0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 x 0 0 0 0
Concern for the
environment
0 5 3 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 x 2 0 1
Consumer/market
preference
0 6 1 0 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 2 x 0 1
Education/Communication 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 x 0
Novelty 0 2 1 0 0 0 1 0 0 0 0 0 1 0 0 0 0 0 0 1 1 0 x
6.2.1. Cost benefit
The barrier “Cost benefit” refers to the balance of costs and benefits expected from this new
business model, most often implying that the costs will outweigh the benefits. The benefits are
generally perceived to be more intangible (environmental conservation, sustainable
consumption, etc.), hence providing a stronger case for “costs” over “benefits”. The general
idea is that the reuse & return model will incur more costs to the respondents’ day-to-day
operations or activities. For restaurants, the increased costs are mainly linked to additional labor
and equipment needed to keep control and have the boxes sterilized correctly. For couriers, it
is connected to the need for more fuel and parking charges, on top of the expected pay for their
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additional services to begin with. For customers, it is mainly about having the extra cost for the
container itself (even in a deposit-refund scenario), then also about the transport costs incurred
when they have to return the container themselves.
“But if it turns out to change the target market, it will definitely be affected
in terms of costs. Because for entrepreneurs, it is only a matter of profit
and loss. Because if it's a business, you see how much profit it makes, only
when it becomes a big company, then maybe the business can think about
what they could do for the surrounding community from the profits. For
Teensy Canteen, we haven’t reached that point yet. From our side, are
there any financial benefits to be gained from this program?” – Teensy
Canteen (Restaurant, Jakarta)
“Because, for example, I sell food, the price is Rp25,000-Rp28,000. So, my
market segment are college kids or young employees, not premium ones.
But just sending the container back and forth like that, if the restaurant is
doing it, it means the price will be expensive to the customer. Now first
things first, who would want to bear it? That means it's either the customer
or even, the restaurant or the firm… I don’t find it interesting, from the
restaurant or the customer’s side when they eat only Rp25,000. In terms of
economic value, I still don’t see this as economic.” – Nyapii (Restaurant,
Jakarta)
“The impact on the cash flow would be quite bad, if I have to provide more
people and provide a certain room or storage to handle this. So this is the
new model, meanwhile the market is still not very interested. Maybe if it's
already running for some time, it becomes normal, then it’s no problem.
For the current condition though, yes it would be difficult.” – SABO
(Restaurant, Bali)
“It's just that maybe because there is a risk of me losing it, having it slip
somewhere that I don’t know. Then perhaps I’ll get a penalty, or have to
pay for a compensation, or I don’t get the deposit is back. It’s with all those
considerations that I’d rather not do it.” – Aji (Customer, Jakarta)
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“For example, if there's more costs for the delivery, then maybe we’ll just
follow along the company’s instructions and regulations. We'll do it. But if
there are no rules, no obligations about it, we will be burdened.” – Courier
#1
A small number of respondents (one NGO, three restaurants, and one customer) did however
note that having a circular system should lead to smaller investment costs because the need for
supplying new food packaging is reduced. Although the case presented was that the firm would
provide the containers for free to the restaurants (noting that the restaurants would be obligated
to wash the containers), it is worthy to note that presenting a considerably lower capital cost
for the long term is substantial in gaining positive feedback from restaurants.
“From the consumer's point of view, by returning it, he should be able to
get cheaper food. Because the restaurant doesn't have to pay for the
package anymore.” – Teensy Canteen (Restaurant, Jakarta)
“As long as it’s a good program and it’s run well. Then the third, it can
reduce the cost from all the single-use packaging I buy for my restaurant.
In this model, I wouldn’t have to spend more money on the boxes, right?
Because it will be given by the company.” – Sabo (Restaurant, Bali)
“…if we can use this reusable container, will it be able to get us food at a
cheaper price or not? Because those who are selling won't need to spend
money on packaging like usual, the Styrofoam box, or paper box.” – Radit
(Customer, Bali)
One respondent, an NGO representative, mentioned that the financial model and cost-benefit
consideration is a crucial part of designing this system. She notes that the cost must neither be
too expensive, which will discourage people from trying, nor too cheap that customers won’t
bother to return the container to the system. This statement indeed corresponded to Jati (2021)’s
remark that CupKita has a low return rate of only 30%, due to the fact that customers feel that
their price is a good deal for a coffee cup compared to those sold by large brands such as
Starbucks.
“Because this is a container for reuse and of course because of the
branding of a restaurant or the company, we want to use a good material
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to show the characteristics of the business. But people here really like to
collect souvenirs (so that they keep the “pretty things” for themselves)…
there must be an initial deposit that is larger… So, there must be something
that can motivate people to return the container. And not being careless, so
that customers feel ‘Oh, it’s only Rp20,000 for the container, we can just
keep it, it’s not bad, right?’” – PlastikDetox (NGO)
6.2.2. Convenience
The barrier “Convenience” was often mentioned to express the expected impracticality
imposed by the reuse & return system. A range of different contexts was mentioned. The
restaurants assumed there would be more effort needed to manage operations in the restaurant,
especially in regards to maintaining the flow of containers, washing them, storing them. An
NGO representative noted that introducing a new system into a professional kitchen might be
difficult as it disturbs their usual working rhythm.
“Because this is the reality if you ever enter a professional kitchen in a
restaurant, the rhythm is very fast. The washing, the cooking. They can't
operate if the packaging or something else disturbs the rhythm of their
work in the kitchen. It simply won't be used. And solid containers like this,
if you throw them around, stack them, the washing is rather messy because
one of the easiest methods of washing is soaking everything first.” –
PlastikDetox (NGO)
“For example, the plastic for the drinks, it can be washed again, can be
returned again. But we never tell them that it could be returned back
because it would be a hassle to wash it, meanwhile plastic is cheap. We buy
them for around Rp600. So, between returning Rp500-600, but it is
complicated to wash it, have to dry it, you have to be ready to use it again...
It seems like it is even less practical and more expensive than throwing
away with each use.” – Teensy Canteen (Restaurant, Jakarta)
“It's not that we don’t have people to help us wash the boxes. It’s just,
impractical.” – Dapoer Papa (Restaurant, Bali)
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For the customers, it was more about the additional effort going into each transaction and
difficulty in regards to washing and returning. Meanwhile, for the couriers, simply having the
additional task added to their daily assignments presents a problem in this aspect.
“And maybe I would be willing to do it if I was at home. As long as there is
one place where I can wash the container, you know? But maybe if I’m at
the office, maybe it seems like a bit of a hassle. We’d have to go find the
sink, is there a place for us to wash the dishes?” – Tina. (Customer,
Jakarta)
“Only maybe later, it will be a consideration: how big is the box. Is it in
only one size, does it have several different sizes? Will it be stackable or
not? I don’t want the boxes to pile up and make my house look like a
scavenger’s warehouse. Boxes everywhere. Not to mention how
complicated it would be to bring the boxes along to return them. Can you
imagine carrying 10 boxes, with everything else you carry with you, plus
the boxes that you need to return.” – Sanny (Customer, Bali)
Respondents from all but one stakeholder group (the Courier group) mentioned that this new
system presents a much more impractical flow than what customers are currently accustomed
to. Some respondents highlighted the fact that customers order food delivery through online
platforms because it satisfies their needs (or wants) for a wide selection of ready-made meals
without the hassle of leaving the house or office. With this reuse & return system, customers
are presented with the obligation to wash and return the containers, which was found to
contradict the initial concept of convenience that online food delivery promises.
“And the idea that they need to return the container by themselves is a bit
contradicting with the idea of online food delivery. Why people buy online
is because they don’t want to go out in the first place.” – Maria Dian
Nurani (Sustainability Expert)
“People just want easy, you know? So, they order from (online food
delivery services) because you know, they don't want to go out or they
haven't got time.” – Dapur Deli (Restaurant, Bali)
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“Perhaps these two options, you could say, make the process less practical
than ordering food now, right? So you’d need a market or people who
really love the environment so they are willing to take part in this, who
would be willing to be bothered to think about these 2 ways. This is far
more impractical than what we have now, that we just have to throw away
the container.” – Aji (Customer, Jakarta)
The many highlights of practicality expressed by respondents were also reflected in the
CupKita interview, where Jati (2021) stresses the urgency to find seamless solutions to increase
acceptance.
“The customers are not lazy, but rather they want a system that is
straightforward. That they don't need to think to use it. You don't have to
think much about it, and you get immediate benefits. So that's what we
learned from our experience.” – CupKita, Jati (2021)
6.2.3. Complexity
The barrier “Complexity” is used to imply that in order to apply the reuse & return system, the
users would have to go through an intricate process with many components that make it
complicated. The system requires that customers have to think about more cost components:
the food itself, the delivery service, the use and return of the reusable container, hence imposing
more thought processes with each transaction.
“.. like it or not there are three thought processes that we, as customers,
have to go through, and that’s more than what we’re used to. Because now,
when we order food, we consider the price of the food and the transport
fee. Now there is a price for food, there is a transport fee and at the same
time also a price for the container. Though there is a deposit system. But
will this be able to attract the public's intention to join this scheme, if there
are three thought processes that they have to go through?” – Aji
(Customer, Jakarta)
From the restaurants’ perception, the system also presents a complex supply chain. Concerns
expressed by restaurants mainly focus on how the redistribution works, what happens when
they run out of inventory, and the way they have to adjust operations in their kitchen.
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“Well first of all, the containers will be prepared by the company, right?
So, how much should the merchant have in stock? And if we run out of
them, should we notify the company to give us a restock, or should we just
wait for customers to make a return? The payment system must also be
clear. Point is, make the system as simple as possible.” – Warung Kecil
(Restaurant, Bali)
“Then if you mistake the container for another, you can use it in the kitchen
for other purposes. That's a real headache for our operations. I would think
that we keep a pretty tidy kitchen. And even so, I get dizzy just thinking
about the operational requirements for this scheme.” – Bali Buda
(Restaurant, Bali)
6.2.4. Compatibility
The barrier “Compatibility” mainly addresses problems faced by the restaurants. First of all,
restaurants are concerned about the universal container that will be shared among different
brands. Even in just one restaurant, the food may come in different portions so that the
restaurant would provide different sizes and shapes of takeaway/delivery containers. It’s not
merely a problem of whether the food fits or not, but also whether it allows the restaurants to
present their food in the right aesthetic or style. Hence, a primary concern for some restaurants
was how well the single design could suit the needs and style of different restaurants. Other
than that, there is the concern that the restaurants need to adjust their operations or menu
accordingly to be suited to the system.
“…maybe from the various merchants, the container requirements can be
very different. For example, maybe one food has a lot of liquid, so maybe
he can't use it ... Maybe he needs a container that looks like a bowl.
Compared to other merchants who may only need flat containers, then he's
okay…Then how much do we have to adjust the menu or our food for us to
be able to use this container, it must also be a consideration… Maybe for
certain merchants the adjustment is greater than other merchants. Will we
get incentives, or support at the beginning for this?” – Tangerine Kitchen
(Restaurant, Jakarta)
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“Then the second thing I am most concerned about is, the portions of each
food are different. So, for example, I sell satay. If the box is big, I’m afraid
if when the customer opens it, he’ll think ‘how come it's empty?’ so it's not
worth buying from my restaurant.” – SABO (Restaurant, Bali)
6.2.5. Limited resources
The barrier “Limited resources” refers to having limited space and labor which make it difficult
to handle or manage the flow of the reusable containers. This barrier applies not only to
restaurants but also to customers (in that they don’t want to have the reusable boxes piling up
and making a mess in their homes) and couriers (that they have limited space on their vehicles
to carry them in between trips). Nonetheless, this barrier is voiced more often in the restaurant
group, emphasizing that extra space is needed to store the reusable boxes in comparison to
stackable and/or foldable single-use food packaging which are quite space-efficient.
“…definitely it’s a problem, because the paper packaging we have right
now, we can easily store and use. And these boxes you have, they don’t
seem stackable, do they? Especially if we need many. And our space is a bit
limited too.” – Nyapii (Restaurant, Jakarta)
“No, I can't. Because, for example: the capacity area of a good kitchen is
30% of the building area. This means that if the building is 100 meters,
30% is 30m2, is that right? 30 M2 is just the kitchen. That means we need
maybe around 10 M2 for storage and other places, that's already used up.
We definitely can’t.” – Manggis (Restaurant, Bali)
6.2.6. Liability
The barrier “Liability” refers to the uncertainty of who is responsible for damage or
deterioration of the food container quality, which makes people hesitant to try. It is voiced
mainly by restaurants and customers. It is expected to invoke conflict, for example, if one actor
neglects their responsibilities and mishandles the reusable container (and food) and the other
takes blame for it.
“But still someone has to press the button and decides, ‘okay, the container
has been received back.’ For example, is the refund the same if the
container returns intact and if there is a slight damage or leak? It should
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be different. But then people could be throwing the blame on each other.
It's really risky from the customer service point of view, and the after sales
service, it's risky, isn't it?” – Maria Dian Nurani (Sustainability Expert)
“One thing for sure, we’re afraid of running out of boxes when we need it.
Most of the time customers get directly linked to the restaurant, right? So,
they don't want to know what's wrong, if there are no boxes, what do they
care? But of course, the fault will be ours, the restaurants. All the
customers know is that we don’t have any boxes and it’s taking a long time.
Then eventually it will give off a bad impression on our restaurant, right?”
– Nyapii (Restaurant, Jakarta)
“What happens when someone neglects their responsibility? Say the
courier didn’t pay attention to the quality of the box when he accepted it.
Then if we said that there was something damaged, the courier could deny
it "No, it was fine when I accepted it." Something like that could happen, it
could cause a problem. Or maybe even that the number of containers could
be different.” – Bali Buda (Restaurant, Bali)
6.2.7. Environmental impact
The barrier “Environmental impact” refers to the concern that this new system of reuse & return
would actually have a more significant environmental impact than the dominant system of
single-use packaging, hence becoming a reason for doubt to some respondents. Three
respondents were particularly vocal about this barrier: the sustainability expert and two
restaurants. The main concerns were regarding increasing emissions from motorcycle transport
of the couriers in returning the containers and increasing water usage in restaurants to clean the
reusable containers.
“Does it make sense that we’re making the couriers ride his motorbike
back and forth to deliver and return the containers? In fact, in addition to
the cost…there will also be emissions coming out of the vehicles. Is all of
that worth it?” – Maria Dian Nurani (Sustainability Expert)
It is important to note that the two restaurants that voiced this concern have branded themselves
as sustainable and environmentally conscious businesses. One is a vegan restaurant, while the
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other is known for their eco-friendly packaging (using only biodegradable paper boxes and
banana leaves as an additional layer, as well as reusables like glass jars for soups). They were
both concerned about the washing phase, indicating that there will definitely be an increase in
water consumption and waste from dish soap which might be hazardous to the environment.
The topic of water consumption is crucial to note, as Bali Buda mentions, due to the Bali water
crisis.
“Then we have to add soap. We throw away the soap, it becomes waste.
It’s just the same, going round and round. Unless the company says, ‘I’ll
give you the food boxes that can be used many times, then I’ll give you eco-
friendly soap that’s ecologically very safe. So, wherever you throw the
waste, it will not damage the ecosystem nor the river.’ Oh, I would love to
have that. But at the end of the day, if we wash more, we use more
detergent, then it is the same.” – Manggis (Restaurant, Bali)
“Yet we already know that Bali has a water crisis, so now they wash it
instead of just throwing it away... That's double washing. By the
consumers, then by the merchants as well. So, which is more important,
water or replacing plastic? Using plastic is completely fine, as long as it's
not single-use plastic, and it has to be recyclable. But the problem of
washing, this will consume a lot of water, twice as much” – Bali Buda
(Restaurant, Bali)
6.2.8. Quality control
The barrier “Quality control” is a combination of four other barriers as its subcategories, in
order of most mentions: “Hygiene”, “Quality control of packaging”, “Trust”, and “Halal &
non-halal”. These four subcategories were found to have similar content and oftentimes
correlated to one another, therefore relevant to be categorized under one general barrier.
“Hygiene” refers to the respondents’ concern towards the fulfillment of food safety and
cleanliness standards. This barrier was mentioned at least once by all stakeholder groups but
most prominently voiced in the Customer and Restaurant group. The hygiene issue is even
more amplified with the Covid-19 pandemic, as governments and the public itself are more
conscious of and demand utmost careful measures regarding cleanliness of food, utensils, and
facilities in general.
100
“And if we’re talking about the pandemic, why would people want to
exchange boxes with other people? Meanwhile a lot of people are afraid if
the virus sticks to the food boxes.” – Bali Buda (Restaurant, Bali)
“The second is hygiene, because the system you’re describing fits a normal
situation. But in this pandemic situation, there may be many requests for
stricter standards related to hygiene. Whether it's from the market itself or
maybe government regulations.” – Aji (Customer, Jakarta)
“Quality control of packaging” refers to the concern of how the quality of the reusable container
is monitored and maintained. This barrier was mentioned in a range of contexts, from the
possibility of damage during use by customers or restaurants, the need to monitor the number
of uses, and control of quality between all users.
“Usually for rantang (traditional catering), if the food has a lot of spices,
then if it is not immediately washed, even though it is washed later, it will
leave its smell. There are certain odors, and the more it is repeated, the
more the odors will stay. But that depends on the material, I guess.” –
SABO (Restaurant, Bali)
“There is a real risk of having the boxes be damaged…Moreover, we often
use this here for stock in the kitchen. Big and small, we use them a lot. If it
falls, it easily breaks. So, it's not long-lasting. Depending on the material,
of course.” – Warung Kecil (Restaurant, Bali)
“As simple as this, maybe the rubber is missing on this silicone box lid.
Anyway, there must be three people to agree that the goods are fine. The
one who sent it, the courier, and the one who received it. If that's not clear,
it might become a problem eventually.” – Bali Buda (Restaurant, Bali)
“Trust” refers mainly to the possibility of deceptive acts by another actor within the system.
For example, it was mentioned several times in the context of hygiene, but it was also
mentioned in the context of fraud.
“Then say, if you want the container to be returned, it has to be unique,
right? It has to be different than the average containers. Otherwise, people
could claim that they want to return the container, when in reality it’s their
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own container completely separate from the product you’re providing.” –
Maria Dian Nurani (Sustainability Expert)
“Halal & non-halal” refers to the concern that containers serving non-halal food might be
mixed with those serving halal food. Meanwhile, as a Muslim-dominated country, halal and
non-halal separation is often an essential aspect of culinary services.
“I was thinking about hygiene at the beginning. If, for example, there is no
strong branding and image, it will be very easy to get an issue like ‘Wow,
this lunch box was used to eat pork, now it is mixed into a Muslim place’ so
it becomes problematic” – Radit (Customer, Bali)
6.2.9. Impact on brand
The barrier category “Impact on brand” consists of 2 subcategories: “Branding” and
“Reputation”. These barriers were mentioned mainly by restaurants, though it was also
mentioned by one consumer, but also through the perspective of the restaurants.
“Branding” refers to the concern that having a universal design for the reusable containers will
limit the restaurants’ opportunities for marketing strategies and advertising their brand, e.g.,
through the printing of their logo or having a unique packaging design.
“Usually, entrepreneurs have some form of branding that they want to
display on the packaging itself. And this branding is usually printed
directly on the packaging or by putting stickers on the packaging… Maybe
in terms of branding, you need to rethink what kind of system you’ll apply.
What will allow the restaurants to display their brand, but at the same time
using packaging that is universally used for any restaurant.” – Teensy
Canteen (Restaurant, Jakarta)
“To me, the branding aspect will be difficult. The Bali Buda box and
packaging is our signature thing. That’s where we place our brand image.
In this system, where will I do my branding?” – Bali Buda (Restaurant,
Bali)
“Reputation” refers to the concern that any mishaps throughout the system's operation will
negatively impact the customers’ perception of the restaurant. This is connected to the
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possibility of delays in the distribution of reusable boxes, which may affect the delivery time
of the restaurant, and the risk of contamination, making the restaurant seem careless about
hygiene when there may be other variables outside of the restaurant’s control.
“…if there are no boxes, what do they (the customers) care? But of course,
the fault will be ours, the restaurants. All the customers know is that we
don’t have any boxes and it’s taking a long time. Then eventually it will
give off a bad impression on our restaurant, right?” – Nyapii (Restaurant,
Jakarta)
6.2.10. Niche market
The barrier category “Niche market” consists of three subcategories, in order of most mentions:
“Concern for the environment”, “Consumer/market preference” and
“Education/communication”. These three barriers were found to be the cause of the market
being a very small niche. All stakeholder groups mentioned them except the Courier group.
“Concern for the environment” refers to the lack of environmental awareness, pro-
environmental attitude, intention, and action in (mostly) customers, which will make it
challenging to find support for a reuse & return system.
“But if, for example, there is a charge on the container, it is likely that the
consumer will not choose that. Better to stick to the usual rather than pay
for a container that’s eco-friendly. Because not everyone cares about the
environment.” – Diah (Customer, Jakarta).
“…in Indonesia, we know that the percentage of people who are
environmentally conscious... maybe only a very small percentage. Not that
it's impossible, they can grow from 1% to 2%, 3%, 4%. That is why a
gimmick is needed at least to be able to make these people aware and
attracted and they will at least get the direct benefit. ‘What is the benefit of
me doing this?’ If he is not aware of the environment, at least he is aware
that his money can come back again. There is an impact.” – Teensy
Canteen (Restaurant, Jakarta)
“I don't know, lots of people are very conscious about plastics that they
want to do that, but then when it comes to giving out money for it. I don't
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know if customers will be happy to pay… And I know it's a deposit and
they'll get it back. But it might put some people off.” – Dapur Deli
(Restaurant, Bali)
“Consumer/market preference” refers to the low demand for green products and services in the
Indonesian consumer market, hence making it difficult for businesses to opt for more
expensive, sustainable alternatives. This barrier is also linked to the fact that restaurants have
their own target market segment, which they would prefer to stay the same. Some restaurants
voiced their concern that by participating in the reuse & return system, their price points will
increase, changing the market segment, which is seen as a negative thing.
“Secondly, I don't know if this will drive sales growth. Maybe it could,
maybe because ‘Oh Nyapii is supporting an environmental cause’, which
could ultimately make our restaurant’s brand even better. Maybe people
would go, ‘Oh, I want to buy Nyapii because they support the
environment.’ But I'm afraid people just don't care. If we have to pay the
cost for this, meanwhile no one is interested, then it’s useless if we don’t
gain more sales from it.” – Nyapii (Restaurant, Jakarta)
“As for me, so far, as long as it doesn’t change the target market. Every
company has a market, right? Which market do you want to target? As long
as it doesn't change the target market, in the sense that it doesn't have a
significant impact on the target market, I'm okay. But if it turns out to
change the target market, it will definitely be affected in terms of costs” –
Teensy Canteen (Restaurant, Jakarta).
“Education/communication” refers to the concern that environmental issues and urgency of
action to mitigate environmental problems are not well-communicated, as well as the
possibility of miscommunication getting in the way of gaining more participation of
customers/restaurants.
“Then the second is the communication to customers about them having to
clean the boxes themselves. Hoping that they would clean it is too
ambitious, especially since, for most people who do takeaway or order
their food to be sent home, one of the reasons for that is not wanting to
wash dishes… So, if you use the words ‘clean’, ‘wash’ or all other kinds of
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things it can make people lazy to be asked to wash themselves even though
they already ordered (from a restaurant). So, you have to be specific.
‘Rinse’, that's enough because what you really want to avoid is not to let
the food dry out, so it gets rotten or difficult when washing it according to
hygiene standards. Rinsing should be enough explanation.” – PlastikDetox
(NGO)
“I’ve been given such plastic containers as well. I think it can be reused,
but I also doubt how many times it can be reused. So in the end, we don’t
really reuse it. Maybe because we don’t really understand whether or not it
can be reused. I mean, if you look at the container, it does seem like it can
be reused.” – Maudy (Customer, Jakarta)
6.3. Hotspots
Similar to the identification of barriers, the anticipated hotspots of the reuse & return model
were identified through empirical work: interviews and focus group discussions. The analysis
was based on the same database of transcripts as used in the analysis of barriers, but with a
different set of codes as listed in Table 7.
In this study, a hotspot refers to an element within the business process which holds a
significant activity that has a large impact on the overall business. It also signifies the
bottleneck or the part of the business process that is at risk of getting disrupted. In order to
identify the hotspots, the flow was first conceptualized and illustrated in Figure 12. The process
flow of the business model was divided into ten elements:
• Design and supply of container by the firm
• Inventory of container by the firm
• Storage and washing by the restaurants
• Order and payment
• Food preparation by the restaurants
• Delivery by the couriers
• Use and consumption by the consumer
• Reverse logistics (return)
• Repair
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• End-of-life management
Figure 12 Process flow diagram of the reuse & return system
Nevertheless, the qualitative analysis showed that only five elements were significant to the
stakeholders, as the remaining five had no mentions whatsoever during the interviews and
focus group discussions. The top most mentioned hotspots are listed in Table 12. Meanwhile,
Figure 13 shows the frequency of mentions of each hotspot according to the stakeholder.
Reverse logistics had the most mentions overall, with almost half of the total mentions of
hotspot codes being “Reverse logistics”. All stakeholders agree that this is a crucial element of
the business model which made them doubtful. Customers were not only concerned with the
impracticality of the mechanisms for returning the container (return by themselves or through
the courier), they were also worried about the risk of being held liable for damage of the
containers and being rejected by the courier or restaurant for the same matter. Restaurants were
mostly concerned that the return rate will be very low, hence putting them at risk of having
intermittence of container supply. Other than expecting a low return rate, restaurants were also
concerned about how the system will ensure balance in the redistribution of the containers after
the initial use. They noted the possibility of one restaurant being overloaded with container
returns, while another would receive low or no returns whatsoever. This implies that there
needs to be an additional element in the process flow of the reuse & return model, which
ensures equal, or rather proportional, redistribution of containers after the customers return
them. Couriers were also predominantly concerned about Reverse logistics because that is the
only part of the business model that, for them, is different than the current business model with
single-use packaging. They were concerned about not having adequate space on their vehicles
if they had the additional task of accepting the empty containers, meanwhile, they are already
carrying two helmets with them (one for themselves and an extra for the customer), and
sometimes they would take ride-hail orders where the customer would have their own
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belongings that take up much space on the vehicle. They also felt it would be a burden just to
have an extra “assignment”. One courier mentioned that having to accept the empty containers
from customers and having to return them to a restaurant would be a burden, simply because
of the additional task that would not be immediately crossed off their list (unlike taking direct
food delivery, parcel, and ride-hail orders) and that it would be “a waste of their time” that they
would have otherwise been able to use to take other orders. But ultimately, this depends on the
financial model and what benefits the firm could offer to the courier.
Table 12 Global rank of hotspots mentioned overall
Global rank Hotspot
1 Reverse logistics
2 Storage and washing by restaurants
3 Design and supply of containers
4 Use
5 Order and payment
Figure 13 Bar graph showing the significance of hotspots per stakeholder group
“As for us couriers, we’re just following along, it's up to (the firm’s) policy
and program. As long as we are given more rewards for taking and
returning the container, it's fine.” – Courier #4
The second-most mentioned hotspot, with less than 1/3 mentions overall, is Storage and
washing in restaurants. The statements are linked to two main causes. First the restaurants
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Expert NGO Customer Restaurant Courier
Significance of hotspots per stakeholder group
Design and supply of packaging Storage and washing in restaurants
Order and payment Use
Reverse logistics
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would have limited space to store the containers, since reusable containers are typically more
space-consuming than single-use containers which are usually stackable or foldable. Second,
and more often mentioned, not all restaurants can be trusted to follow the hygiene standards,
or it would be difficult to guarantee that quality standards (food safety, appropriateness in
regards to lifetime of the container) are fulfilled every single time an order is processed and
sent in the reusable packaging.
“Then the second is the problem of cleanliness too. Earlier you mentioned
that there is a lifespan for these containers. How do you control that? How
do you make sure that it’s not used when it has reached the end of its
lifetime? Because here, there are many kinds of merchants, right? From
SMEs to large restaurants…And how the cleaning procedure works is also
important. How do you control it? Okay, so you say there will be some
standard protocols. But that comes back to the merchants again, will they
abide by the protocols diligently or not?” – Maudy (Customer, Jakarta)
The Design and supply of containers by the firm is another hotspot considered important,
mostly by the restaurants and also the sustainability expert. This was closely linked to the
barrier Compatibility, because the arguments posed were mostly about how the containers must
be designed to suit the needs of the restaurants, meanwhile, each restaurant has its own style
and brand, which is usually reflected in the packaging size, shape, and material. The expert
also expressed the same concern, but she also noted that the material choice and where it is
sourced from would be a significant determinant of the total environmental footprint of the
system, hence in regards to ecological impact, this part of the model is crucial.
“We also have to know the product, right? Yes, it's the material. Where is
the factory, where is it being produced? Then if we opt for a plastic box,
there are a lot (of them) in the market, but not all of them are really of good
quality. So, it must also be considered how long this product will last,
especially when there will be a lot of hands handling them.” – Maria Dian
Nurani (Sustainability expert)
The Use phase is another significant hotspot but only mentioned by the Customer group. It was
not so much stated as a concern by the customers themselves. Rather, they saw the opportunity
to reuse the container for their own personal purposes before returning it back to the system.
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This might not seem like a huge problem, per se, since it might even promote the habit of
utilizing reusables instead of disposables. Nevertheless, the actual lifetime of the product
cannot be tracked accurately if there are multiple reuses that are not controlled by the system.
It could very well be that the containers show deterioration after much fewer uses than
anticipated, should these uncontrolled reuses occur extensively.
The Order and payment phase is a hotspot mentioned only twice (3% out of all mentions of
hotspots), once by a restaurant and another by an NGO. The restaurant was concerned with the
method of monetary flow for the reuse & return system, specifically whether the deposit and
refund model would be paid with cash or through digital wallet accounts. She noted that there
might be customers (like herself) who don’t use digital wallet accounts for the food delivery
apps. If the deposit-refund system is processed only through digital wallet accounts, it would
prohibit individuals who primarily use cash to participate in the reuse & return scheme. Most
respondents in the Customer group stated that they vastly prefer digital wallets to physical cash
due to their convenience and having more opportunities for discounts. However, two customers
in the Bali group said they still preferred cash. Since this study only involved a small group of
respondents, variance on this matter is still largely possible.
6.4. Stakeholder network analysis
Similar to the barriers and hotspots analysis, the stakeholder network analysis is predominantly
based on the empirical findings from interviews and focus group discussions. However, the
empirical findings were then combined with results from the literature research to provide a
more holistic view of the relevant stakeholder network. Figure 14 illustrates the final
conceptualization of the stakeholder network map that was based on the study findings. The
stakeholders marked with black-lined boxes are those mentioned by the respondents in the
interviews and focus group discussions. The stakeholders marked with blue-lined and -filled
boxes are those not mentioned within the empirical findings, but are adapted from literature
such as Freeman, Harrison and Zyglidopoulos (2018) and Bertassini et al. (2021).
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Figure 14 Stakeholder network map for reuse & return models of food packaging
Starting from the innermost part of the diagram shown in Figure 14, the firm is the central
entity which initiates the implementation of the reuse & return model. Drawing on existing
business cases, “the firm” is usually a start-up or impact-driven entrepreneur(s) who then
becomes the middle man for all the stakeholders in order to create a network for collaborative
consumption. Their main activities are: designing the system and product (the reusable
containers), reaching out to other entities to become their retail partners, connecting the primary
stakeholders to one another, and managing the distribution system, quality control, and
payment.
The second layer is the primary stakeholders, which directly impact the firm in terms of value
creation. The material and monetary flows are presented in the next section. The packaging
producer supplies the container and is also expected to provide repair services in order to
prolong the life of the products. The retail partners (primarily identified as restaurants) are the
first users of the product. After delivery by the couriers, the product is then used by customers
as the end-users. Existing food delivery networks/platforms act as the bridge for the firm to
scale up. If the firm succeeds in integrating itself into existing food delivery platforms that are
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already well-established, acceptance and expansion of the business might be easier achieved.
Otherwise, if a partnership could not be reached, this stakeholder group would become the
competition. Investors are, of course, important in providing capital to initialize or later grow
the business. Meanwhile, end-of-life management refers to recyclers and other forms of waste
management entities that ensure the appropriate disposal of end-of-life products.
The third layer is the secondary stakeholders. These groups indirectly impact the firm, but they
determine and shape the business ecosystem through applications of regulations and
community engagement. Regulations and incentives can only be published by government
bodies, but they may also be influenced by the other secondary stakeholders. NGOs and
universities/experts act as advisors to the government bodies and communicators to the public.
The media (news agencies, social media) also indirectly impacts the firm, but its
communication activities help shape perspective and certain narratives to the public. Though
secondary stakeholders are less likely to be acknowledged due to their indirect impact on the
business model and the primary stakeholders’ daily activities, they are the actors pulling strings
behind the curtain. Their influence lies more in shaping public perception and setting
boundaries for businesses and individuals to operate.
6.4.1. Value chain (primary) stakeholders
Based on the empirical work and literature findings, a conceptualization of the interaction
between the firm and its value chain/primary stakeholders is shown in Figure 15. This
conceptualization covers the material and monetary flows between the firm, its employees
(couriers), its retail partners (restaurants), its customers, its supplier (packaging producer), and
its third-party partner who manages the waste from end-of-life materials.
A key takeaway from the analysis of the barriers regarding stakeholder interaction is that trust
between the primary stakeholders is a significant barrier that prevents the willingness to
participate in a sharing economy model. For example, customers expressed distrust towards
the restaurants, saying that not all restaurants would follow the rules appropriately. Restaurants
also expressed skepticism towards couriers and customers, saying that these two stakeholders
could mishandle the containers without taking responsibility for it, posing the risk of conflict
of liability. This was also expressed by the sustainability expert, anticipating the risk of
disagreement between the three main stakeholders (couriers, restaurants, and customers)
regarding trust and quality control.
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Figure 15 Material and monetary flows between stakeholders
“What happens when someone neglects their responsibility? Say the
courier didn’t pay attention to the quality of the box when he accepted it.
Then if we said that there was something damaged, the courier could deny
it ‘No, it was fine when I accepted it.’ Something like that could happen, it
could cause a problem. Or maybe even that the number of containers could
be different.” – Bali Buda (Restaurant, Bali)
“But still, someone has to press the button and decide, ‘okay, the container
has been received back.’ For example, is the refund the same if the
container returns intact and if there is slight damage or leak? It should be
different. But then people could be throwing the blame on each other. It's
really risky from the customer service point of view, and the after-sales
service, it's risky, isn't it?” – Maria Dian Nurani (Sustainability expert)
There were notable mentions of other stakeholders, mostly in the context of what kind of retail
partner would be most suitable for a reuse & return model like this. Several potential partners
were thought to be appropriate such as:
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• Convenience stores and minimarkets
• Franchise and large business chains (e.g., McDonald’s, KFC, Bakmi GM → traditional
Indonesian noodle dishes fast food chain)
• Catering services
These can fit within the “retail partners” element in the stakeholder network map, as they are
just an expansion of the idea and not entirely a new group of stakeholders. The first,
convenience stores and minimarkets, was mentioned by the owner of CupKita himself. He
notes that they could become potential partners to support a more seamless reverse logistics
scheme. In addition, due to the large scatter of these stores in most urban locations in Indonesia,
having drop-off sites at their stores would make it highly convenient for customers to return
used containers. Some of these minimarket brands have also partnered with Gojek, Grab, and
other e-commerce platforms, further supporting the idea that they could also fit into this reuse
& return system.
The latter two entities were thought to be more suitable partners for the firm. It was
acknowledged that providing reusable packaging for individual businesses that already have
their own network of franchise outlets would be easier to start with since there is still the
possibility of customization of the container to fit the need of the brand. This model most likely
resembles Loop’s business model where the company facilitates the supply of reusable
packaging and the circulation and distribution management, but the design and print are
customizable and unique for each brand. Otherwise, catering services could also be a good
partner target since they already have a network of recurring customers, and the flow of their
service is scheduled more regularly (typically not for spontaneous orders, rather something that
is pre-ordered and planned beforehand).
From these additional remarks on potential stakeholders to engage, we can see that the
innovation process for circular business models involves considering a wider range of
stakeholders. Therefore, there is a need to take a step back to see the bigger picture of the
system, where various actors may emerge to be relevant to the business model.
6.4.2. Value network (secondary) stakeholders
Secondary or value network stakeholders were not mentioned too often by the respondents.
Only the stakeholder Government was mentioned in multiple cases, mostly by the NGO and
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Restaurant groups. From the perspective of the NGO, government intervention is needed in
order to support the implementation of circular innovations such as this reuse & return model.
“Actually, this also needs encouragement from the government as well
from the policy side because if it is not pushed like that, people will just opt
for the free alternative. For example, there is no prohibition regarding the
use of plastic containers, so (people will) just keep using plastic. That is the
case, unless the use of plastic containers is subject to a charge, then that
could be their consideration, right?” – Greeneration (NGO)
There were also several mentions of the government’s role from the Restaurant group. They
implied that government regulations have an essential role in shaping a more environmentally-
conscious business atmosphere and helped raise concern from the consumer’s perspective as
well. Having government support and incentives is typically expected to help push the circular
agenda.
“For a long time now, Warung Kecil has joined the campaign with
PlastikDetox to reduce plastic waste. It's just that in the early days before
the Gubernatorial Regulation (for the Plastic Ban in Bali) came out, it was
tough to educate consumers. ‘Why do I have to bring a shopping bag?
Doesn’t the store already provide me with one?’” – Warung Kecil
(Restaurant, Bali)
There were not many mentions of the role of NGOs and universities by the respondents. But
CupKita’s director noted that they, too, reached out to NGOs to get connected to the
government (Jati, 2021). Therefore, NGOs could be the middlemen to communicate the needs
and concerns of the firm and its primary stakeholders to the government, who in turn could, in
more tangible and binding ways, shape the business atmosphere and consumption culture.
“… whereas in Indonesia there is no regulation (regarding food safety and
hygiene standards) for micro-merchants… That's what I'm actually trying
to communicate with, for example, the Zero Waste Alliance or Greenpeace.
They are the ones who can connect us to the government. That's what I
want to highlight.” – CupKita, (Jati, 2021)
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There were no mentions of the stakeholder Universities/experts, but the fact that sustainability
experts and researchers were involved in projects such as the UNDP-Denmark-Indonesia
collaboration to report the potential benefits of a circular economy in Indonesia (National
Development Planning Agency, Embassy of Denmark Jakarta and UNDP, 2021), means that
the government is actively engaging with academia in shaping new regulation and development
plans. Media is also another unacknowledged stakeholder group which could contribute greatly
to the diffusion of new business models. Close relationships and positive engagement with
media partners will strengthen and widen the scope of the firm’s communication strategy in
reaching the community.
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7. Discussion
In this part of the report, further reflections upon the research findings are discussed following
the order of the research questions.
7.1. Characteristics of reuse & return systems
The main characteristics of reuse & return models lie primarily in their value proposition. First
of all, existing applications of the reuse & return business model typically start off from impact-
driven initiatives, which should hold true for most sustainability-oriented businesses. Then,
another prominent characteristic of reuse & return systems is the complex supply chain and
operations, with reverse logistics being the core of it all. In the conventional business model of
single-use packaging, the process starts with the supply of the packaging to the
retailers/restaurants, followed by use by the retailers/restaurants, then consequently by the
customers as the end-user, and finally ends with disposal by the customers. In this new circular
model, the idea of shared ownership and stewardship on the containers is introduced. The
container is supplied to the retailers/restaurants, used by the retailers/restaurants, then by the
customers, then returned to the retailers/restaurants to be used again, all under the management
of the firm who supplied the containers in the first place. In this scenario, the firm adopts a
stewardship role, as it holds the responsibility of maintenance and final disposal. There are
additional components to the circular process which make the most considerable difference to
the conventional model, namely reconditioning the containers for reuse (washing, sanitizing,
etc.), redistribution, and maintenance/repair.
The essential resources of the reuse & return model are also crucial determinants: first, the
mobile app for user interface, connecting its primary stakeholders, customers, and restaurants;
second, the actual containers itself; and third, its network of partners, which determine the
diffusion and adoptability of the model. All three of these resources are needed for a
conventional food delivery service anyway. For example, the mobile app is a central point that
connects its primary stakeholders: restaurants and customers. The importance of the network
of partners is also very mainstream in any business model: the more partners you have, the
better the chances of seizing the market. In the case of the reuse & return models, more essential
partners need to be managed: recyclers and those who repair damaged containers. The latter
could either be an additional third party or the manufacturers of the containers themselves.
Nevertheless, the ultimate difference between the reuse & return model and the conventional
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single-use packaging model lies in its containers. A reuse & return system requires long-lasting,
easily repairable products that can retain their physical properties and aesthetics over the length
of their optimal lifetime. In the case of reusable & returnable food packaging, a unique design
is required. It has to be both attractive and durable, and most importantly, suitable for the needs
of different users (retailers/restaurants). A universal design is critical here since the more
diverse the containers are, the more complex the distribution and redistribution systems are,
too.
The presence of regulations against single-use packaging is also often acknowledged as having
significance in supporting the uptake of this new, circular model. In most cases, regulations
don’t go further than promoting the reduction of plastic use, establishment of extended
producer responsibility, or responsible waste management of single-use materials. A tax on
single-use packaging was proposed and pushed to court by an initiative in Switzerland, but it
never passed as legislation (Zero Waste Europe, 2018). However, some regions are heading
towards the idea, namely the UK and the EU. Following the EU Single-Use Plastics Directive
(SUPD) in 2019, a tax on plastic packaging waste and a ban of certain plastic products (e.g.,
EPS food containers) have been agreed on. The tax on plastic packaging waste has already
been put into motion since January 2021. Meanwhile, the ban on certain plastic products will
follow (EU member states should have an action plan by mid-2021) (BFG Packaging, 2020).
The UK government also plans to introduce a tax on plastic packaging starting April 2022.
This tax will be limited to plastic packaging products that consist of less than 30% recycled
plastic (Gov.uk, 2021).
In the context of Asia, similar taxes have been introduced but typically focused on plastic bag
bans or restriction of waste import as seen in Thailand, Vietnam, Malaysia, and Indonesia
(Chen et al., 2021; Hartley, 2020; Liu, Thang Nguyen and Ishimura, 2021; Wu, Hu and Ni,
2021). Singapore is also currently working on a similar plastic bag tax scheme (Begum, 2021).
Although such regulations might not directly impact the development of reusable and
returnable food packaging models, it should still be regarded as a concrete step towards the
phasing out of single-use plastics.
Among the eight business cases considered, the most established examples seem to be barePack
and Muuse in Singapore, also RECUP and reCIRCLE in Europe. These businesses have
reached a more substantial number of partners compared to the other business cases. The scale
of expansion in these businesses may be primarily accredited to their partnerships and
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stakeholder engagement approach. RECUP serves not only restaurants and cafés but also
corporate offices and gas stations. ReCIRCLE has gained support from municipalities all over
Switzerland and partnered up with the country’s largest supermarket chain, hence achieving a
nationwide audience. BarePack and Muuse have both integrated themselves into large players
in the food delivery service business in Singapore.
In contrast, GOBox in the USA still operates locally (only in Portland, Oregon). DeliverZero,
also in the USA, started out already as its own food delivery service provider, unlike barePack
and Muuse, which only provided the containers and joined existing food delivery service
providers later. This may have given DeliverZero more obstacles in expanding their network,
as they face competition with larger food delivery service providers. Though if compared with
CupKita in Jakarta, Indonesia, which was launched at about the same time, DeliverZero still
has a much larger network of partners.
Out of the eight business cases, DabbaDrop is the odd one out. It is the only example that acts
more like a catering service than a widespread food delivery/takeout network. It is the only
case that only provides B2C services and delivers food to customers directly from their own
kitchen only, hence not connecting with any retail partners/restaurants to supply reusable
packaging to a broader audience other than themselves. However, the case of DabbaDrop is
still a relevant example of how starting with small systems could be the first step in supporting
the circular agenda. After all, there were some mentions from the interviews of this study (the
sustainability expert, one customer, and one restaurant) regarding the fact that this model of
reusable and returnable food packaging might fit catering services better. There were also
mentions by the expert and another restaurant that perhaps this reuse & return model would fit
better for franchise and business chains like McDonald's, Starbucks, KFC, etc.
7.2. Barriers & hotspots
In identifying the most crucial barriers and hotspots from different stakeholders' perspective,
there were some patterns or tendencies seen in each stakeholder group. Customers were mainly
focused on the value delivery and cost-benefit of the system: the quality, seamlessness, and
costs. Restaurants were the most concerned about a wide variety of operational issues, which
is well expected as they are the main actors running this reuse & return model (after the firm
itself). Food delivery couriers highly emphasized the need for adequate rewards for their
service. They would basically just follow along as long as they are guaranteed welfare and
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better pay. NGOs had a more holistic view, but they are also the ones most often mentioning
the need for government and communication-based interventions. The sustainability expert
mostly questions the actual environmental impact of the system and how it compares to the
conventional business model.
Between the cities (Jakarta and Bali), there weren’t any significant variations in restaurants'
perspectives, except for the fact that the Bali Restaurant group showed more concern towards
environmental impact. It is worth noting that the restaurant respondents in Bali were mostly
members of the PlastikDetox network and already participating in the campaign for plastic
reduction. In other words, they are already on the higher end of the environmentally-conscious
meter compared to the general population of restaurants. Coincidentally, the other two
restaurants in Bali who participated in this study but who were not PlastikDetox members were
also already highly conscious of their environmental impact (the vegan restaurant, Manggis)
or at least showed great interest in the topic of changing consumption behaviour and not just
substituting single-use packaging with biodegradable ones (SABO).
Between the Jakarta and Bali Customer groups, the main difference lies in their attitude towards
the return mechanism of the business model. Jakarta respondents were less open to the option
to return the food containers by themselves. They highlighted that the point of using online
food delivery services is so they don’t need to go out for food; meanwhile, this system requires
them to do so just to return the containers. In contrast, the Bali respondents were more accepting
of the idea, saying that they would be able to drop off the containers by themselves as they run
other errands around the city. As Jati (2021) mentions, the different attitudes of Bali and Jakarta
respondents might be caused by the difference in the urban architecture of the two regions.
Jakarta is a large metropolitan characterized by elite business complexes but also very dense
slum areas. It has various modes of public transport, which still lack integration. The high
traffic of commute from nearby cities also makes the city notorious for heavy traffic jams and
air pollution. Meanwhile, Bali is a more close-to-nature and walkable city. Indeed, urban
architecture poses a barrier that could potentially be the underlying cause of the problematic
uptake of circular business innovations. How the urban environment is built and how its
transport systems work shapes the way people interact and go through their daily activities. It’s
not just about the lack of environmental concern but also largely about how the system does
not facilitate pro-environmental behaviors, hence making it burdensome for people to do.
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In general, the barriers that are most significant to stakeholders are Cost benefit, Quality
control, Convenience, Niche market and Compatibility. The first barrier, Cost benefit, is fairly
straightforward. It implies that the system imposes higher costs to the customers (additional
charge on the reusable container, as well as costs for transport when returning the containers)
and restaurants (particularly for operations and handling, since they would have to wash the
containers and manage returns), hence making it less acceptable. The second barrier, Quality
control, refers to the fact that the system requires strict monitoring regarding the quality of the
container itself and is linked to hygiene and halal and non-halal separation. The third most
significant barrier is Convenience, meaning that the system is perceived as impractical to most
respondents. The fourth is Niche market, implying that the reuse & return model would only
be attractive to the high-income, environmentally-conscious consumer segment, which is still
a small group in Indonesia. The last is Compatibility, which refers mainly to the concern of
whether the universal packaging can fit the varying styles of different restaurants. These
findings highlight that the main aspects of an innovation that people focus on are the economic
implications and practicality rather than the environmental impact.
There were also several overlaps between some barriers. These overlaps most likely indicate
close relation of one barrier to another, meaning that a shift, change or elimination of one
barrier might also have an impact on its pair barrier. From the context of the statements with
overlapping barrier codes, most overlaps imply some form of a causal relationship. These are,
however, not supported with statistical data, hence cannot be concluded quantitatively. In the
overlaps with Cost benefit and Consumer/market preference, the restaurants assume that the
additional costs imposed by the reuse & return system will force them to raise their price points.
This will, in turn, change their market segment (if the increase is significant). The restaurants
also implied that changes in their market segment and price points are unwanted, perhaps
because it will most likely narrow their target audience. Regarding the overlaps of Hygiene and
Trust, the customers expressed their distrust and doubt towards the restaurants’ compliance
with food safety and hygiene standards. Trust towards restaurants could be developed with the
application of stricter, more transparent hygiene and food-safety protocols. This could be
achieved through government regulation or certifications. Cost benefit has overlaps with both
Convenience and Concern for the environment. Mainly addressed by the couriers, the
Convenience factor largely affects their expectations towards the benefits they are receiving.
The more inconvenient the task is, the more money they expect to be earning. Regarding
Concern for the environment, the context is that for people who are less likely to participate in
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a pro-environment activity, the emphasis of benefits over costs must be more prominent.
Otherwise, it would be difficult to engage that market segment. These findings indicate that the
overlapping barriers should be the primary targets for improvement to speed up the process of
innovation diffusion. It also implies that one barrier could be highly dependable on another.
For example, the Trust barrier might be weakened through good communication strategies. But
the underlying cause of that barrier is actually the Hygiene barrier; hence it might be more
effective to target the latter first, as it is the root cause of the former.
The hotspots identified are mainly in the Design and supply of the container, the Storage and
washing, as well as Reverse logistics. As mentioned previously, the compatibility of the
container design is an important aspect. Hence the design process is seen as vital in kickstarting
a successful reuse & return scheme. Storage and washing is another hotspot, again linked to
one of the main barriers mentioned above: Quality control. This is primarily connected to the
need for halal and non-halal food differentiation and the lack of well-defined food safety
standard instructions for all levels of business (not just the high-profile, large business chains
but also the SMEs which dominate the food service sector and encompasses a larger scope of
the Indonesian consumer segment). Reverse logistics is yet another critical part of the business
model, which calls for creative solutions to create a seamless experience for both the customers
and restaurants. Most respondents were doubtful about this part especially. For restaurants, the
concern was about how redistribution is managed and how the firm ensures that each restaurant
has adequate stock of containers at all times. For consumers, the focus was how they could
return the container in a time- and cost-efficient manner since the point of online food delivery
services is providing people the option to obtain food without actually having to go out. For
couriers, it’s mostly a matter of having the extra task of returning the container that becomes a
problem unless they are given adequate bonuses or income to make up for it. This also implies
that there will be difficulty during the first adoption phase when there are still very few
retail/restaurant partners registered on the network. More partners in the network mean more
return sites within the area, making returns much more accessible for both customers and
couriers.
7.3. Stakeholder network
The stakeholder network is a critical determinant in the success of circular business models. A
vital barrier identified that is also relevant here is Trust. In the context of Trust, the challenge
lies in reducing skepticism and negative presumptions among stakeholders, especially
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regarding food safety measures. This entails that there must be transparent monitoring of
restaurants and strict hygiene protocols, and an urgent need for more stringent regulation from
government bodies to create a reliable business ecosystem. The idea is that when there is a
nationwide, formal regulation on strict food safety and hygiene protocols, then businesses are
already used to complying with such standards, and the public has little reason to doubt the
credibility of companies in regards to hygiene. This further implies the need for careful
communication and transparency to all stakeholders. Communication with restaurants needs to
be maintained, so they are committed to delivering the highest standards. Meanwhile, for
customers, close and careful communication is required to understand how the system works
and feel that the system is reliable and trustworthy. These findings show that lack of trust in
communities could inhibit innovation, especially in the context of a sharing economy.
Though rarely mentioned by the respondents, attention needs to be called towards the lack of
support of a wider range of primary stakeholders, such as suppliers or manufacturers of food
packaging. The market for eco-friendly packaging is still a niche in Indonesia, hence making
the prices high and feeding into the inertia and reluctance to transition away from single-use
packaging. Policy disincentives from the government like taxation of single-use packaging may
be an idea, which would force not only the end-users like restaurants and consumers but also
the more upstream actors in the supply chain who manufacture the packaging products, to
change their business-as-usual model to find more sustainable alternatives.
7.4. Implications for the business model design
A critical aspect of the business model that needs careful consideration during the design
process is the financial model. Finding the most optimal financial model is not only about
finding the most attractive deal for all primary stakeholders (customers, restaurants, couriers),
but also how to ensure seamless flow, high return rate, and true circularity. Too high a price
would make people reluctant to try. But too low a price may discourage users from returning
the product to the system and instead keep it for themselves without necessarily using it for as
long as the lifetime it was intentionally designed for. The point of the reuse & return system is
sharing and extensive reuse through the use of the network and the community. If this is not
achieved, then there is a risk for a rebound effect. The firm produces high-quality, durable
products designed for extensive reuse, but the customer does not return them to the system;
hence the firm must produce more products and cannot achieve the target break-even point to
be ecologically beneficial compared to single-use packaging.
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The environmental impact is another crucial aspect in the design of the business model. Though
often overlooked, the actual environmental footprint of the system needs to be clarified with
LCAs and locally relevant studies to prove whether it is genuinely more ecologically friendly
than the single-use packaging system or not. Reflecting on previous LCA studies, reusable
packaging needs to be made of certain materials and be produced, washed, and treated in
specific conditions to perform ecologically better than the single-use packaging (Changwichan
and Gheewala, 2020; Greenwood et al., 2021; Moretti et al., 2021; Otto et al., 2021; Stefanini
et al., 2021). For instance, glass doesn’t seem to be better than single-use materials even in a
reuse scenario (Otto et al., 2021; Stefanini et al., 2021), while reusable plastic (PP) and steel
containers have lower global warming impacts than the single-use packaging alternatives, but
not in the land use and water consumption impact categories (Greenwood et al., 2021). The
Greenwood et al. (2021) study, however, did not take into account the emissions from transport
of returning the container (from the customer to the retailer/restaurants). This is especially a
concern in the Indonesian food delivery service context because the system would rely heavily
on the return of containers through couriers or ojek drivers if customers are not willing to return
them by themselves. Meanwhile, these ojek drivers operate on motorbikes that run on fossil
fuel. Delivery and transport with bicycles might be the solution in some countries, but it is not
a common mode of daily commute nowadays in the large metropolis of Indonesia. Other than
the global warming potential impact, water consumption was also mentioned in some
interviews as being critical. Hence, it is essential to know which impact categories need to be
put into focus.
Also connected to the environmental impact is the sourcing of materials used to produce the
containers. This will highly affect the total environmental footprint, especially if there is a
rebound effect from low return rates. Also, like in the case of CupKita, where local producers
aren’t able to deliver the adequate quality needed for the system (Jati, 2021), imports from
other countries may very well translate to higher emissions due to transport. The CupKita
representative does not say precisely that this makes their environmental impact more
significant. Still, material sourcing is an important consideration when conducting LCAs and
measuring the environmental footprint; hence it must be accounted for.
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8. Conclusion
Plastic is undeniably one of the most impactful inventions throughout human history. It is
cheap, lightweight, strong, and versatile, serving many purposes. In the food industry alone,
plastic packaging helped significantly reduce food loss and aided in more inclusive and
widespread food distribution. With its gaining popularity in industrial and household uses,
plastic production grew from 15 million tons in the 1960s to over 300 million tons in 2014.
This number is predicted to double over the next two decades (World Economic Forum, Ellen
MacArthur Foundation and McKinsey & Company, 2016). Consequently, it has given rise to
an overwhelming flow of plastic waste which presents a burden to the urban and marine
environments. It also contributes largely to climate change as its production process is fossil-
intensive.
Many solutions have been developed over the years, namely recycling and substitution with
bio-based or biodegradable materials. However, it is now clear that end-of-pipe solutions and
mere material substitution cannot fix the underlying root problem: excessive consumption and
careless production. The circular economy concept emerged to answer such concerns,
endorsing systems thinking, waste elimination, and optimization of material use while
integrating an extensive network of stakeholders. Through the circular economy, the world is
envisioned to maintain its economic function to achieve well-being while also operating within
a safe space inside the planetary boundaries. It is not merely about changing production but
also digs deeper into the concepts of value, utility, ownership and ultimately changes our
perception of consumption in general.
As an emerging concept, literature on the conceptualization and implementation of circular
economy and circular business models are concentrated in the industrialized, western world,
with little proof of how it translates to the context of developing countries. Meanwhile, the
developing countries are among the most vulnerable to plastic waste pollution, with less
reliable recycling systems and waste management regulations in place. Apart from the
geographical context, not many successful case studies are found in literature, providing insight
into the real-world challenges of implementation.
This study focuses on one specific archetype within the circular business model theory, which
is reuse. This is taken into context of food delivery services, looking at reuse & return models
for food packaging. The geographical context is Indonesia, a fast-growing economy and
124
archipelago country that is especially prone to marine habitat destruction due to the leakage of
plastic waste into the sea. The study is divided into two main parts. The first is to identify the
characteristics of existing reuse & return models, which is done through literature (both
scientific and grey) research and an interview with an existing business with a similar model
in Indonesia. The second part is to identify challenges of possible implementation (barriers,
hotspots, stakeholder interaction). Data was gathered through stakeholder interviews and focus
group discussions.
The core characteristics of reuse & return models that distinguish them from conventional
models are the close integration of various stakeholders, the durable, reusable container as the
main product, and the reverse logistics concept. The stakeholders upstream and downstream of
the supply chain, in some way, are all given stewardship roles towards the shared product: the
containers. Suppliers would manufacture the products and be expected to provide repair
services to prolong the lifetime of the product. Restaurants not only use them to carry their
food, but they also need to maintain, wash and prepare them for reuse. Customers do not only
consume the food that comes in the container, but they must then take care and return the
container to the system as well. The container, which is the firm's main product, is not actually
the primary value delivered to the customer. The primary value is, after all, the food inside the
container. But the container provides a means to more sustainable consumption. In order to
provide that function, it must be durable and have a universal design to facilitate easier reverse
logistics.
The main barriers identified are: 1) that the costs outweigh the benefits; 2) that the system is
more inconvenient compared to the conventional single-use packaging system; 3) that the
system requires careful quality monitoring and control; 4) that it is still applies for a very niche
market, a minor group of environmentally-conscious people; and 5) that it would be difficult
to design a universal container that would suit the needs of its various retail
partners/restaurants.
The hotspots or crucial elements of the business process are: 1) the design and supply phase,
indicating that the chosen design of the container is crucial; 2) the storage and washing phase,
indicating that the system makes for more complicated operations in restaurants; and 3) the
reverse logistics, indicating that the return and redistribution of containers to the restaurants
could get messy. In regards to reverse logistics, the return rate is an important indicator. Having
a low return rate will lead to the increase in the manufacture of a product that has a higher
125
environmental footprint than single-use products when it is not used optimally. This presents a
risk for a rebound effect.
The most important stakeholders to the reuse & return system are, first and foremost, the
customers and restaurants. They are the users of the product (the reusable container), and their
participation determines the success and scalability of the business model. Besides them, other
primary stakeholders that were found to be crucial are the couriers, packaging producers, and
end-of-life waste management bodies. The integration of the latter two stakeholders marks a
distinctive characteristic of a circular business model. The firm maintains close relations with
the manufacturers and recyclers to ensure that the product can be repaired and recycled to
achieve optimal material use. Though giving indirect impacts to the system, secondary
stakeholders such as government bodies, universities/experts, and NGOs also contribute to the
network. Through community education and formal legislation, these stakeholders help shape
the business ecosystem, which could either support or inhibit the growth of circularity.
Findings from this study show that this circular business model of reusable and returnable food
packaging would better target a smaller, niche market first, both regarding the customers and
retail partners. The most relevant customer segment is the high-income, environmentally
conscious group who might be able to overlook the impracticality and additional costs imposed
by the new business model and focus on the cause and value delivered. The retail partners in
the focus of this study were restaurants and mainly SMEs. But with the study results, it is clear
that other kinds of retail partners might be a better target, especially for the early
implementation phases. Alternative retail partners could be catering services (because they
serve customers directly, hence doesn’t present the hassle or risk of random redistribution
between different restaurants) or large business chains with multiple outlets and have their own
delivery service. In addition, support of government incentives or disincentives (such as taxes
on single-use packaging) might help widen the scope of the market for reuse & return systems.
As with any innovation, the organizational or systemic inertia might hold back the growth of
new circular business models. Nevertheless, the way to break into the system is to find creative
solutions to deliver better value, encourage more sustainable habits while also maintaining
convenience and cost-effectiveness. Indeed, the main challenge is creating a seamless system
that makes sustainable consumption easy and inclusive.
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8.1. Limitations
There were several limitations to this study that have affected the data collection phase. First,
the geographical scope was limited to Jakarta and Bali, which were identified as strategic
regions for potential piloting, hence presenting a relevant focus of study. Other cities in
Indonesia might also be relevant to this study, large metropoles with unique culture-business
ecosystems, like Surabaya and Medan. Nevertheless, limited resources to reach respondents in
those areas were the main reason for this scope decision.
The researcher was also limited to only having Jakarta courier respondents, as there were travel
restrictions to Bali during the current Covid-19 pandemic. Meanwhile, the couriers were the
only respondents who had to be interviewed in person on the streets. Hence, interviews with
Bali couriers were not carried out. Furthermore, even the Jakarta courier group
discussions/interviews had to be cut short due to reluctance from the respondents to commit to
a more extended session. Therefore, these group discussions/interviews were not so in-depth,
and the researcher could not dig deeper into the reasoning behind their answers or ask more
about their background and experience as a courier. In general, the list of stakeholders
interviewed was also not too extensive, as the researcher had no connection to the
supplier/manufacturer and recycler communities.
The number of Jakarta restaurant respondents was also far less than the Bali restaurant
respondents, presenting an imbalance. This issue was easier to overcome by using the
percentage of mentions instead of absolute numbers when dealing with the content analysis.
Another limitation of the study is that the researcher could not conduct interviews with other
existing reuse & return start-ups other than CupKita, hence not much insight regarding the
implementation in different countries could be concluded. The researcher also initially planned
to interview at least one of the Indonesian technology-based giants that provide online food
delivery services (Gojek and Grab) to offer an inside look into the system. Nevertheless, this
also was not achieved, either because it was difficult to get into contact with the relevant
individuals or that they were not available for such an interview.
8.2. Outlook and future research
The practical and scientific implications of this study provide an outlook for the future of
circular business models, perhaps most fitting to the Indonesian or in general, developing
127
country context. The practical implications come twofold. The first is that, in designing circular
business models, the focus should not only be on the most obvious sector that contributes most
to the problem but also widening the search to other sectors or stakeholders which may have
better potential in actually implementing the innovation. For example, this study primarily
focuses on SME restaurants as the primary partner for the reusable and returnable packaging
provider. Through stakeholder interviews, it was later identified that other businesses might be
more relevant, such as catering services and large business chains. The results also imply that
starting in smaller networks might work better in the first phase of adoption. If the model is
immediately rolled out to massive networks like in well-established food delivery platforms
e.g., Gojek and Grab, there might be more resistance and complications in the process
specifications and operations. This can be done by approaching specific business chains or a
small network of businesses that share the same vision or are located in close proximity to each
other (like in a shopping center or an office building). Targeting specific regions like a small
city or district is another strategy to start small.
The study results also contribute to the growing body of scientific work on the topic of circular
business models. The explorative approach of this research builds on existing practices of
bottom-up solutions and tries to analyse it with a scientific framework to identify the
underlying factors of organizational and systemic inertia that hinder change. Also, by
presenting a short review of current practices in different countries, the study contributes to
identifying patterns of strategies that can be used for practitioners, entrepreneurs, or even
government bodies.
There is always room for more research to support the development of this research field
further. To address and identify the contextual factors, more in-depth case studies of successful
reuse models worldwide can be done to pinpoint success factors based on the context of
geographic region or culture. Another interesting and relevant research topic is life cycle
assessments (LCAs) of reusable-returnable packaging vs. single-use packaging. What is
essential to such an LCA is the acknowledgement that the impacts due to transport of
redistribution may be significant and the production and import of the container itself. The
results would most likely depend heavily on the geographical context. Therefore, it would be
helpful to have LCAs from a variety of different regions across the world. Another potential
research study to contribute to this body of work would be to do non-participant observation
128
studies for pilots or such reuse models. This kind of research could investigate the challenges
happening in real life, hence having a better chance at eliminating bias in respondent answers.
129
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Appendix A: Focus group discussion and interview script and question
guidelines
[INTRODUCTION]
Good morning / afternoon / evening, Ladies and Gentlemen! And welcome to today's focus
group discussion. First of all, thank you for your willingness to participate in this discussion.
My name is Nadya Humaira. I am a Masters student from the University of Graz in Austria
with a study focus on Circular Economy. Today's discussion is conducted as part of my master
thesis project.
For methodological purposes, I will need to record this session. So before I continue, I would
like to ask for your consent on the matter. Please confirm whether or not you are willing to be
recorded. Your consent entails that your response will be taken as data for my master thesis
study.
The purpose of this study is to determine the potential for implementing a new business model
in food delivery systems using reusable food packaging. In this system, customers order food
in reusable packaging and then return them to the restaurant for reuse. Maybe you have heard
the term “Reuse” one of the 3Rs that is often mentioned when talking about the waste problem.
"Reduce, Reuse, Recycle." Now in this model we will apply the concept of "reusable
packaging", plus the concept of "returnable packaging" which is expected to reduce waste
while still providing the same function.
Why did I bring up this topic? Because the food industry is constantly growing and becoming
more popular, and Indonesian residents are also consuming more. Especially during this
pandemic, people will order more food to eat at home. Generally, restaurants will serve these
foods in single-use, disposable containers, which in turn will lead to a lot of waste. To solve
the problem of this buildup of packaging waste, we propose a system solution that ensures that
the packaging material can be used repeatedly, thereby reducing waste.
You are here as a representative of restaurant owners/consumers/online motorcycle-taxi driver
/NGOs/local sustainability experts/similar businesses, and in other sessions we will also hold
discussions with consumer groups, online motorcycle taxi drivers, restaurant owners, NGOs,
and local sustainability experts as well. We hope that from the results of this study, this more
144
sustainable business scheme can be implemented by online mobility companies that provide
food delivery services, so that the food industry can continue to run while also prioritizing
environmental sustainability.
[OVERVIEW OF THE SCHEME]
That's more or less the initial explanation regarding my study and topic of discussion today.
Next, I would like to describe how this system works (refer to diagram):
First of all, as we usually use the online mobility app for food delivery services, consumers
will order food through the application. When selecting food from the menu, consumers can
choose to use reusable containers directly in the same application. The concept is that
consumers choose what container they want to use. Stick to single-use containers, or do you
want to upgrade to reusable containers? Let’s say, to use reusable containers, consumers must
pay a deposit of IDR 20,000 per container. This deposit will be refunded to the consumer after
the container is returned. To cover the return delivery cost though, the refund will be deducted
with the transport fee, for example Rp.5,000 per container.
Then, if the consumer chooses a reusable container, the merchant will accept the order with
this note, and will pack the food according to the order. The food is then delivered by food
delivery courier and accepted by the consumer.
When finished, consumers are asked to kindly wash the reusable containers before returning
them.
Then how do consumers return the container to the system? There are several options regarding
return mechanisms. First, the consumers themselves return the containers. Meaning that the
consumers will do the drop-offs themselves. Second, consumers can return the containers
through the food delivery courier in their next order. So when consumers place their next
delivery order, for example 3 days later, consumers can give the container from the previous
to the food delivery courier. Or the third option, which is that consumers order an instant
package delivery to return the container.
For the return location, it can be given to the same merchant, or to another merchant partner
who is nearby and also participating in this program. So the container doesn't have to be
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returned to the same place. The important thing is to return it to one of the participating
merchants using reusable containers too.
After the merchant receives the reusable container again, they are required to wash the
container according to a specified hygiene standard. Even after washing by consumers, this
step is still necessary to ensure that food is packaged in containers that adhere to hygiene
standards. After washing, the container can be reused for the next order.
From the diagram that I showed, there are parts that I haven't explained earlier. Namely the
payment mechanism from the consumer side. There are two choices of payment models for
consumers. First, the consumer pays the deposit for each reusable container in each transaction.
This payment model is what we call the deposit-refund model. Here the consumer will pay in
advance, for example Rp. 20,000 per container, then part of the deposit will be refunded when
the container is returned, for example, Rp. 15,000. Why is it only partially refunded? This extra
money will cover the shipping cost, if indeed the container is returned via the food delivery
courier. If returned directly and in person by the consumer themselves, the refund is 100%. The
second model, is where consumers pay a monthly or annual fee like a subscription. So every
time you order food and choose reusable containers, you don't have to think about paying again.
The advantage of this subscription model is that consumers do not need to spend more money
to return the container.
[SPECIFIC FOR MERCHANTS]
What about merchants? Do you need to pay again to use reusable containers? For this initial
scheme, merchants will be able to participate free of charges for using reusable containers. It
is enough to state that you want to participate and determine the number of containers needed,
and fulfill the obligation to clean the containers according to the specified hygiene standards
and follow the protocols of the scheme.
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[QUESTIONS FOR MERCHANTS/RESTAURANT OWNERS]
Aspect Questions
Perception 1. What are your impressions on the scheme that I have just described?
Current
packaging used
1. What kind of packaging do you use for delivery or takeaway orders at the moment?
2. How much do you spend on those packaging?
3. Have you ever used reusable packaging for delivery or takeaway orders before?
If YES, what difficulties have you faced in using such packaging?
If NO, what are the barriers? What are your considerations for not using reusable
packaging?
4. Here are 3 alternative packaging that are reusable. Which one is most suitable for the
food that you serve? Which one do you think is easier and more convenient for you
(to wash, to store)?
a. Silicone, collapsible food box
b. Stainless steel
c. Plastic (PP/HDPE)
Readiness 1. To participate in this scheme, merchants will have to wash the reusable container
following a certain hygiene standard, even though the container comes back clean
from the customer. Are you willing and able to follow such protocols?
2. Are you willing and able to allocate the space and resources to store and maintain the
reusable packaging?
3 main
considerations
1. What are the 3 main considerations for you to opt into this program and switching
from single-use, disposable packaging to reusable packaging?
2. What do you think are the disadvantages and difficulties for you to opt into this
program?
[QUESTIONS FOR FOOD DELIVERY COURIERS]
Aspect Questions
Perception 1. What are your impressions on the scheme that I have just described?
2. What do you think are the disadvantages or difficulties that you might face with this
scheme?
Readiness 1. To deliver food orders, do you have any difficulties or obstacles regarding your
courier bag?
2. Have you ever faced difficulties in delivering an order?
3 main
considerations
1. What are the 3 main considerations for you to opt into this program and switching
from single-use, disposable packaging to reusable packaging?
2. How could we make this scheme more convenient for you? What would make it
more interesting for you?
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[QUESTIONS FOR CONSUMERS]
Aspect Questions
Perception 1. What are your impressions on the scheme that I have just described? (not just about
the mechanism but also about the payment scheme)
Purchase behavior 1. How often do you order food delivery through mobility apps?
2. In what kind of situations do you order for delivery?
3. Have you ever ordered food in reusable packaging?
If YES, why did you choose the reusable packaging?
If NO, what were your considerations?
Payment scheme 1. Which payment scheme do you prefer? The deposit-refund model, or the
subscription model?
2. How do you normally pay for your orders? Cash or digital wallet? Why?
Readiness 1. Are you willing and able to maintain and wash the reusable containers before
returning them?
Return
mechanism
1. Which of the return mechanism options do you prefer? Self-return, return via the
courier on your next delivery order, or send a package directly?
2. What are the disadvantages and barriers for each of those return mechanisms?
Note:
Self-return: the deposit gets refunded to you 100%
Return on your next delivery order: the refund is deducted by the transport cost
Return by ordering “send package” service: the refund is deducted by the transport cost
3 main
considerations
1. What are the 3 main considerations for you to opt into this program and switching
from single-use, disposable packaging to reusable packaging?
2. What do you think are the disadvantages and difficulties for you to opt into this
program?
3. How could we make this scheme more convenient for you? What would make it
more interesting for you?
[QUESTIONS FOR NGOs AND SUSTAINABILITY EXPERTS]
Aspect Questions
Perception 1. What are your impressions on the scheme that I have just described?
2. What are the advantages and disadvantages of this scheme?
3. What obstacles and barriers do you think customers and merchants will face in using
this kind of scheme?
Packaging
material
1. Here are 3 alternative packaging that are reusable. What criteria would you consider
in deciding which is the best and most sustainable alternative?
a. Silicone, collapsible food box
b. Stainless steel
c. Plastic (PP/HDPE)
Behaviour change 1. How do we get people to opt into this reuse & return scheme?
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3 main
considerations
1. What are the 3 main considerations that you think will make people opt into this
program and switching from single-use, disposable packaging to reusable
packaging?
[QUESTIONS FOR EXISTING BUSINESS CASE]
Aspect Questions
Confirmation of
business model
1. How does the return mechanism work?
2. Who does the washing of the containers?
3. What are the responsibilities of the company, and their partners, in terms of
operation and supply management?
Packaging
material
1. What material do you use, and why?
2. What were the other alternatives considered?
Challenges and
learnings
1. What challenges did you face?
2. How big is the market of environmentally-conscious consumers?
Hotspots 1. Which part of the supply chain or workflow of the business is most crucial? In
economic terms (most critical expenses) and in operational terms (most critical or
difficult phases to manage)
Success factor 1. What factor contributed to your success (or rather lack of)?
Stakeholders 1. Which stakeholders were most important to the diffusion and in growing acceptance
of your business model?
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Appendix B: Existing reuse & return food and beverage container business
cases
1. MUUSE (Singapore, Hong Kong, Toronto)
Overview:
Started under the name Revolv in Indonesia, then developed into Muuse and launched in
Singapore in February 2020, first providing only reusable coffee cups to cafés and
restaurants with a standalone app. In Hong Kong and Toronto, Muuse is still within the
pilot phase. In their headquarter in Singapore, Muuse has since expanded into food
delivery territory, partnering with online food delivery services GrabFood and FoodPanda
in Singapore to provide reusable food containers to restaurants.
Tracking technology:
QR code
How it works:
Renting in cafés:
1. Find a partner café through the Muuse app
2. Borrow a reusable beverage/food container by scanning the QR code which is
printed at the bottom of the container
3. Return the container at any Muuse café/restaurant or designated return station,
scanning the QR code again to end the transaction and rent (within 14 days)
4. The containers are cleaned by the partner café/restaurant or at the return station for
reuse
Renting through food delivery app:
1. Select merchant through food delivery app
2. Add the Muuse reusable container item to the order
3. Enter Muuse ID and follow additional instructions
4. Scan the container’s QR code upon delivery
5. Customers clean and return the container within 14 days to any Muuse café
6. The partner café/restaurant cleans the containers for reuse
Payment scheme:
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For restaurants/cafés, partnership with Muuse is free of charge. They are only required to
wash the product when they are returned to their store. Discounts to promote the use of
Muuse containers are advised but not mandatory for partners. In return, their business is
promoted by Muuse to their network of followers and will reach a new market of
customers.
Customers pay a subscription fee, SGD5 monthly or SGD42 annually. Customers are also
charged SGD25 if they do not return the containers after 14 days.
Material of product:
- Muuse cup: double-walled, food-grade stainless steel, suitable for both hot and
cold drinks. Dishwasher-safe, easy to clean. Comes in 2 sizes: 12 oz (M) and 16
oz (L)
- Muuse food box (only in Singapore): leak-proof, bamboo fibre food box with
bamboo lid. Suitable for both hot and cold food. Dishwasher-safe. Comes in 1 size,
800 ml
References:
Muuse (2020b), Ong (2020), Reilly (2020), the Muuse mobile app
2. CUPKITA (Jakarta, Indonesia)
Overview:
Initiated by Enviu, who partnered with Muuse to launch CupKita in Jakarta, Indonesia.
Developed based on Muuse’s business model, currently with seven partner cafés in
Jakarta. Only available for takeaway (not delivery) of beverage products, and has a
standalone mobile app.
“Disposable coffee cups are a leading source of plastic waste. The average
coffee store in Jakarta sells around 125 single-use cups per day whilst the
biggest chains sell up to 1k. Together we can reduce 525-2,100 kg of waste
per store per year.
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We provide an alternative to single-use by reducing waste at source. The
reusable cup service enables circular consumption while making your
coffee store sustainable at a lower cost.
You save the planet. We do the cleaning.” (CupKita, 2021)
Tracking technology:
QR code
How it works:
1. Customer orders beverage at a CupKita partner café and choose the CupKita
reusable cups
2. Customer scans the QR code with the CupKita app and pay a refundable deposit
3. Customer returns the cup to any CupKita partner cafés within seven days, and the
gets the refund
4. The cups are cleaned by CupKita partners (CupKita also provides them with the
necessary training, cleaning equipment, and materials)
Payment scheme:
Restaurants/cafés pay IDR500 (about the same as USD 0.03) per cup rented, which is
cheaper than stocking up on single-use packaging.
Customers pay a refundable deposit of IDR50,000 per container rented. The deposit will
not be eligible for a refund if the cup is unreturned within seven days.
Material of product:
Stainless steel cup, comes in 2 size (8 oz and 12 oz) and various colors (silver, black, red,
and yellow)
References:
CupKita (2021), Hicks (2020), Jati (2021)
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3. BAREPACK (Singapore)
Overview:
Founded in 2019, barePack is Singapore’s leading reusable container service for
sustainable food delivery, with partners FoodPanda, Deliveroo, and GrabFood. Currently,
barePack has over 150 partner restaurants. barePack also operates a standalone mobile app.
“Born from the frustration upon witnessing the abundance of disposable
plastics consumed in Singapore, and the injustice felt having to choose
between convenience and sustainability. barePack's practical day-to-day
solution makes food online delivery sustainable, fights disposables and the
over packaging waste culture, with a focus on education. barePack aims to
build a community where all stakeholders come together and create a
movement to build a future where convenience and sustainability co-exist,
where there is no waste to be generated at the beginning, and reduce the
burden for recycling.” (barePack, 2021a)
Tracking technology:
QR code
How it works:
For customers
1. Customers choose “barePack” or “eco-friendly packaging” on the food delivery
app as they order. They will get an OTP code from the barePack app which must
be pasted in the food delivery app
2. For takeaway, customers only need to scan the QR code of the container on-site
3. Return whenever to any of the partner restaurants (no limit whatsoever). Members
can request for home pick-ups/collection when they reach five containers, but when
their account holds five unreturned containers, the customer cannot place an order
with barePack containers
For restaurants
1. Restaurants sign up, receive packaging and online training
2. Processes online food delivery orders or in-store pick-ups
3. Receive returns and sanitize to prepare for reuse
4. Receive weekly report on environmental impact
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Payment scheme:
For customers, there is a free 1-month trial subscription, then they can either opt for
monthly subscription for as much as SGD 1.45 per month, or keep using barePack for
“free” with a deposit and return scheme, where the refund comes within 78 hours of return.
Material of product:
- Silicone Flexboxes
- Stainless steel cups
References:
barePack (2021b), Salim (2020), Ho (2021), Figueiras (2020)
4. RECUP (Germany)
Overview:
RECUP is a shared reuse coffee cup scheme for cafés and restaurants, and now also
partnering with gas stations, canteens and companies as well. Currently, RECUP is
available at more than 7,500 sales points throughout Germany. The RECUP mobile app is
used to locate their partners.
Tracking technology:
None
How it works:
1. Customers pay a deposit when opting for a reusable cup at the café, restaurant,
canteen, etc. Likewise, retail partners also pay the deposit and a membership fee to
RECUP to participate
2. After use, the empty cup can be returned to any RECUP partner, where the
customer will be given their deposit back
3. RECUP partners are required to clean and reuse the cups returned to them
4. Deposits are paid back to retail partners when cups are returned to RECUP at the
end of their life cycle
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Payment scheme:
For retail partners, RECUP charges a membership fee to finance the system and mobile
app. They must also pay EUR 1 deposit per cup.
For customers, they pay a deposit of EUR 1 for each cup that they use. This will be
refunded upon return.
Material of product:
Food-safe, BPA-free plastic PP cups, and lids. The cups come in 3 sizes: 0.2L, 0.3L and
0.4L, suitable for hot drinks. They are dishwasher-safe and stackable
References:
RECUP (2021)
5. RECIRCLE (Switzerland)
Overview:
reCIRCLE, started as an initiative in Bern, Switzerland in 2016 to reduce single-use
packaging waste from takeaway food which provide a deposit scheme for reusable
takeaway food boxes to restaurants. Currently, there are 1,500 partner restaurants in the
reCIRCLE network. reCIRCLE is also partnering with Migros, Switzerland’s largest retail
company and supermarket chain.
Tracking technology:
Unknown
How it works:
1. Customers go to a reCIRCLE partner restaurant and they can order their meal or
beverage in a reCIRCLE box or cup. There is a refundable deposit for each box
and cup
2. After use, customers return the box or cup to any one of reCIRCLE’s partners and
obtain their refund or a new reCIRCLE product. Otherwise, customers can clean
the product and continue to use and refill it for as long as they want.
3. If returned, partner restaurants must clean the reCIRCLE products to prepare for
reuse
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4. Damaged boxes or cups are collected by reCIRCLE and recycled directly by its
manufacturer: Einsiedeln, CH.
Payment scheme:
Restaurants pay CHF 150 per year, with additional subscription charges based on the
number of boxes they need. There is a 3-month trial period where the restaurants test out
the system. Depending on the subscription fee the restaurant opts for, the number of boxes
they need to sell per day as a minimum to gain profit can range between 6 to 32 boxes.
With average price of single food packaging about CHF 20 cents (ranging from CHF 7-80
cents or EUR 6-67 cents), ReCIRCLE’s model present considerable savings for the
restaurants.
Customers pay CHF 10 for the reCIRCLE BOX (food container) and CHF 5 for the
reCIRCLE ISY (cups) which gets refunded upon return.
Material of product:
- Food boxes are BPA-free, PBT plastic boxes called reCIRCLE BOX, specifically
designed to be durable and fit easily in dishwashers. Provided in “aubergine” color
(purple) to ensure that the boxes are easily recognizable
- Reusable cups called the reCIRCLE ISY are made of a durable plastic with a PP
lid. They are transparent, double-walled and has insulating features. It comes in 3
sizes: 90 ml, 300 ml, and 500 ml. These cups are suitable for hot and cold drinks,
soups, muesli, ice cream, and sauces
References:
Zero Waste Europe (2018), (reCIRCLE, no date)
6. DABBADROP (UK)
Overview:
DabbaDrop is a start-up in London, UK developed based on the traditional lunch/daily
meal delivery with reusable and returnable tiffin carriers. DabbaDrop provides weekly
changing menus and delivers the dinners weekly or fortnightly. The basic setup of the meal
includes a salad, curry, dal, rice, and roti. Each Dabba box contains 4-stacked tins which
can feed up to 3 people. Delivery is done by bicycle as the mode of transport.
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“WE WANT TO CHANGE THE WAY BRITAIN DOES TAKEAWAY
Through better food. No waste. Fair pay. Zero emissions.
Since we started in November 2018, we have saved over 50,000 plastic
containers from being used by delivering in our dabbas (updated Oct
2020). We have also made over 25,000kms of emission-free deliveries!”
(DabbaDrop, no date)
Tracking technology: (DeliverZero, no date)
None
How it works:
1. Customers pre-order the DabbaDrop meal through the website, specifying the
quantity, start date, frequency of delivery, day of delivery, and time slot
2. Food is delivered on bike according to the order, and can be skipped, canceled,
rescheduled at any time
3. Empty Dabba boxes will be collected on the next delivery
Payment scheme:
Customers pay GBP 28-30 for each delivery, depending on the delivery address.
Material of product:
4-stacked tin boxes
References:
(DabbaDrop, no date), Ellen MacArthur Foundation (2019)
7. DELIVERZERO (New York, USA)
Overview:
Launched in New York City in late 2019 with a standalone mobile app, DeliverZero
provides food delivery service to customers with a network of now 139 restaurants in
Manhattan and Brooklyn.
“DeliverZero began out of a need we experienced in our own lives.
DeliverZero's founders—Adam Farbiarz, Byron Sorrells, and Lauren
157
Sweeney—are all working parents. Returning emails and spearheading
bathtime often take priority over cooking. At the same time, we’re deeply
concerned about the future of our planet. We don’t want to add to the mess
our kids’ generation will have to clean up.” (DeliverZero, no date)
Tracking technology:
Unknown
How it works:
1. Through the DeliverZero mobile app, customers pick a restaurant and order
delivery or pick up
2. The food comes in reusable containers
3. Customers return the containers within six weeks, either to the delivery person
upon the customer’s next order, or drop them off at any of DeliverZero’s partners.
Otherwise, customers pay to keep the containers for themselves
4. The restaurants clean the containers to prepare for reuse
Payment scheme:
Restaurants are charged “a fraction of what the big delivery companies take” by
DeliverZero, about 10% commission fee, while competitor food delivery apps could take
up to 20% commission.
Customers can use the containers for free as long as it is returned within six weeks,
otherwise, they will be charged USD 3.25 plus tax for each container that they keep.
Material of product:
Durable plastics (PP) container which are BPA free, microwaveable and dishwasher-safe.
It can even last over 1,000 uses. The containers come in three sizes: one of a typical lunch
box size, then two cylindrical packaging in different sizes
References:
(DeliverZero, no date), Chapman (2021)
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8. GOBOX (Portland, Oregon, USA)
Overview:
GO Box is a mobile-app based service which provides reusable takeout containers to
restaurants in Portland, Oregon, USA. It started in 2011 with only three participating
vendors. By 2018, it has 70 partner vendors as well as 40 corporate customers. Distribution
and pick-ups by GO Box employees are done with bicycles as the mode of transport.
“Our mission is to provide locally reusable packaging for locally made
products. We know that building a local circular economy for reusable
packaging will require dynamic partnership from many diverse
stakeholders. To that end, we are committed to supporting local
producers & customers who want to transition away from single use
packaging by providing a system of reusable packaging that is safe and
sustainable in our operations, transparent in our impact reporting &
dedicated to building a future where natural resources are valued and
honored through reuse.” (GO Box, no date)
Tracking technology:
QR Code
How it works:
1. Customers go to a vendor/restaurant and use the vendor code to submit into the GO
Box app
2. Customers specify how many reusable boxes they want to check out and confirm
to the restaurant
3. Customers return the reusable boxes to a designated drop-off site and scan the QR
code to end the rent
4. Customers specify the number of reusable boxes they want to return
5. The boxes are cleaned and redistributed to the vendors by GO Box (restocking of
containers is done weekly)
Payment scheme:
159
For vendors/restaurants, the service fee varies depending on the number of containers
needed, ranging from USD 75 to USD 150. They are also open for custom quotation for
vendors with multiple outlets or private cafeterias.
For customers, there are four different subscription plans paid annually or monthly,
depending on the number of reusable boxes they can use at a time (borrow 1-4 boxes at a
time). The smallest “credit” is to borrow only one box at a time, for USD 21.95 per year,
and the highest is to borrow four boxes at a time for USD 40 per year.
Material of product:
- unknown
References:
(GO Box, no date), Baker (2018)