Eliminate the Idea of Waste – Close the Loop – Terracycle business model
WHERE: worldwide (USA + 20 countries)
WHEN: Starting 2001
WASTE MANAGEMENT HIERARCHY: Recycling: Reuse – Reprocessing
TYPE OF INSTRUMENT: Voluntary and Educational
WASTE STREAMS: Complex waste streams – almost every type of waste (a special attention being paid to hard-to-recycle waste)
About: TerraCycle is the world’s leader in the collection and repurposing of complex waste streams (including hard-to-recycle waste like used cigarette butts, coffee capsules, school pens, ocean plastic, oral and beauty care products, plastic gloves). The waste is collected through manufacturer-funded programs that are free to the public, as well as Zero Waste Boxes that are purchased by end users for recycling from homes, offices, factories and public spaces. The collected waste is converted into a variety of raw materials that are sold to manufacturers, which produce new products out of them.
In this way, TerraCycle practically “eliminated” the idea of waste, by recycling the “non-recyclable.”
The company has partnerships with individual collectors, major consumer product companies, retailers, manufacturers, municipalities and small businesses across 21 countries.
Photo Source: Terracycle
The main objective of TerraCycle is to reuse, upcycle and recycle waste (instead of incinerating or landfilling it), turning waste streams from a linear system to a circular one and allowing it to keep cycling in the economy.
TerraCycle conducts its activity based on the premises that the profitability needs to work for everyone participating to the value chain:
a) Corporations: the platforms they fund produce meaningful return on investment (ROI) to clients/partners, through a variety of measures – from driving increased market share and incremental sales to in-store foot traffic and employee retention.
b) Collectors: hard-to-recycle waste is collected by tens of millions of people in cities, schools, businesses, and even at home.
c) Citizens: incentives are provided to people, beyond the accomplishment of recycling, by donating money per piece of waste collected to their favorite charity or school and by incremental promotions to win everything, from playgrounds made from recycled toothbrushes, to gardens from cosmetic waste for a local community in need.
d) Own business: by applying this strategy and science in its activity, logistics and promotion, TerraCycle proves to be a profitable business.
Engaged – over 177 thousand active collection centers in the USA
– Collected – hundreds of Millions of hard-to-recycle wastes per year
– Partnerships with hundreds of major brands and retailers
– Until November 2018, over 80 million people in 21 countries have helped to collect and recycle enough waste to raise over 21 million dollars for charities around the world.
TerraCycle is an innovative recycling company that has become a global leader in recycling hard-to-recycle waste. It combines strategy, logistics, science and technology, promotion and custom business models, which makes each of programs a profitable and scalable platform for its clients, their customers, as well as TerraCycle itself and its shareholders, while eliminating the idea of waste.
Also, TerraCycle differs from other waste management company in the world, their offices around the world being made entirely from upcycled waste, with walls covered in ever-changing graffiti from local artists, thriving on a culture of transparency and high-energy innovation.
The company is in a continuous process of developing its activity, using new technologies. Recently, it added medical waste (used sharps) to its recycling programs. Using EPA-approved sterilization technology, it has developed a system that provides contaminant exposure protection and high-efficiency material recovery. In this way, they are providing a real alternative to incineration for med waste customers who want to see the materials recycled.
By using commercial steam disinfection (autoclave) of medical waste and then processing the sharps to separate metals, plastics and glass, TerraCycle can reclaim valuable materials and divert waste from the landfill.
The system is claimed to provide better, more measurable elimination of biohazards and lessens the linear use of resources.
Engaged participatory processes
Through its partnerships, TerraCycle engaged a massive participatory scheme, at international level (across 21 countries), which includes:
– Individual collectors
– Major consumer product companies
– Small businesses.
The TerraCycle free recycling programs are funded by brands, manufacturers and retailers around the world, helping waste generators to collect and recycle hard-to-recycle waste. By simply choosing the recycling program from the platform, people can start collecting at home, at school or at office. After collecting the waste, it will be labeled with free shipping labels and sent TerraCycle to be recycled. Rewards for schools or favorite non-profit can be earned.
In order to enhance a more efficient waste collection in communities, TerraCycle has introduced public drop-off locations, in locations indicated on the free recycling program index.
Municipal programs : many municipalities work with TerraCycle to provide a public program for recycling cigarette butts and other difficult-to-recycle waste streams. TerraCycle can work with municipalities, organizations or businesses to help their communities start a recycling program, by setting up public or private on-site recycling programs for waste streams.
Although cigarette waste is the most common waste stream cities are recycling with TerraCycle, the company also offers a variety of other programs that can help people to recycle.
Through a free national platform, district city platforms and event-based waste collection (all of these engaging millions of citizens), TerraCycle is collecting and recycling millions of cigarette butts across USA, into a variety of products from benches and ashtrays to industrial products like shipping pallets.
Once collected, the cigarettes and packaging are shredded, separating the ash, tobacco and paper from the plastic filters. The ash, tobacco and paper are then composted and the plastic filters (made from cellulose acetate) are then shredded, compounded and finally made into plastic pellets that are then made into a variety of products.
As a successful consequence of this programme, cities can dramatically lower litter rates by funding such platforms, and tobacco companies are able to show strong corporate social responsibility.
Also, an important mean to engage communities is based on custom-built programs, through which communities can participate to the creation of a collection locations network, for the purpose of reducing waste, as well as fundraising for local schools and charities.
TerraCycle can offer support in setting up collections in public locations to begin recycling waste from the residents in a city, by:
– Collaborate with the school district to set up programs in every school
– Establish drop-off locations at local business locations to collect acceptable waste from customers
– Install public collection receptacles throughout the city in partnership with the municipality and its partnerships (works very well with cigarette recycling)
– Work with local NGOs, to fit TerraCycle’s recycling programs into current operations and raise money for the organizations.
Main partnerships concluded by TerraCycle and waste traceability for collected waste:
1. Target retailer – nationwide campaign to incentivize families in recycling their old baby car seats (bonused with 20% off coupon towards a new baby car seat).
Through a unique process developed by TerraCycle, the old baby car seats are broken down into various fibers, metals and plastics ready for processing into new sellable materials.
2. Bausch + Lomb – free recycling program for contact lenses and their packaging through a free national platform that allows anyone in the USA to send in their contact lenses and packaging, engaging today thousands of locations across the country.
Once received, the contact lenses and blister packs are separated by composition and cleaned. The metal layers of the blister packs are recycled separately, while the contact lenses and plastic blister pack components are melted into plastic that can be remolded to make new recycled products.
3. Tom’s of Maine – free recycling program for natural care products and packaging, as well as a fundraising opportunity for participants, via a free national platform that engages hundreds of thousands of collectors.
Once collected, the hygiene products are separated by composition. The separated items are then cleaned, shredded, and made into new recycled products.
4. Colgate – free national recycling program for toothbrushes, toothpaste tubes, and other dental products, across thousands of schools, dental offices and other locations across the USA.
Once collected, tubes, brushes and other waste streams are separated by composition, shredded and melted into various plastics. The plastics are then remolded to make a variety of products from school supplies to playgrounds.
5. Brita – free recycling program for Brita products (old carbon filters, pitchers, dispensers, bottles, faucet systems, and filter packaging via thousands of volunteer locations across USA).
Once the used products have been collected, they are separated by composition and shredded to make new recycled products. The carbon from the filters are separated for use in polymers as a colorant.
6. Febreze – free recycling program (Air Care packaging waste and aerosol containers), via a national platform that is free to all consumers.
Once collected, the aerosol containers are safely punctured, and any residual gases and liquids are removed. The containers are then broken down into plastic and metal components. Plastics are cleaned and melted into new plastics, and metals are smelted into ingots for reuse.
7. Tide – free national recycling database for laundry bottles, then free collection of Tide packaging where local solutions are not available.
If collected, the #5 caps and #2 bottles are cleaned and melted into hard plastic that can be remolded to make new recycled products.
8. Office Depot OfficeMax – free recycling program for old binders.
Once the used binders have been collected, they are separated by composition and shredded to make new recycled products.
Over the past 100 years, the amount of waste that humanity produces has increased by almost 10,000 percent. It is estimated that 25% of total waste ends up in the oceans, forming 5 gigantic gyres of garbage. Only a small percentage gets recycled, the majority being deposited in landfills, leaching out methane and other toxic outputs over time. If it is not buried, it is typically burned in incinerators.
While a very small percentage of incinerators produce some energy as an output, in the process they also destroy all possible value except the caloric (or energy) value inherent in the materials.
Through science, technology, processes and mass logistics, TerraCycle turned the once unrecyclable waste into value. Recognizing this as a good practice, major consumer product companies were interested in participating to this scheme, as they found out that they can profit from recycling items that could not be recycled before.
Through this approach, TerraCycle promotes the principles of circular economy. TerraCycle’s philosophy is actually based on the fact that „garbage” does not exist in nature:
– In a natural system, any waste generated by one organism becomes a useful input to another.
– With the creation of synthetic materials, humans have broken this natural, cyclical harmony. While plastics and other man-made materials have allowed us greater and more cost-effective innovative freedom, when they reach the end of their life, they become useless garbage that has no place in nature’s healthy cycle of input and output.
Therefore, TerraCycle encourages people to realign with natural processes, by buying consciously, durable or used goods, or simply not buying at all, so that individual consumption can have a smaller impact on nature.
Given the successful story of TerraCycle’s work in creating a supply chain for ocean plastics, it focuses now on a new challenge – the launch, in January 2019, of a transformational Loop platform – a disruptive ecosystem for CPGs (Consumer Packaged Goods) that will eliminate waste altogether.
The practice’s sustainability relies on the process it has been designed. Rather than focusing on a single waste stream for recycling and then building the infrastructure around it, TerraCycle have built the processes to design a profitable recycling solution for almost everything considered as waste.
The process encompasses a holistic approach, from collecting the hard-to-recycle waste to offering science-based solutions and, finally, scalable models:
a) Waste collection: TerraCycle inspires and motivates businesses, NGOs, communities, schools and individuals to collect various waste streams on a massive scale (typically those that no one else can recycle)
b) Solutions: the use of science and technology enables to determine how to optimally transform large quantities of non-recyclables into manufacturer-ready, raw materials.
c) Business model: design a profitable equation for each client—from driving market share, to in-store foot traffic, to offering a competitive advantage that differentiates the brand or product, all in a scalable platform.
To make the business more sustainable, TerraCycle has an official online retailer (“DwellSmart”), a company that reduces waste by finding innovative uses for materials others deem garbage. The collected materials through TerraCycle programs are upcycled into affordable, high-quality products sold through this online shop.
The TerraCycle success model made possible its development and extension in the world. At present, TerraCycle activates in:
– Europe: 12 countries – Spain, France, Switzerland, Austria, Belgium, Germany, UK, Ireland, The Nederlands, Denmark, Sweden and Norway.
– America: Canada, Mexico, Brasil
– Asia: China, South Korea and Japan
– Australia and New Zealand.
A very important recognition of TerraCycle’s sustainability consists in the over 200 awards for social entrepreneurship and sustainable business (including the USA Environmental Protection Agency, Inc. 500, Forbes).
Also, in 2017, TerraCycle received the United Nations Momentum for Change Lighthouse Activity award for turning plastic collected from oceans into Head & Shoulders shampoo bottles.
The success factors are based on the win-win situation for all parties involved – examples:
– Joining any number of programs, start collecting at one’s location, download free shipping labels, and send the waste to be recycled can be made in a very simple way by everyone interested. Also, most free programs offer incentives for schools or charity as a „thank you for collecting and Eliminating the Idea of Waste®”.
– Retailers have the occasion to promote a positive image, gain a better brand reputation, become recommended brands, increase the in-store foot traffic, increase their sales and market shares and improve the employee retention.
The information presented above was taken from public sources, and assessed by UrbanWINS experts according to the project requirements, field research, deductions and analytical process. Key assumptions and projections may deviate from the opinions presented by author, this may typically be the result of differing time horizons, methodologies, contexts or other factors.
We do not assume any rights or guarantees, the sources of all data can be found in the „References” section, in the document. At the time of publishing, we did not received a point of view from the owners/beneficiaries of the practice (although have been requested an official position to the authors, via e-mail), and it can be withdrawn simply by email notification.
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