Enabling Return: Reverse Logistics and the Role of Deposit Refund Systems (DRS)

Reverse logistics and deposit refund systems (DRS) are essential for making reusable packaging work at scale. Without effective reverse logistics and strong consumer incentives, packaging does not return—and reuse systems fail. This article explains how reverse logistics and DRS function together to enable high return rates for reusable packaging

Why Reverse Logistics and Deposit Refund Systems Matter?

Reverse logistics and deposit refund systems ensure that reusable packaging is collected, returned, and reintegrated into the reuse loop. Reverse logistics brings packaging back, while DRS motivates consumers to send it back.

Reverse Logistics Essentials are

1. Collection Points: Retail drop-offs, vending-style return kiosks, or door-to-door collection (e.g., Bisleri’s 20L jars in India).
2. Transportation: Consolidation of empty packaging into return loads (“backhauling”) to cut costs and emissions.
3. Sorting & Inspection: Packaging must be checked for quality before reuse.
4. Washing & Sanitization: Compliance with food-grade standards, with traceability where needed.

Deposit Refund Systems (DRS): How They Enable High Return Rates

A Deposit Refund System works by charging a small deposit upfront, which is refunded upon return. This creates a behavioral incentive that dramatically improves return rates. Proven benefits of the system are

1. High Return Rates: Often above 90% in EU beverage systems.
2. Consumer Engagement: Deposits act as a behavioral nudge.
3. Financial Viability: Costs of recovery are offset by deposit pools and secondary revenues (re-sellable materials).

Coca-Cola (Latin America & EU) –  Refillable glass bottles with deposit schemes, and Nordic Countries – DRS for bottles/cans integrated with municipal waste systems are some of the successful examples of DRS system.

India’s PWM rules currently mandate reuse but don’t yet mandate DRS for reuse packaging. However, EPR frameworks and state-led pilots are exploring it for PET bottles and beverage jars. For Indian businesses, combining home collection (e.g., Bisleri) with in-store deposit models could create hybrid return systems suited to urban and semi-urban contexts.

Reverse logistics and DRS are two sides of the same coin. Logistics ensures packaging gets back; DRS ensures consumers send it back. Together, they create the infrastructure and behavior change needed to scale reuse.