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Interview with Michael Newman

Michael Newman
Michael Newman
CEO
Returnity
Returnity

Reusable packaging is a driver towards circular models
Returnity creates custom designed, reusable and recyclable shipping packaging for individuals and businesses, providing a sustainable packaging solution for a better customer experience and engagement. Paulami Chatterjee talks to CEO Michael Newman about how the company is geared up to replace over 6 million cardboard boxes and poly mailer bags with reusable packaging this year.

What is the carbon and water footprint of your solutions?

Our work with Green Story in Canada suggests that our packaging reduces energy consumption by 86 per cent and water use by 97 per cent over the lifespan of use-but that is an 'average' case. Actual material choices and customer shipping models have significant impacts on the company-specific impacts.
 

Who are the founders of Returnity? Give us some background about your company.

Returnity Innovations was founded in 2014 and is headquartered in Brooklyn, New York. Returnity is the pioneer in the elimination of single use shipping packaging, reducing packaging expenses and while providing a financial return, improved user experience, reduction of workplace injuries and significant reductions in resource consumption. Each year more than $60 billion is spent on packaging in the US alone-and used once. The solution is reusable packaging and the larger shift from linear business models to sustainable circular models, a move we empower through the development of easy to implement systems. We will replace the use of over 6 million cardboard boxes and poly mailer bags with reusable packaging in 2019 and 10 million+ in 2020. 

I have built a base of expertise in environmental policy and grassroots activism (the Sierra Club), start-ups (stkr.it, Climb) and reverse logistics and supply chain (ReCellular) for 20 years. That knowledge base led Returnity investor Brian Spaly (Bonobos, Trunk Club) to help bring me in as CEO of Returnity in 2017.  My work as CEO is the perfect intersection of those previous experiences in sustainability, supply chain and systems change for major corporations. Our advisors and investors include James Reinhart (ThredUp), Arthur Rubinfeld (Starbucks), Andy Rendich (Grove Collaborative), Jennifer Fleiss (Rent The Runway), Brian Spaly (Trunk Club), David Meckler (Merlone Geier Partners), and Annika Durball (PVH).

How big is your team? What are the various work positions in your team?

We are split between two offices; our product engineering and prototyping staff sit in Santa Cruz, California, and sales, account management and operations are all in Brooklyn. We will continue to expand both offices through 2019 to meet the major increase in business we are experiencing.

How many bags do you manufacture in a month on an average? Do you make them in-house or outsource their manufacturing?

Returnity provides in-house engineering capability to customise every order. We have an exclusive manufacturing partner in China and are able to manufacture 100k+ units per month. Our partner is BSCI business practice certified, and therefore committed to improving working conditions in the global supply chain, which is important to us. 
How many bags do you manufacture in a month on an average? Do you make them in-house or outsource their manufacturing?

Offering pick-ups and returns of re-usable packaging can be tricky. What are the common bottlenecks and what are you doing to improve this?

We have taken a two-step approach to this problem. Our core customers like Rent the Runway have circular shipping models that incorporate the return as a standard component of their business. Though this model is growing quickly, it still represents a small percentage of overall shipping.

In parallel we are working with shipping companies like DHL and a number of national postal services to design closed-loop logistics systems that make it easy-and cost-effective-to reaggregate empty packaging. We believe that customer subsidised or incentive-based programmes are not the way to truly scale a switch to reusables; it will take the hard work of building truly cost-effective systems. 

What is the background of Returnity engineers who custom design packaging solutions?

Members of our team have decades of experience in supply chain and logistics, graphic design, sustainability and mechanical engineering. They have worked with and for companies such as Walmart, Verizon, AT&T, Best Buy, The Home Depot, Centurion, Amtrak, American Airlines, Monsanto, USDA, Kuiu, and Homeland Security. What is the background of Returnity engineers who custom design packaging solutions?

Do you cater to every region of the world?

We direct ship from our production partner in China to clients worldwide, and are already active throughout North America and Europe.

What is the most interesting customised packaging you have done for a client?

We are working with a number of furniture companies to build reusable packaging for the delivery of everything from sofas to tables and dressers. Learning how to scale up our solutions to items that are heavy and bulky has been a fun challenge, and we are eliminating the use of an incredible amount of single-use materials in that market. What is the most interesting customised packaging you have done for a client?

Who are your major clients?

We consider our anchor clients to be leaders in the new circular economy, including Happy Returns, Rent the Runway, For Days and others. We are working behind the scenes with a long list of prominent brands on new initiatives that will be launched over the next six months.

How many types of fabric, pattern and imprinting do you provide for the bags?

Everything we make is custom-made to clients' exact requirements. Our default fabric is rPET; it is durable, waterproof, cost-effective and low-footprint, but we use whatever clients want. Many opt for basic black because they don't want to signal what is inside, but others do have us print custom designs or integrate custom zipper pulls, handles and other unique brand flourishes. We've done imprinting on every surface-inside and out.

What materials do you use for customised solutions? Where are the raw materials sourced from?

The life-cycle assessments we have done show that both rPET and standard PET are better over time compared to corrugate or poly mailers. They are produced in-market in China, and are recyclable at the end of their use in standard PET recycling systems. What materials do you use for customised solutions? Where are the raw materials sourced from?

How many companies are you collaborating with to drive sustainability and re-usability?

We have over 100 active clients right now, and average three new leads a day without spending anything on marketing. Companies are actively looking for new ideas in packaging.

What got you selected for the Fashion for Good initiative?

The companies that sponsor Fashion for Good are looking at packaging for two reasons. First, they are consuming an ever-growing amount of resources for the transport of their goods, and are focused on new innovations that can help to reduce that impact. In parallel, they know that reusable packaging can be an important driver in the adoption of new, circular customer models-and we've proven we can enable that new approach.

How do you arrive at a price once you finish custom designing a bag?

Size, quantity and feature set all impact price-but in general our packaging pays for itself after 15 uses and is guaranteed for 40.

How do you want to expand your business? What are your long-term goals?

We are focused on having impact-and impact only comes from having scale. That scale will certainly mean great things for our investors-but more important, it will mean we have made a meaningful reduction in the resource impact of the new e-commerce economy. As such, we are focused on expansion through system development; our ambition is to help build the systems necessary to make reusable packaging a cost-effective, core component of shipping around the world. (PC)
Published on: 12/10/2019

DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.

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