After years of consultation, delay and debate, the UK government has officially confirmed that a deposit return scheme (DRS) will launch in England and Northern Ireland on 1 October 2027.

Set to transform how single-use drinks containers are bought, returned and recycled, the scheme is a game changer for vending operators and beverage providers. From labelling and logistics to consumer engagement and cost structures, businesses in these sectors need to prepare for significant changes.

How it works

At its core, the DRS is simple: consumers will pay a small deposit (likely around 20p) when purchasing a drink in a plastic bottle or metal can. This deposit will be refunded when the empty container is returned to a designated return point, either manually at a vending machine or via a reverse vending machine (RVM).

But behind the scenes, the scheme’s rollout is anything but straightforward.

The government has confirmed that the scheme will apply to PET plastic bottles and aluminium or steel cans between 150ml and 3l, but glass bottles will be excluded from the England and Northern Ireland rollout. This exclusion is a point of contention, especially among environmental groups, and marks a key difference from Scotland’s approach.

All in-scope drinks must carry a DRS-specific label and be sold only by registered producers. Retailers will also be responsible for setting up return points or applying for exemptions.

What this means for vending businesses

For vending operators and beverage producers, the introduction of the DRS represents a fundamental shift in how products are packaged, sold and recycled. Here are some considerations:

1. Revamping vending operations

Vending operators will need to adapt their machines to accept empty containers and process refunds. This could mean upgrading existing machines with reverse vending technology or investing in new units. The logistics of managing returns at high-traffic locations, such as offices, public spaces and transport hubs, will require significant planning.

British Retail Consortium's (BRC) director of food and sustainability, Andrew Opie, said: "Retailers and the BRC have been central to the Deposit Management Organisation's (DMO) development, committing significant funding, time and resource to get to this point and we are pleased that our voice will continue to be heard as the initiative progresses".

"The DMO must now get to work to ensure the smooth delivery of a DRS that works for businesses and consumers. We look forward to engaging with them and the government to ensure that DRS makes a meaningful difference to recycling across the UK.”

2. The rise of reverse vending

As part of the rollout, RVMs are expected to become a familiar fixture in retail and vending environments. These machines allow consumers to return empty drink containers and receive their deposit back automatically, an approach that aligns perfectly with the self-service nature of vending.

With the implementation of DRS in 2027, these machines will provide an essential return point for single-use plastic and metal drinks containers, offering a simple, automated way for consumers to return their empty bottles and cans and reclaim their deposit.

The convenience of RVMs makes them ideal for high-traffic areas – such as vending locations, retail stores and public spaces – where speed and efficiency are key. For vending operators, RVMs represent an opportunity to enhance customer experience while supporting sustainability goals. Not only do they make it easier for consumers to return containers, but they also help reduce waste and improve recycling rates.

RVMs are becoming an increasingly common sight across Europe, and with the UK’s forthcoming DRS, the demand for them is expected to soar.

As more vending machines adopt reverse vending technology, operators will need to navigate the logistics of machine installation, maintenance and integration with the wider recycling infrastructure. RVMs will be essential not only in providing an accessible return point for consumers but also in aligning vending operators with evolving environmental standards.

In addition to the benefits of increased recycling, RVMs offer an avenue for revenue generation. Many models of reverse vending machines can incentivise returners with cash, loyalty points or vouchers for future purchases, making them an attractive addition for businesses looking to improve customer engagement. This could be particularly valuable in the vending and beverage sector, where convenience is a priority for consumers.

With forward-thinking operators already investing in reverse vending machines, now is the time to prepare. RVMs offer a great opportunity to stay ahead of the curve, not just in terms of compliance but also in aligning with consumer preferences for sustainable practices. For vending operators, reverse vending machines are not only a solution to the challenges posed by the DRS, but a strategic investment in the future of the industry.

3. New costs on the horizon

While the deposit will be paid by consumers and returned to them, the administrative costs will not disappear so easily. Manufacturers will be expected to contribute to the scheme’s operational costs – covering everything from material handling to data reporting.

Retailers installing RVMs could face upfront costs of £30,000 or more per machine, with further expenses for maintenance, space allocation and staff training. While this burden will not fall entirely on producers, it will inevitably feed back into pricing and distribution negotiations.

4. Changing how drinks are sold and returned

The introduction of return logistics marks a new layer of complexity in the supply chain. Collaboration with retail partners will become even more crucial, especially for brands that rely on convenience or impulse channels. Smaller stores may apply for exemptions, but larger retailers will be required to manage container returns on-site.

This could impact product placement, promotional strategies and even which formats are stocked where. Producers using harder-to-recycle formats may find their shelf presence diminishing in favour of DRS-friendly packaging.

5. Different rules for different sectors

For drinks consumed on premises – think pubs, cafes or restaurants – businesses will not need to charge a deposit or provide a return point. However, those selling takeaway drinks will be subject to the same rules as retailers.

Online and direct-to-consumer sellers, meanwhile, will need to plan for the additional headache of managing returns remotely – a logistics challenge that has yet to be clearly resolved by government or industry bodies.

A window of opportunity?

Despite its challenges, the DRS could also be an opportunity for brands to double down on sustainability credentials. With consumers increasingly aware of packaging waste and circularity, early adoption and clear communication could boost brand perception.

The scheme also promises to improve recycling quality in the UK, providing high-grade materials that manufacturers can use for new packaging. This could benefit vending operators and beverage producers who rely on a sustainable supply chain.

The DMO has officially been announced as the operator of the new £1.13 billion DRS for single-use plastic and metal drinks containers in England, Northern Ireland and Scotland.

BRC, a key stakeholder in the DMO’s creation, welcomed the news. “A well-designed DRS, with retail at its heart, will be an important contribution to delivering a circular economy in the UK,” said Opie.

The statement continued: "Our work is already underway, and we’ll be working closely with governments, businesses of all sizes, environmental groups and consumer bodies to move forward as quickly as possible.”

Other industry leaders have backed the scheme. British Soft Drinks Association director general, Gavin Partington, welcomed the government’s appointment of UK DMO as scheme administrator for its DRS.

Partington said: "This appointment marks a key milestone in realising the opportunities of a more circular economy, driving £1.13 billion of industry investment over the next three years and creating more than 4,000 jobs across England, Scotland and Northern Ireland. The British soft drinks industry looks forward to playing our part in ensuring successful delivery of a DRS by October 2027.”

Natural Source Waters Association's general manager, Kinvara Carey, added: “This announcement is great news for all involved. The DMO will have a clear focus on developing the most efficient and effective scheme to reduce littering and enable more drink containers to stay in the loop and be given another life.”

Association of Convenience Stores' CEO, James Lowman, highlighted that the appointment of the UK DMO marks a major step forward in bringing the DRS to life across the UK. He underlined the vital role that local retailers and convenience stores will play in the scheme’s success, particularly in offering accessible return points for consumers.

"For the scheme to deliver a step change in recycling rates," Lowman said, "local shops will need to play an integral part, offering a convenient network of return points both for local residents and people consuming drinks on the go."

“We are looking forward to working with the newly-formed DMO to ensure that the scheme is operationally viable and attractive for retailers to take part in. With less than two-and-a-half years before launch, it is vital that retailers can make informed choices about how to take part in the scheme, and we are committed to providing the information and advice they need.”

What businesses can do now

With more than two years before the go-live date, there is still time to prepare – but not to wait.

Audit your product range: Identify which stock keeping units (SKUs) fall under the scheme and begin exploring packaging adjustments.

Speak to suppliers: Ensure your packaging providers are ready to deliver DRS-compliant formats.

Engage your retail network: Retailers will be your front line in delivering the scheme, and so collaboration is key.

Factor in the costs: Ensure you budget for future compliance and keep an eye on how the DRS might affect your margins.

Monitor updates: Sign up to government updates and industry forums in order to stay ahead of any regulatory shifts.

Final sip

The DRS represents a major shift in how we produce, sell and recover drink containers. For operators in the vending and beverage sectors, the challenge is not just about compliance but adaptation: how to stay flexible in a market increasingly shaped by sustainability and consumer expectation.

Whether you’re a multinational brand or a local vending operator, the countdown to October 2027 has already begun. Preparing now will ensure you’re ready to take full advantage of the opportunities, and overcome the challenges, the scheme will bring.