Products of Change

“We’re just seven years away from the global deadline to achieve the targets set out in the 2015 Paris Agreement to keep global warming below 1.5ºC and limit the potentially devastating impact of climate change and biodiversity loss upon all life on the planet.”

Box-clever: Unpacking the Packaging EPR

This month, Products of Change’s editor Rob Hutchins explores the topic of Extended Producer Responsibility, its role in ushering in a true circular economy why, if it isn’t already, this new tax needs to be on everybody’s radar

The Products of Change member and award-winning international toy maker, Wow! Stuff got itself ahead of the game when it set about overhauling the packaging design of its popular range of The Gruffalo toys last year. Working under the stewardship of Products of Change’s material and packaging ambassador, Mike Swain, the toy team underwent a thorough process of redesigning its packaging concepts from the inside out, stripping out all its single-use plastic to ‘go naked’ and present an ‘all cardboard’ solution to its packaging woes. The process was kickstarted by the desire to ‘do the right thing by the environment’ by brand owners Magic Light Pictures and the innovative toy maker. The by-product of the project is that Wow! Stuff is now sitting in a more advantageous position when it comes to dealing with the heavy-duty legislation coming our way in 2023. So do all toy companies that have taken up the task of reducing their plastic packaging over the last year or so… we know there’s an encouraging number of you. We’re just seven years away from the global deadline to achieve the targets set out in the 2015 Paris Agreement to keep global warming below 1.5ºC and limit the potentially devastating impact of climate change and biodiversity loss upon all life on the planet. With that 2030 deadline edging ever closer, you can bet that demands on your business are going to really start ramping up. Not just from a consumer standpoint, but from new rules and regulations that are starting to be brought in to bring businesses into alignment. Chief concern this year is the Extended Producer Responsibility tax; a new legislation that does pretty much what it says on the tin – vastly increasing the scope of responsibility of the producer of packaging when it comes to end of life and transferring the onus from consumer to producer when it comes to the cost of recycling or disposal. It’s here to replace the current Producer Responsibility or PRN laws and lands in addition to the Plastic Packaging Tax that was introduced in April 2022 - you know, the tax that has now got packaging producers paying £200 per tonne of virgin single-use plastic packaging? The Plastic Packaging tax came with a get-out clause – introduce 30% recycled content into your plastic packaging and avoid paying the charge. The Extended Producer Responsibility law, by contrast, is going to impact everyone. But right now, no one knows exactly how. Details on the legislation remain – perhaps purposefully – vague. What we know is that producers are going to need to start collecting data on all their packaging from 1st January 2023. The tax will be incremental – hitting the harder to recycle materials with bigger charges than materials that are easier to process at end of life. Materials used and weight of packaging are the fundamentals being targeted here. The lighter your packaging and the better recyclability your material use boasts, the less you’ll have to pay the tax man. “It’s about breaking away from a linear system – take, make, throw away,” says Mike Swain, Products of Change’s packaging and materials ambassador. “It’s about redressing that balance of those highly inefficient and highly irresponsible gross practices we’ve done in the past. “It’s also about replacing those legacy Producer Responsibilities or PRN systems and making them bigger. And it will be global. The execution will be different from region to region, but this will apply to every market globally.” For a company like Wow! Stuff, the tax paid on its Gruffalo toy range now devoid of single-use packaging is going to be less than it would have been before the design makeover. The overarching aim of the tax – similar to the European Green Deal that is currently under review in Brussels right now – is to nudge packaging producers into the circular economy and begin to develop reuse and refill solutions. True circularity in this way has been pinpointed as the fundamental system that will drive down emissions and reduce plastic pollution, and the UK Government has claimed it wants to be at the forefront of that transition. “This is a very important steps towards a circular economy,” continues Mike. “It’s not the final solution as there are a huge number of other things we need, but this is a key stepping-stone towards it.” Likewise, Products of Change wants the licensing, toys, and wider consumer products industries to be on the best foot when these incoming regulations start to take effect. It’s why we’ve been working across the membership to develop our Packaging Workstream with updates from packaging and design experts, retailers including Tesco, and industry peers from the licensing sector to facilitate conversation, collaboration and new design approaches to packaging that begin to stem our dependence on single-use plastic. In fact, a Products of Change Packaging Guide will be made available to all Products of Change members via the online platform very soon. While the current wording surrounding the Extended Producer Responsibility legislation makes it difficult to ascertain exactly who in the licensing industry’s licensor-licensee

dynamic will be responsible paying the EPR tax right now, there’s no reason that collectively we shouldn’t all start gathering the right data on our packaging now – because data on this will be the key. “We know this is the right thing to do. There’s a lot of work coming our way, and we’re the ones that have to do it. But that means we are the ones with the chance to make a better future for those to come and take our place, which is why we know we must succeed,” said Helena Mansell-Stopher, founder of Products of Change. Of course, the legislation is going to shine a whole new spotlight on the important role that design will have to play in the sustainable future of our industries. It’s true that 95% of a products impact is determined at design stage. New legislation means the same – or similar – will soon be said of cost. On Wednesday, 11th January 2023, our packaging guru, Mike is hosting a 30-minute introductory session on the Products of Change online platform into new processes and approaches to design waste out of your packaging from the ground upwards. The session will set the stage for a larger, one day course to be taking place in March 2023 in Central London. Design is going to be crucial in the coming years. So will, we ought to mention, the way in which the licensing and toy industries begin to transition to the true circular economy – through reuse, repair, and refurbishment as a means of keeping materials out of the waste stream altogether and retained at their highest value state within the system. The international toy brand, Schleich could be about to pioneer a new model for the toy industry through its Cradle to Cradle initiative to produce all Schleich toys from sustainable and recyclable material by 2027. Beyond that, however, the team is working on new processes of toy recycling that will mean a pre-loved, end-oflife Schleich toy can come back to the German toy manufacturer and be recycled back into a Schleich toy – retaining its material value like-for-like. Success in this area could set a new precedent for sustainability in the toy sector, driving a system closer than ever before to a true Circular Economy. This, obviously, extends past packaging but given what we know about the European Union’s lean into reuse and refill and driving circular principles in packaging so far, we can only expect that product circularity won’t be far behind.

Step Changes to Sustainability

Dr. Gummer’s Good Play Guide insists it needn’t be a big leap for licensing

As consumers we all know we need to do ‘our bit’. Progressively the impact of cutting out single-use plastics, the move to a slow fashion movement, and making smart choices about what and where to shop is being woven into our buying patterns. The Good Play Guide conducts independent reviews, led by child psychologist and parenting expert, Dr. Amanda Gummer. The guide rates toys and games across different criteria including educational and development value, fun and entertainment. To address a commitment to making the world more playful AND sustainable, products reviewed by the guide now have features called out which support sustainability or have some positive eco-credentials, which in turn help consumers looking to make conscious choices when purchasing products and gifts for their children. As an industry how easily can licensed toys and games align their processes to more sustainable strategies and deliver relevant play value? Dr. Gummer sets out how licensors, licensees and retailers can make (even tiny) steps to driving industry change and meeting consumer demands for products with more eco-friendly credentials, supporting sustainable play.

Licensors can set examples

Licensors should spend time to inspire licensees in their product development missions. Much content is now positioned around sustainable and eco-friendly practices and many themes within programming and content do address a move to being more planet-aware - whether that be Peppa Pig on a beach clean, or The Gruffalo inspiring children to get outside and explore our forests. If licensees are inspired by the relevant story-arcs in the programming and brand content it can help foster sustainable changes to product development. Evolving sustainability brand guides to spark ideas around material use and considering the number of samples that are demanded by licensees as part of product development can support a circular approach to reducing waste at every stage of the manufacturing cycle. Actions, behaviours and themes that children, see, hear and are exposed to in the early years can be a foundation for learning and even habit forming for the long term. Whether this be content or themes on screen, or play formats, products and packaging - licensors and manufacturers can make smart choices that needn’t mean a whole new supply chain or strategy shift to being that ‘little bit greener’. Licensors can work smartly with licensees not only to ensure earthfriendly key themes of story-telling are highlighted, but to encourage the development of products that are either built to last – with enhanced play value, or manufactured with sustainability in mind. Some might call these timeless classics or heirloom toys, we call them – great play value!

Licensees should aim to engross children in play

Good examples of toys and games which are developed for multiple players are wonderful in that they promote frequency of play as there are often many different outcomes

and winners! This consideration of play patterns can have a real impact on the green credentials of a product, even if they haven’t been built with the highest eco-friendly credentials of location of manufacture or materials. If something is built to last, is robust and can offer open-ended ways for children to get involved it’s of course less likely to ultimately end up in landfill. Toys that allow children to explore and play, stretch their imaginations beyond the characters they see on TV or online, and inspire curiosity are always going to be picked off the shelf and played with more frequently and for longer periods. These are the toys that will stay in the family, will be passed down from siblings or be a favourite that is always brought out at family gatherings and seasonal occasions. How we play can learn a lot from how we dress ourselves! It’s thought that the re-sale fashion industry has the momentum to surpass the fastfashion sector within 10 years, with consumers making conscious choices about how, when, what and from whom they buy. A wholesale moveaway from a throwaway culture in how toys and games are developed not only supports child development and promotes curiosity but supports a movement of reusing and resharing as much as recycling after use. Customer service functions to enable product repair, spare part supply or take back schemes will also support a brands ‘slow play’ movement whilst importantly staying top of mind when buying decisions are being made by consumers. Watching how children play and learn through interacting together can inspire new product development aligned to earth-friendly strategies. Examples include constructive play toys, which are great to teach children about co-ordination, building and problem solving – whether it’s building a fort, a flower or a fairy castle this type of play encourages re-build, repitch and the power of ‘trying again.’ Dress up and role play categories also give children a work out for the mind, with each ‘try on’ a new adventure to explore – when children play together in a pretend-play situation the only limit to the play is their imaginations.

Story telling at retail

We would advise that retailers don’t just consider product material and packaging credentials when looking to buy more sustainably. It’s worth thinking about play patterns to support parents concerned about being caught in over-consumption, and consider having a mix of toys across best-selling licences that deliver on repeat play as well as being trends of the moment. Toys made of natural materials by design encourage creativity and discovery, therefore inspiring learning and development. We know that children connect faster to their environments and surroundings when their imagination is heightened, so there can be a balance between toys that are made with clear concern for the planet in terms of the production process but also the themes of play are also crucial. Products that have been reviewed successfully by The Good Play Guide carry an accreditation which can be displayed at retail, helpful for shoppers when making decisions in a competitive market. However, sometimes the latest musthave, is exactly that, but if it delivers joy there is a certainly a positive play benefit. Our advice is to balance a brand portfolio with items which reflect the trends of the moment, but can also be offset with toys, games and other licensed items which foster longer term play. Sense-check your sustainability credentials or retail offering by thinking about play formats, the educational and developmental value from each play, the frequency of play and the longevity of the product. If your product is built to last and this is reflected in the way we can all get involved and have fun, then being more sustainable really can be child’s play. “Toys made of natural materials by design encourage creativity and discovery, therefore inspiring learning and development. “