Austrian Retailers Invest €300 Million in New Deposit System

Austrian Retailers Invest €300 Million in New Deposit System

APA/EVA MANHART

Food retailers in Austria have invested around €300 million in reverse vending machines and infrastructure for the new one-way deposit system for cans and plastic bottles, which will take effect from January 1, 2025. This is according to a survey conducted by the APA among supermarket chains. Smaller businesses will receive up to 100% of the costs subsidized, while larger companies will be subsidized between 20 to 40%. The Chamber of Commerce (WKÖ) sees the industry as “well-prepared” for the deposit system, and the Retail Association expects a smooth transition.

The deposit system applies to all single-use beverage bottles and aluminum cans ranging from 0.1 to 3 liters, with consumers paying a deposit of 25 cents. If empty, undamaged bottles and cans with a readable label are returned, consumers will receive their deposit back. The system does not apply to products such as Tetra Paks, milk and medical products, or syrups. Beverage manufacturers are allowed to deliver goods without deposit marks until the end of March 2025, while retailers can continue to sell such products until the end of the year. Next year will see a temporary coexistence of bottles and cans with and without deposits.

All businesses selling beverages with the deposit logo must also accept returns. Exceptions apply to businesses in busy locations, such as sausage or kebab stands, or newsstands, provided they have an agreement with another return station (e.g., supermarkets) within 300 meters. Billa, Hofer, Lidl, and Penny offer return agreements, but Spar does not. Currently, around 70% of single-use plastic bottles are collected after use in Austria. With the new deposit system, the collection rate is expected to increase to at least 90% by 2027.

Industry Representatives: High Effort for Retailers

To implement the new deposit system, food retailers have had to purchase new return machines, adjust their IT systems, and train employees. Many supermarkets have also remodeled their stores to accommodate the new infrastructure. “The introduction of the one-way deposit system represents a significant organizational and financial effort for food retailers,” said Christian Prauchner, Chairman of the Food Trade Committee in WKÖ, in a statement. He pointed out that the cost of return machines starts at around €10,000 to €15,000, with more powerful devices costing between €25,000 and €30,000. Depending on the size of the business, 20 to 100% of the costs are subsidized. The funding primarily comes from the EU’s Next Generation program, with additional funding available from the Ministry of Climate for small and medium-sized food retailers.

The Retail Association estimates that after deducting the EU and Climate Ministry subsidies, the investment by retailers in the deposit system amounts to around €200 million. “The implementation and processing of the new deposit system is a Herculean task for the entire industry, especially for the more than 6,700 independent retailers in the country,” said Rainer Will, Managing Director of the Retail Association. Smaller local suppliers, for example, have limited space to install a return machine.

Spar, Rewe, Hofer, and Lidl Invest €300 Million

Austria’s largest food retailer, Spar, has invested around €60 million in the one-way deposit infrastructure. The subsidies cover about one-third of the investment costs. “We are prepared and ready to go,” said Spar in response to inquiries. The company will not enter into return agreements with sausage stands or newsagents. “Anyone who sells beverages should also take responsibility for collecting the beverage containers and bear the costs of return,” said the retailer.

Rewe, the parent company of Billa, has invested a “high double-digit million amount” in the deposit infrastructure. In addition to return machines at Billa, Billa Plus, Penny, and many Adeg stores, returns will also be accepted at smaller locations and in Bipa stores, manually. “There are no issues with implementation,” Rewe stated. Billa and Penny are offering return agreements with small businesses. Rewe expects “high interest” from small businesses and estimates around 1,300 agreements.

Discount chain Hofer has built extensions for deposit machines at locations with their own parking lots. The transition to the new deposit system has cost Hofer around €128 million. To ensure quick returns without waiting times, most locations—where the building allows—have installed two return machines at the entrance. Hofer offers return agreements to small businesses as long as all legal requirements are met.

Lidl has invested around €45 million for the new deposit system, including necessary refurbishments. The return machines are set up at the entrances of nearly all stores. Customers can also choose to donate their deposit refund to various charity organizations in Austria. Lidl already has some return agreements with newsagents and sausage stands near their stores and expects this number to increase as the deposit system rolls out.

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