The big picture
- The sustainability of packaging is becoming an increasingly more challenging topic for consumer goods companies and retailers alike, but it also represents a sizable opportunity if the right strategy is pursued.
- There is a unique window of opportunity to establish retailer-led circular ecosystems for packaging—materially increasing the sustainability of the packaging portfolio, securing access to scarce feedstock and sustainable materials, thereby avoiding expected higher future costs and unlocking future growth bottlenecks while also capturing packaging cost savings.
- Closing the loop along the value chain with a set of partners (and/ or ownership over the most critical steps) will become essential to securing the recycled content and more sustainable materials, and yet also avoiding unnecessary costs.
- In addition, optimizing and harmonizing the packaging portfolio has the potential to reduce the overall consumption of packaging—and the associated cost—significantly, reduce greenhouse-gas emissions, avoid potential compliance risks, and meet evolving consumer needs.
- Given the increasing demand for recycled and sustainable materials, the transition to circular practices will come at a high price to consumer goods companies and retailers if they do not act now to secure access.
The challenge at hand
ALDI SOUTH Group is a leading retailer with a growing global footprint. Today, ALDI uses a range of packaging materials, of which plastics represent a significant share. Plastics are used both in internal operations as well as in product packaging. However, today’s plastic packaging portfolio consists of a wide variety of formats and different polymers.
The fact that retailers typically do not have control over most of the packaging waste exacerbates the challenge to move to a more sustainable packaging ecosystem. This makes reducing greenhouse-gas emissions, packaging costs, avoiding potential compliance risks, and meeting consumer needs ever more challenging.
Results achieved
To move to a more sustainable packaging ecosystem and secure greater access to recycled plastic, we worked with ALDI SOUTH Group to build an ecosystem with players along the entire value chain. Key achievements include:
- Full 360° view of the company’s plastic packaging footprint—across countries, polymers, and packaging formats.
- Value chain strategy (especially what to own and where to partner) to improve the sustainability of the packaging portfolio and to secure access to recycled polymers to meet targets—with significant cost avoidance.
- Identification and sizing of levers to reduce the use of plastics, harmonize polymer types, and increase the share of recycled material.
- Identification of potential partners along the value chain, with concrete partnership options presented and in discussion.
- Set up of a new organizational structure dedicated to sustainable packaging with new capabilities, and organization-wide processes to prepare the company for circular practices.
- Comprehensive upskilling of employees, with a focus on product packaging optimization, packaging design, partner management, recycling, and waste management.
Looking ahead, these efforts will help ALDI SOUTH Group be a leader in sustainable packaging. Not only will the emerging ecosystem allow ALDI SOUTH Group to use more sustainable materials, secure more recycled content, reduce overall plastic packaging consumption and capture cost savings, but it will also enable them to reduce overall greenhouse-gas emissions and lay a foundation for future growth. Going forward, in the ever-accelerating race for sustainability, this will enable ALDI SOUTH Group — with over 7,100 stores in 11 countries — to create value for customers who want to make more sustainable choices and reduce their own carbon footprint.
