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TerraCycle: Bringing waste full circle

TerraCycle offers recycling programmes for all sorts of complex waste streams – and now it has announced Loop, its new ‘waste-free’ online shopping service. Kate Dickinson talks to Tom Szaky, founder and CEO, about addressing the root cause of waste

Launching a new online shopping system in partnership with some of the world’s biggest brands, it has undoubtedly been a hectic start to 2019 for TerraCycle and its CEO Tom Szaky. “Exciting, but totally nuts”, is how Szaky describes the past few months leading up to the official announcement of Loop in January. But it’s probably safe to say that most years are fairly hectic for the 37-year old Szaky, who founded the recycling company while at university and has since overseen its expansion into 21 countries worldwide – and counting.

Originally from Budapest, Szaky moved between European countries as a child until coming to Canada, before moving to the US for university, where the idea for TerraCycle began to take shape. Moving from what was effectively “refugee status” to living in “the heartland of capitalism” had a big impact on Szaky, who says: “During that process I effectively went from an environment where starting a business was next to impossible, to the heartland of capitalism, and I really fell in love with the concept of business as a tool for change.

Bringing waste full circle
Tom Szaky, TerracCycle CEO

“I wanted to create a business that was profitable, but whose existence was something that the world would be happy about, that the world would look at and say ‘thanks for existing’. I don’t know if the world could say that about many businesses.”

TerraCycle is best known for setting up recycling schemes for hard-to-recycle waste streams that aren’t accepted in standard recycling systems, from cigarette butts and crisp packets to toothpaste tubes and used nappies. These schemes are made possible with sponsorship from the companies creating the waste: for instance, Walkers Crisps funded a recycling programme with TerraCycle after facing a slew of criticism on social media for its disposable packaging.

The main output from this recycled waste is raw material for new plastic products. Szaky explains: “We prefer putting it into products that can then be recycled, and if that’s not possible we try to put it into products that will last an exceptionally long time, like an outdoor playground.” It’s rare, he claims, for the company to encounter a waste stream that can’t be reprocessed: “Where there’schallenges is if the cost is too high, so there isn’t a partner willing to fund – or if there’s regulatory concerns, like medical waste, we can’t legally collect, it has to go to waste-for-energy.”

Questions have been raised about the success of TerraCycle’s many recycling schemes. There are “hundreds, maybe thousands of unique recycling schemes” in existence, Szaky says, with one launching every three days somewhere in the world – but the volume of waste collected, compared to the vast amounts produced by the companies that fund the schemes, is minimal.

Some might suggest an element of ‘greenwashing’ here by businesses that want to appear environmentally friendly without having to redesign their products for easy recyclability. However, Szaky’s vision for TerraCycle is grand: “Our mission is to eliminate the idea of waste – not to manage waste but to eliminate the concept”. And the corporate recycling schemes are just one arm of a business that continues to grow and expand into new avenues, with its latest venture, Loop, seeing the company step out of the recycling camp and into waste reduction.

The concept, Szaky says, is inspired by the traditional idea of the milkman delivering and collecting glass bottles from your doorstep.

Pre-existing products from a range of brands will be sold in newly-designed, durable and reusable packaging. Customers can visit the Loop website, third party retailers or any of the sites belonging to Loop partner companies, and order their everyday products – such as a bottle of shampoo or a pack of nappies – at the standard retail price. They will also need to pay a refundable deposit for the reusable packaging; this could range from “25 cents for, say, a coke bottle, up to €47 (£41) for the diaper receptacle”.

Loop products will be delivered in a ‘shipping tote’; once they have been used up, the customer can place the packaging back in the tote, which will be collected by Loop directly from their home, cleaned, refilled and returned to the consumer. If the customer wants to stop their order, their deposit will be refunded.

It’s an impressive concept, and some big-name brands have given it their backing, including PepsiCo, Nestle, Unilever and Procter & Gamble. In fact, eight of the top 10 companies most responsible for plastic pollution (according to a global litter study by Greenpeace) are signed up to be a part of Loop. The service will be launching first in Paris and New York in spring, followed by London in late 2019. The biggest French retailer Carrefour has agreed to embed Loop into its ecosystem and Tesco will be doing the same in London. However, the proof of the pudding will be whether customers in the first test cities take to the new way of shopping.

Szaky is confident that Loop has solved the question of what the modern consumer wants. “In making Loop, we realised that consumers want to live a waste-free life but, unfortunately, will not sacrifice on affordability and convenience. It’s just the reality. With that in mind, we wanted to create a platform that allowed for us to solve for disposability while maintaining or meeting the convenience provided by disposability.”

This article was taken from Issue 95

The newly-designed packages, he says, offer improved functions – such as Nestlé’s ice cream container designed to keep the product cold for longer on the go – that will entice even those “who don’t care about sustainability and who just want a better consumer experience. That for us is the breakthrough. It’s also why big mega-brands have started getting involved at the rate they have.”

This approach springs from Szaky’s own attitude to waste, which despite his line of work remains pragmatic. “Ironically, Loop was something I wanted to invent for myself. I enjoy buying goods; I try to live a zero-waste life and recycle as much as possible, but I wouldn’t say I’m an optimal example. So the key is for us to be able to create models that will help the average consumer, not just the ones that are already very motivated.

“People are becoming incredibly aware of the problem, especially in the UK, but they’re still voting every day, multiple times a day, for disposability. That’s what we have to solve.”

Loop sprang out of a simple question: how could TerraCycle deal with the root cause of waste? “As we expand and grow more successful, we have realised that recycling is critically important in the short term, as is the integration of recycled content, but it’s not the answer to garbage. It’s the answer to the symptom, but it’s not the answer to the root cause of waste: single-use or disposability.”

Loop poses an answer to that root cause – but whether it will catch on is another question entirely. When the service gets its first test runs in Paris and New York, the eyes of the world will be watching.