As of yesterday (Sunday July 1) single-use, plastic bags became prohibited across commercial businesses around the state. The main entities effected by the ban was the major supermarket chains, with sweeping changes made to Coles and Woolworths in order for their customers to be able to transfer their groceries from the shelves to their pantries.
The environmental benefits of this government measure seem obvious, but it was not just nature sympathisers who had a win. Coles and Woolies also had much to gain from the move to ban the bags.
Barry Urquhart from Marketing Focus has heavily researched the issue and revealed that the lack of plastic bags will save the chains around $100 million per year, and selling the paper or material based alternatives will pocket them an estimated $70 million a year.
This $170 million all up turnaround is only a drop in the ocean for the supermarkets whose profit margins are collectively in the tens of billions, but is money they would prefer to have rather than not, especially considering their steady decline in sales.
“(This ban) particularly at a time when they’ve got squeezed margins, price deflation and market share that is contracting they would be looking at all sorts of things. I guess what you have got to say is what is the driving force that is having this introduced… I suspect to a large degree this is a result of corporate social conscious and corporate responsibility coming into vogue where it is a good thing to be seen doing and to be doing but to a large extent it feels best in the board rooms of St Georges Terrace rather than the outer blocks of Esperance.”
Mr. Urquhart refused to say that this environmental stance, albeit government forced, would win back customer loyalty to the supermarket chains, reinforcing the fact that, at the end of the day, price always swayed the customer.
The Marketing Focus guru also went on to question the full environmental effects the ban would have.
“In a study done in Tasmania, the ACT and Northern Territory which introduced the banning of bags last year before they actually implemented that policy, it was found somewhere between 9% and 20% of people bought bin liners. After the ban came into vogue and people weren’t getting or receiving these free single-use plastic bags his number jumped to 80% of people buying bin liners, now that highlights there is a bit of a misnomer with the term ‘single-use’ plastic bags because interesting enough many people were taking them home and using them as multiple-use bin liners because they were very, very effective.’
Despite this globally the world seems to be trending slowly towards environmentally friendly solutions, with some supermarkets in Europe opting to have a plastic-free aisle. But would these efforts save our crippling environment?
“Does this mean turtles and dolphins won’t be devouring plastic bags in the oceans of the world? I think it will be marginal if any impact at all. There needs to be some fundamental change across the board, and it won’t be because all of a sudden on the 1st of July came into vogue a policy and regulation in Australia to ban one-use plastic bags.
Barry Urquhart and Marketing Focus is on the Sean for Breakfast Show every Monday morning.