This article first appeared in Digital Edge, The Edge Malaysia Weekly on March 28, 2022 - April 3, 2022

Accelerated by the Covid-19 pandemic, the growth of e-commerce shows no signs of abating. Even as lockdowns, which propelled both businesses and consumers to go digital, are no longer part of the landscape, online shopping is by all accounts part of the new normal. 

According to Statista, a leading provider of market and consumer data, retail e-commerce sales amounted to about US$4.9 trillion worldwide last year. This figure is forecast to grow by 50% over the next four years, reaching about US$7.4 trillion by 2025.

Malaysia is following a similar trajectory, reporting a 23.1% year-on-year increase in the first nine months of 2021 to RM801.2 billion, according to the Department of Statistics. As more businesses establish an online presence and digital adoption rises, this trend looks set to stay. 

The convenience and ease of online shopping aside, environmentalists, consumers and retailers have flagged one issue of increasing concern — packaging waste. Statista estimates that the global e-commerce industry used about 2.1 billion pounds of plastic packaging in 2019. It projects that e-commerce plastic packaging use will continue to grow in the coming years, reaching an estimated 4.5 billion pounds by 2025.

A December 2021 report by Oceana, an international organisation focused on protecting and restoring the world’s oceans, found that Amazon generated 599 million pounds of plastic packaging waste in 2020. This is a 29% increase from Oceana’s 2019 estimate of 465 million pounds. The report also found that Amazon’s estimated plastic packaging waste, in the form of air pillows alone, would circle the Earth more than 600 times. By combining the e-commerce packaging data with findings from a recent study published in Science, Oceana estimates that up to “23.5 million pounds of Amazon’s plastic packaging waste entered and polluted the world’s waterways and oceans in 2020, the equivalent of dumping a delivery van payload of plastic into the oceans every 67 minutes”.

At home, the Malaysian Recycling Alliance last year said packaging makes up a major portion of the country’s waste. Although it is not known how much of the packaging waste stems from e-commerce activities, suffice to say it is an issue many consumers as well as those involved in online sales are trying to wrap their heads around.

HappyFresh Malaysia managing director Hu Hun Hui admits that it is a weighty issue, especially from the environmental angle. “Packaging waste is something that everyone is talking about, from the customers to retailers as well as we at HappyFresh,” he says. In an effort to address the matter, some of the retailers such as The Food Purveyor have stopped using plastic bags for orders made on the grocery platform, replacing them with woven bags. HappyFresh, which launched HappyFresh Supermarket in November 2021, on the other hand uses only carton boxes for each order. It is also exploring the use of boxes of varying sizes to suit the size of orders.

Although the elimination of plastic packaging is not possible on the platform, the next best thing would be to ensure there is minimal waste. “We monitor the usage of plastic bags that go out with the orders. All our packers are told to use only one piece of plastic per order and are taught to pack the items as efficiently as possible,” says Hu. 

At Everleaf, an organic product platform offering frozen food and fresh vegetables, CEO Clarence Chin says customers can choose zero-waste packaging for their vegetable orders. “The plastic packaging is removed and the vegetables are then weighed and packed in a carton box,” he says, adding that some 30% of its regulars now opt for zero-waste packaging.

Zero-waste packaging, however, is not without some disadvantages — especially when it comes to fresh food items. “It’s difficult for us to ensure that there will be no damage to the produce because without the plastic packaging, the vegetables can get heat burn. Our climate is also a challenge in ensuring the vegetables stay fresh without any packaging,” he says, adding that Everleaf’s packers are taught to layer the vegetables with the more fragile ones on top.

Chin says that repeat customers are also given the option of returning the carton box and receiving a RM1 credit for their subsequent purchase. At HappyFresh, Hu says the option of reusing the woven bags has been considered but given the pandemic, it is not viewed favourably by customers. Since January, he says the platform has been experimenting with zero-waste packaging with select customers in Ara Damansara and Kajang.

Both Everleaf and HappyFresh point out that packaging waste needs to be addressed all along the supply chain, specifically at the start. Everleaf, which also operates a storage and fulfilment centre, says many of the brand owners it works with are unaware of the packaging options. “So it’s up to us to suggest packaging options to ensure freshness,” says Chin, adding that often it is a balance between eco-friendly packaging choices and food safety.

In the case of AllSome, a fulfilment platform for e-commerce sellers, it is supporting its e-commerce sellers’ eco-friendly efforts by partnering with suppliers who produce degradable poly mailer bags and recycled poly mailer bags. “As AllSome is currently relying on poly mailer bags from delivery partners to pack the parcels, recently we have started to look at go-green packaging materials,” says its founder and chief technology officer Ng Yi Ying. She adds that AllSome plans to produce degradable poly mailer bags and recycled poly mailer bags in the next quarter.

In considering alternative packaging, she says the quality of the packaging material needs to be looked into. “It has to serve its purpose as a packaging material to protect the parcel content. It has to be presentable. The first impression is important for sellers to impress the buyers. So, the packaging material will need to look clean and new for brands to make a great impression on buyers,” she says.

She adds that cost is another important factor, pointing out that though there is little difference between the cost of recycled poly mailer bags and non-recycled ones, degradable materials are more expensive. “As the degradable material is not ubiquitous, some suppliers will require high production volume, which is less cost-friendly for sellers.”

In the food and beverage industry, eco-friendly packaging options offer alternatives for restaurants going green. Team Recycler is a Malaysian start-up making eco-friendly, compostable food packaging, and has been supplying them to GrabFood merchants. Its founder Lau Weng Kien says, to date, some 250 merchants — from GrabFood merchants to hotels, restaurants and cafés — are using its range of OEM sugarcane-based food packaging products, including lunch boxes, bowls, cornstarch straws and wooden cutlery.

Although more environment-conscious customers are behind the push for food and beverage outlets to replace plastic packaging with eco-friendly options, Lau says the rising price of plastic is also behind the switch. “Rising cost of petroleum means that sometimes, plastic packaging costs the same or just a little bit less than the eco-friendly substitutes. So for many F&B operators, it makes sense to pay a bit more and make the switch. It also puts their brand image in a positive light — customers love that these restaurants are going green and, ultimately, it helps with sales,” he says.

He discloses that the sugarcane-based packaging is 100% biodegradable and would decompose in 180 days. Those made from cornstarch, meanwhile, take 18 months to break down. But not all of Team Recycler’s products are made from biodegradable or compostable materials, as plastic is used for some of the container lids.

Nonetheless, Lau feels that switching to eco-friendly packaging for food deliveries and takeaways is a step in the right direction. Based on its 2021 sales, he estimates that some 60 tonnes of plastic packaging — from plastic boxes to straws and cutlery — have been diverted from landfills. “This is still very small compared to the 148,000 tonnes of plastic packaging that was used in 2020, but we are trying our best,” he says. 

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