A sustainable business model for refillable packaging in the cosmetic industry: Integrating the learnings and best practices of five leading brands

Abstract

Plastic packaging overconsumption in the cosmetic industry has led to considerable environmental degradation. Given the climate emergency, there is an urgent need to reinvent the business models of the sector and integrate sustainability dimensions. The thesis explores how circular economy principles, specifically refillable packaging, can be integrated into the cosmetic sector to create a Sustainable Business Model (SBM). As the literature is scarce on sustainable business models for refillable packaging in the cosmetic industry, the main contribution of the study is to propose an integrative model, which provides a comprehensive view of the key elements for a successful refillable packaging implementation. To answer the research question "How to build a sustainable business model for refillable packaging in the cosmetic industry?", the study integrates the sustainable business model frameworks of Antikainen & Valkokari (2016) and Bocken et al. (2018) and builds on an extensive literature review to create a conceptual model. The conceptual model is then enriched and challenged through a multiple-case study of five leading cosmetic companies with refillable packaging to construct the integrative model. These case studies offer valuable insights into the best practices and learnings associated with the refillable transition. Our research shows that the refillable transition, driven by consumer awareness and environmental considerations, is overall perceived as straightforward and natural for cosmetic enterprises. Findings depict several points of attention for a successful implementation in different categories of the SBM: a value proposition that tackles the triple-bottom-line, a value creation with close partnership with near laboratories and various stakeholders, research activities before the refillable launch, and effective communication to explain the system upon the launch, a value capture with financial incentives both for businesses and customers and lastly, a value delivery with adequate channels and an emphasis on customer satisfaction. The study provides managerial implications and can encourage decision-makers in the cosmetic industry to transform their current linear operations into circular ones, by embracing refillable packaging. Additionally, the integrative model contributes to the existing literature by giving further insights into the topics of refillable packaging and sustainable business models in the cosmetic industry. Hence, it can serve as a foundation for future research on these topics.