(GUF) THE PERFECT DMO

The UK’s Deposit Return Scheme (DRS), set to launch in October 2027 needs an efficient, well-funded, and experienced Deposit Management Organisation (DMO) to oversee it. In theory, the Tesco, Coca-Cola, and AG Barr consortium has all the right ingredients to make it a success:

✔ Experience in packaging & logistics
✔ Dominant market share in retail & soft drinks
✔ Financial strength to fund infrastructure

But does this "perfect mix" actually mean they are the right choice to run the system, or could their vested interests compromise the very thing the DRS is meant to fix? The new standalone, not-for-profit company would be charged with handling up to 20 billion containers a year across the UK, as well as setting deposits and handling fees.

Why This Consortium Could Be the Best DMO for the Job

1. Market Share & Industry Power

• Tesco is the UK’s largest supermarket, with vast experience in supply chain logistics and handling customer transactions—both critical for DRS refunds and returns.
• Coca-Cola is the biggest producer of single-use drinks containers, giving them unmatched insight into packaging and recycling operations.
• AG Barr (Irn-Bru, Rubicon) has direct experience with Scotland’s DRS and lessons learned from its failure.

In short, these companies know the system inside out. If anyone can roll out a smooth, efficient return scheme, it should be them.

2. Financial Firepower

A DMO must:

• Finance reverse vending machines (RVMs) in supermarkets
• Build a logistics network for collection & processing
• Handle billions of transactions & refunds annually

Coca-Cola, Tesco, and AG Barr have the financial clout to fund this upfront, making it far less likely that the scheme will collapse before it starts, as happened in Scotland.

3. Supply Chain & Retail Reach

For DRS to work, return points must be widespread, accessible, and easy to use.

• Tesco alone has 2,700+ stores in the UK—perfect for a nationwide deposit return system.
• Coca-Cola has existing logistics networks that could be repurposed for bottle collection.

If this group runs the DMO, there’s a higher chance of a seamless, well-integrated system from day one, but can we trust them to run it fairly? Can a group of the UK’s biggest drinks producers and retailers be trusted to manage a system that effectively holds them financially accountable?

• Will they set deposit rates too low to reduce costs?
• Will they resist expanding to glass bottles or higher deposit values?
• Will they prioritise their own supply chain efficiency over the broader circular economy?

The last thing the UK needs is a DRS controlled by industry giants who might undermine it to protect profits.

Possible Conflict of Interest

While Tesco, Coca-Cola, and AG Barr have the resources to make DRS work, they also have a financial incentive to minimise costs. Scotland’s failed DRS showed what happens when industry controlled bodies squeeze the system too tightly, they collapse before they even launch.

The solution?

If this consortium becomes the DMO, there must be:

• Full transparency on decision-making
• Strict government oversight to ensure fair pricing & operation
• Independent voices (waste management, environmental groups) in governance

Final Verdict: The Best Option - If Done Right

The Tesco-Coca-Cola-AG Barr consortium is, on paper, by far the most capable group to run the UK DRS but their dominance could be a double-edged sword ensuring success or creating a flawed system driven by self-interest. So, should they get the contract? Only if strict oversight is in place to ensure they deliver a fair, transparent, and effective DRS - not just one that works best for their bottom line. 

Personally, I think they can and should be given the green light; we can't afford another scheme to fail on lack of trust issues. More like this (DRS) - link - more like this (Coca-Cola) - link