Together towards a circular economy: HL's and Tesco's partnership to close the loop

The below article is taken from HL Display's 2020 Corporate Responsibility Report - click here to view this document.

How plastic waste is currently handled globally is a massive problem, not the least because the current structures do not fully support a sustainable end-of-life treatment of plastic and steps towards a circular economy.

One of the largest obstacles when it comes to closing the loop on plastic is the capacity to sort plastic waste – a process that Tesco has successfully put into place.

As a step to minimize their environmental impact, Tesco built a system where they have complete control of their plastic waste streams. This system allows Tesco to recycle and reuse 70 percent of their plastic waste each year and the remaining 30 percent are resold on the market. The 30 percent are partially made up of PVC plastic, which is difficult to recycle, and Tesco is continuously working on finding solutions to close the loop on PVC plastics.

Datastrips brought back to life

As a provider of datastrips made of PVC to Tesco, HL was ready take on the challenge to recycle the material in old datastrips to make new ones.

First, the recycled material needs to be processed to remove all types of contamination. This is key to ensuring that the quality of the new products is not compromised. The front of the new datastrips using recycled material need to have a high transparency to make it easy to read the price labels. They also need to be able to withstand the wear and tear of the retail environment just as well as those made of virgin material, to keep the same lifetime and ensure environmental benefits.

“The initiative shows that Tesco and our supply chain take our environmental impact seriously. HL has worked proactively to find solutions to make this a sustainable, long-term initiative. The recycled datastrips perform just as well as the ones made of new material, and after a few more tweaks, the pilot project will be sustainable going forward.”

Shane Riches, Procurement Manager
- Waste and Recycling at Tesco

During the development process, the HL team worked to find the right balance between performance and cost, being careful not to impact the quality and lifetime of the end product. A very important part of the process has been fine-tuning the amount of recycled material that can be featured in the end product without impacting the quality or the production process.

As for this pilot project, the first of its kind for HL - the recycled datastrips are now being launched in Tesco’s stores, closing the loop on part of Tesco’s waste stream.

Rethinking collaboration in the supply chain

The key to unlocking closed loop solutions is breaking away from the current ways of working, rethinking the transaction model and introducing new players. This is where the importance of collaborating with the whole value chain comes in. Since HL cannot create separate waste streams for its own products, new players need to be added into the mix, like waste management companies. As a datastrip supplier to Tesco, HL has been able to take back sorted PVC waste from Tesco through their waste management company and reproduce it into new datastrips that are reintroduced into Tesco’s stores.

The ground breaking journey to closing the loop on datastrips is therefore three-fold. Through Tesco’s process of handling waste, and thus acting as a collector and source of recycled material, the waste management company’s sorting system and HL’s capacity to clean and handle the used material, a pilot project has successfully been launched.

In this pilot, the value chain has successfully come together, leading to less usage of virgin material and avoiding incineration of the product at end-of-life.

“This project is an example of the shift needed in logistics in order to provide a circular offer. The whole value chain needs to work together and integrate our processes more than ever before.” – Jonas Marking, Senior Product and Sustainability Manager at HL.

The initiative is yet one more step that both HL and Tesco have taken to actively work to reduce their environmental impact, showcasing how proactive collaboration throughout the value chain on joint initiatives are building a sustainable future.

Increasing supply of high-quality recycled material

“We see great opportunities to increase the circularity of our business. This is a top priority. Almost daily we are conducting different trials with recycled materials in our factories," says Jonas Marking, Senior Product and Sustainability Manager.

“The challenge is to balance the customer demand in terms of appearance and cost of the product with the material that is available on the market,” he explains.

During 2020, HL started up a sourcing project for recycled plastic focused on increasing our pool of reliable suppliers of high-quality recycled material.

Moving towards a circular economy

HL is taking active steps to drive development towards a circular economy. In 2020, we began to implement systems to collect our own products at the end of their life to be used as raw material in newly produced items, in order to solve the challenge associated with sourcing quality recycled material as well as to avoid incineration at the end-of-life.

We see great potential to reduce CO2 emissions by closing the loop as approximately 40 percent of emissions come from incineration at end-of-life.*

210 tonnes
recycled material sourced from external parties


“The most challenging aspect to solve is the collection and sorting of used products. In most cases it will not be practically possible to have customers run a separate waste stream for our products," explains Jonas Marking.

“We need to trace the waste from the retailer to try to find the point where our products can be separated from the stream. To solve this, we need to form partnerships with waste management companies and develop new business models with our customers,” he elaborates.

While we have launched pilot projects in this area and we have seen big interest in circular offers, it will take a long time to apply the solution to a wide range of customers, partially due to the challenge of retrieving the material in an efficient way. We have the ambition to develop a circular offer that can be extended across Europe by the end of 2021.

Understanding the impact of our products

It is important to know the environmental impact of our products' whole life cycle and therefore we are actively working to understand this impact. To understand how our products affect the environment and in turn communicate this to our customers to help them make more sustainable choices, we conducted a life cycle assessment (LCA) for datastrips in 2017.

This assessment, done by IVL, showed that 40 percent of the CO2 emissions that are related to our datastrips come from the raw material and another 40 percent come from incineration at end-of-life.

Furthermore, 15 percent of emissions come from our own operations in Sundsvall and the remaining five percent are related to transportation. Our aim is to continue compiling this information by conducting life cycle assessments for at least two more product ranges during 2021.

*Based on the Life Cycle Assessment for datastrips at HL Display AB, study compiled by IVL, 2017