Putting high-quality recycled plastic into the world’s supply chains
Andrew Almack started his company with the belief that he could make a profit while simultaneously alleviating poverty and a major environmental problem. As he believes, “We are entering a new phase of capitalism where the world’s biggest challenges are becoming the world’s biggest business opportunities.”
The challenges that Almack identified were created by the mountains of plastic waste forming in the rapidly expanding cities of South America, Africa, the Indian subcontinent and Southeast Asia, all of which lacked the infrastructure or finances to deal with them. At the same time, these cities have been seeing a significant influx of migrants from surrounding impoverished rural areas, sometimes as a reaction to climate change-related flooding.
Many new urban arrivals, with no qualifications or training, start working as plastic-waste collectors, retrieving what they can in exchange for tiny amounts of unstructured remuneration from waste disposal companies. Canadian-born Almack, who is now based in India after studying the economic feasibility of recycled marine debris during his time at Bishop’s University in Quebec, recognised that “recycling systems are fundamentally built on poverty in the emerging economies.” He decided to create a recycling business that was, in his words, both fair and efficient.
In 2012, Almack started Plastics for Change in Bengaluru (Bangalore), India, as a non-profit. It was the first recycling company in the world to be certified by Fairtrade1. The company was then re-established officially as a for-profit in 2015. To deal with the collection and distribution of the waste plastics, the enterprise developed a system whereby the scrap shops issue a buy/sell transaction on its app. The plastics are then picked up by his team and taken to its aggregation centre where the material goes through a comprehensive segregation process to ensure a consistency quality for the brands. To sell high-quality plastic to multinationals, the company assures excellent sorting, fair salaries and quality-control procedures.
Plastics for Change has three main revenue streams. First, some 70% of revenue comes from selling the collected plastic as a raw material to consumer brands for recycled use. Almack notes, “We source a consistent supply of high-quality recycled plastic for these responsible supply chains that are third-party verified.” The second form of income comes from the merchandising division, which sells finished goods made with the recycled plastic directly to brands for resale. The third pillar of the enterprise is particularly innovatory. Using a ‘plastic credit revenue’, similar to carbon credits, businesses are able to purchase plastic credit, which helps to offset their plastic use and allows the company to support the repurposing of some of the harder-to-recycle materials that otherwise would not enter the circular economy.
The business concept is profiting from social good and leveraging their massive centres for good. It starts with a socio-geographic need assessment when choosing a new plastic collecting centre location. “This helps us to understand what the holistic approach is to what development needs are required within these communities.” He goes further. “The first thing is always to try and cure poverty. If you can get someone a regular payment into their bank account every month, that is a brilliant way to alleviate poverty.” The team also looks at the communities in which their plastic collectors live and work, where it sets up crèches and childcare facilities and ensures access to healthcare.
A vital differentiating factor for the enterprise is the importance of sustainability. According to the Ellen MacArthur Foundation, only approximately 2% of plastic packaging is made from recycled plastics, a statistic that is alarming and one that Almack is actively trying to improve. “The key to helping brands transition away from fossil fuel-based plastics is to ensure we get the quality right, and that the segregation process is correct,” Almack explains. “If it’s a high-quality product, with the right technology and infrastructure, it can be recycled again.”
The high consumer demand for recycled plastic is the mirror to their biggest challenge. Plastics for Change believes that this starts with ensuring the livelihoods for the people that are picking up the waste plastics. “We need to design the supply chain so that each stage of the value creation is profitable, that the economics of recycling really work.” With this in mind, the company is looking to international expansion in Southeast Asia, starting with the Philippines, where it can continue its work of social good.
“Consumers are voting with their wallets and choosing brands who are creating a social impact through recycling. Solving the social and environmental issue of plastic waste is an enormous business opportunity.”
Biography / key highlights
2012 Plastics for Change founded
2018 Almack named in the Forbes ‘30 under 30’ list
2019 Plastics for Change recognised as a verified Fairtrade company