FWD Column: A moment for wholesale to lead

The deposit return scheme is happening, says Tom Gittins, Chair, Food & Drink Wholesale UK (FWD), as he explains the challenges and opportunities it presents for the sector

The deposit return scheme (DRS) is coming, and while there is still detail to be confirmed, the direction of travel is clear. For wholesale, the question is not whether the DRS will happen but how we make sure our sector is ready, engaged and positioned to benefit from it.

Over the past year, Food & Drink Wholesale UK (FWD) and Scottish Wholesale Association (SWA) have engaged with Exchange for Change on behalf of members to ensure the wholesale and convenience retail voice is heard as the scheme develops. That engagement is making a difference. The establishment of a Wholesale Working Group with wholesalers and Exchange for Change exploring the potential role we can play in supporting the DRS through backhaul and related services that are commercially viable is an example of that.

The UK-wide scheme is currently scheduled to launch in October 2027 and while that may sound some way off, key decisions are being made now. The deposit level is expected to be about 20p and confirmation of the retailer handling fee and other key levers should come this year. These decisions will shape how the scheme works commercially across the supply chain.

Chance to lead

It is easy to see the DRS purely as a compliance exercise or an operational challenge. It will certainly bring administration, logistics and cost considerations, but I believe that we should also look at this as an opportunity for wholesale and convenience to lead.

One of the biggest risks is that a DRS changes shopping behaviour and footfall.

That is why it is so important that the convenience and wholesale channel has engaged early and fully with the scheme. If we get this right, we can protect and, potentially, increase footfall for independent retailers and the customers that wholesalers serve.

In other countries where DRS has been introduced, people come in to return containers and then make a purchase while they are there. This is an opportunity the convenience channel should not miss.

Learnings

I learnt a great deal on a recent study tour to Ireland, the key takeaway being how smaller convenience stores have been supported through the DMO with grants to help with the cost of buying a reverse vending machine for their stores. This is vital to ensure convenience can be involved in the scheme and remain central to local communities.

There are lots of learnings from other territories, with some having had schemes in place since the early noughties.

There are also opportunities for wholesalers directly. Some may choose to become reverse vending operators, support customers with collections or play a role in logistics and returns handling.

More broadly, the DRS sits within a much bigger sustainability agenda. The UK is targeting a 90% collection rate for drinks containers by 2030, and the wholesale sector has an important role to play in helping the country get there.

Food & Drink Wholesale UK will continue to keep members informed, represent the sector in discussions with Exchange for Change and make sure the wholesale voice is heard as the final details are agreed.

Ultimately, the success of the DRS for our sector will depend on engagement across wholesale and convenience. If we work together and prepare early, we can ensure the scheme works for our channel, supports our customers and contributes to the UK’s sustainability goals.

Wholesale has always been a sector that adapts, finds solutions and keeps the supply chain moving; the DRS is another moment where we need to do exactly that.

Deposit Return Scheme Exchange for Change Food & Drink Wholesale FWD Scottish Wholesale Association sustainability Tom Gittins