Waste

Business Case

Financial resilience

Waste is a direct cost: every unit of material that becomes waste represents procurement spend that delivered no lasting value. Reducing waste means getting more productive use out of every dollar spent on materials, as well as avoiding potential exposure to landfill taxes, EPR fees and penalties. Recovered materials can be resold or reintegrated into production, transforming waste management from a cost center into a source of cost avoidance or revenue.

Market access

Companies with strong waste performance are better positioned in tenders where waste reduction is an evaluation criterion, particularly with institutional buyers and government procurement bodies.

Productivity and quality

Waste reduction improves material utilization rates, meaning procurement teams can meet the same production needs with lower material volumes and lower spend, driving greater efficiency across the supply chain.

Regulatory and policy alignment

Waste reduction in procurement directly supports compliance with expanding producer responsibility regulations, national circularity targets and international commitments under SDG 12.5 (reduce waste generation) and SDG 12.7 (sustainable public procurement). Companies aligned with these frameworks are better positioned for government contracts, avoid regulatory penalties and reduce exposure to externality costs such as resource depletion and environmental remediation that are increasingly being priced into markets.

Strategy & Planning

Assessment

Initial Action

Conduct a spend analysis to identify applicable hotspot categories with high waste, virgin material use or disposal costs, identifying the top categories generating the most operational waste or requiring frequent disposal.

Intermediate Progress

Map EPR, take back or end of life requirements by market for the products procured and analyze value chain for priority categories to identify opportunities for waste elimination, diversion and material recovery.

Advanced Practice

Conduct comprehensive end-of-life mapping across all procurement categories to identify remaining waste streams without recovery pathways and conduct on-site waste audits to better understand drivers of waste in mixed material waste streams heading to landfill or incineration.

Policy

Initial Action

Publish a simple waste hierarchy (Prevent > Reuse > Repair > Recycle > Recover > Dispose) in the procurement policy and require its consideration for purchases based on alignment with production and operations teams, with basic waste reduction expectations for procurement, prioritizing avoidance and reuse over disposal.

Intermediate Progress

Set targets and create plan to achieve zero waste for procured materials, including banning procurement of single-use disposable items that generate avoidable operational waste (e.g., plastic water bottles, disposable cutlery) as appropriate based on operating context (industry, geography, regulation and jurisdiction).

Advanced Practice

Adopt 'zero waste to landfill' as a strategic policy for procurement, with mandated pre-consumer waste (industrial by-products) to be reintegrated into supply chains and requirements for TRUE Zero Waste certification for suppliers (or similar, e.g. UL 2799).

Targets

Initial Action

Set targets for percentage of suppliers in priority categories reporting waste volumes and disposal methods.

Intermediate Progress

Set targets for percentage of suppliers with waste reduction improvement plans, including defined milestones for eliminating avoidable waste from procured products.

Advanced Practice

Set targets for percentage of procured materials operating within closed-loop systems or with contractual end-of-life accountability, where materials are recovered, reprocessed and reintegrated into production rather than disposed of.

Supplier Selection

Screening

Initial Action

Ask suppliers to disclose waste from procured products, including current waste goals, relevant waste diversion metrics and any Zero Waste certifications for relevant facilities.

Intermediate Progress

Request detailed waste management information from suppliers, including recycling or reuse options for top waste streams, downstream destinations for recovered materials and residues, packaging diversion practices, segregation infrastructure and waste management plans with reduction targets.

Advanced Practice

Mandate full material traceability (from origin to end-of-life) using blockchain or other digital product passports as a condition of bid compliance. Require suppliers to have certified closed-loop waste recovery systems.

Selection

Initial Action

Prioritize suppliers that demonstrate basic waste tracking and can provide waste diversion data.

Intermediate Progress

Allocate points in selection criteria for suppliers demonstrating:

  • verified waste diversion rates
  • active waste reduction programs
  • reuse‑first waste strategies, where materials are recovered for high‑value applications before recycling
  • end-of-life collection or take back capabilities
Advanced Practice

Select suppliers demonstrating independently verified zero-waste operations, closed-loop waste recovery systems and cascaded waste requirements to their own supply chains.

Contracts

Initial Action

Include contractual clauses requiring suppliers to report on waste generated from procured products and comply with prohibited disposal methods.

Intermediate Progress

Include clauses on:

  • enforceable waste reduction targets with defined consequences for non-compliance
  • requirements for periodic waste performance reporting (as appropriate based on operating context (industry, geography, regulation and jurisdiction)
  • evidence of legal compliance with local waste‑handling and reporting regulations
  • requirements for suppliers to phase out non‑recyclable packaging formats
Advanced Practice

Require suppliers to cascade waste reduction and end-of-life recovery clauses to their own suppliers, with suppliers taking responsibility for waste outcomes across their supply chain (as appropriate based on operating context (industry, geography, regulation and jurisdiction).

Supplier Engagement

Goal Setting

Initial Action

Create joint waste reduction goals with key suppliers, communicating waste policy requirements and establishing shared action plans for reducing waste from procured products, including packaging waste diversion and end-of-life collection.

Intermediate Progress

Set specific, time-bound waste reduction targets with suppliers, such as achieving defined diversion rates, eliminating specific waste streams, implementing take back programs for waste recovery or meeting packaging diversion targets.

Advanced Practice

Set goals with Tier 1 suppliers on cascading waste reduction requirements to their own suppliers (Tier 2 and 3) and establishing multi-year targets for verified zero-waste operations, packaging diversion and end-of-life recovery across the supply chain.

Capacity Building

Initial Action

Conduct waste reduction training for suppliers, covering waste hierarchy principles, waste stream identification, basic waste tracking methods, packaging diversion and EPR compliance fundamentals.

Intermediate Progress

Train suppliers on waste auditing techniques, contamination‑prevention practices to ensure recyclables remain high‑value, closed-loop system design, waste-to-resource conversion opportunities and EPR compliance strategies.

Advanced Practice

Provide advanced training to suppliers on implementing zero-waste management systems, TRUE certification requirements, designing closed-loop waste recovery infrastructure, using AI‑supported waste‑sorting and monitoring systems and managing EPR obligations across their own supply chains.

Data

Initial Action

Request baseline waste data from suppliers in priority categories, including waste volumes by type, current diversion rates, disposal methods, packaging waste volumes and any existing take back or collection programs.

Intermediate Progress

Support suppliers in developing structured waste tracking systems to enable systematic monitoring of waste volumes, diversion rates, recovery outcomes, packaging waste diversion and take back program performance.

Advanced Practice

Work with suppliers to develop integrated waste reporting systems that capture waste generation, diversion, recovery, packaging waste and take back program data across their own supply chains.

Certifications

Initial Action

Share information on relevant waste management certification programs, such as TRUE Zero Waste and UL 2799.

Intermediate Progress

Sponsor suppliers in high‑impact waste categories to participate in recognized zero-waste or waste management certification programs.

Advanced Practice

Require zero-waste certification (TRUE or equivalent) for strategic suppliers in high-impact categories and support Tier 2 suppliers in achieving certification.

Advisory

Initial Action

Provide guidance to suppliers on identifying their highest-impact waste streams and implementing basic waste reduction measures, including packaging waste diversion and end-of-life collection options.

Intermediate Progress

Provide technical expertise to suppliers on implementing waste reduction strategies, such as waste auditing methodologies, waste-to-resource conversion options, end-of-life collection design and packaging diversion systems.

Advanced Practice

Consult and work with suppliers in embedding waste reduction, end-of-life recovery and take back programs into their own procurement practices, including developing their own supplier codes and engagement programs on waste.

Financial Support

Initial Action

Fund supplier access to waste auditing tools, waste tracking systems and waste management training resources.

Intermediate Progress

Provide commercial incentives to suppliers for improvements in waste reduction performance, such as price, volume, duration and preferred supplier status.

Advanced Practice

Co-invest with suppliers in waste recovery infrastructure, such as collection systems, sorting facilities or processing equipment; and link contract terms to verified progress on achieving zero-waste operations across the supplier's own supply chain.

Audits

Initial Action

Require suppliers to complete self-assessment questionnaires on waste management practices, covering waste generation, disposal methods, diversion rates, packaging waste management, take back programs and any waste-related certifications.

Intermediate Progress

Conduct on-site or third-party supplier waste audits, including verification of diversion rates, recovery processes, downstream material destinations, packaging waste diversion, zero-waste claims and take back program functioning.

Advanced Practice

Require and support strategic suppliers to conduct their own waste audits across their supply chains and share findings, including waste volumes, diversion rates, recovery outcomes and take back program performance at sub-tier level.

Project Partnerships & Innovation

Initial Action

Launch pilot waste reduction projects with key suppliers to identify and address the highest-volume waste streams from procured products, including packaging waste diversion pilots.

Intermediate Progress

Scale successful waste reduction pilots into operational programs or joint waste-to-resource projects where recovered materials from procured products are returned to suppliers as production inputs.

Advanced Practice

Lead industry collaborations with suppliers, waste management partners and sector peers to develop shared waste recovery infrastructure and standardized end-of-life collection systems, co-developing closed-loop waste recovery systems to collect, process and reintegrate post-consumer and post-industrial waste back into production at scale.

Continuous Improvement

Metrics

Initial Action

Track the following:

  • total waste generated from procurement activities
  • percentage of priority categories with completed waste assessments
  • percentage of suppliers providing waste data
  • number of suppliers engaged in waste reduction initiatives
  • number / percentage of suppliers engaged in buyer waste reduction programs
Intermediate Progress

Track progress indicators such as:

  • waste diversion rates (recycling, composting, reuse)
  • packaging waste volumes and diversion rates
  • number of products sourced with end-of-use strategies
  • waste cost calculations in total cost of ownership analysis
  • take back program volumes and recovery rates
Advanced Practice

Track indicators such as:

  • percentage of suppliers with verified zero-waste-to-landfill operations
  • percentage of strategic suppliers with cascaded waste reduction requirements
  • EPR compliance rates across the supplier portfolio

Scorecards

Initial Action

Introduce basic waste criteria into supplier evaluation forms covering waste tracking capability, diversion rates, disposal method compliance, packaging waste management and participation in waste reduction initiatives.

Intermediate Progress

Integrate waste reduction KPIs into supplier scorecards and contract renewal decisions and require corrective action plans for suppliers with poor waste performance.

Advanced Practice

Weigh waste performance in supplier scorecards, with top performers receiving preferential weighting in tenders and bottom performers required to submit improvement plans.

Impact Verification

Initial Action

Gather feedback from suppliers on effectiveness of waste reduction engagement programs and feasibility of waste requirements.

Intermediate Progress

Assess whether supplier engagement initiatives are delivering measurable waste reduction outcomes and cost savings and validate improvements through independent teardown assessments comparing current to prior design generations.

Advanced Practice

Measure:

  • financial value recovered from waste-to-resource initiatives and value retained through reuse/refurbishment
  • total cost avoidance from waste reduction across the supply chain, including avoided procurement and disposal costs
  • environmental outcomes (embodied carbon reduction, waste prevention, resource efficiency improvements)

Sources consulted

Design Soil