The UK Deposit Return Scheme (DRS) is being viewed by many drinks producers and importers as a straightforward packaging compliance deadline, and it’s easy to see why. At first glance, it appears to focus on containers, labels, barcodes, and return points. However, that view underestimates the scale of change involved.
The scheme will introduce new financial flows, data requirements, reporting obligations, customer treatments, and operational dependencies across the value chain. Producers and importers will need to update core areas, such as how products are classified, registered, sold, invoiced, reconciled, returned, and reported.
Treating DRS as a narrow packaging exercise might mean discovering too late that the real impact reaches finance, commercial, IT, supply chain, customer services, legal, compliance, and governance. Those that approach it as a structured business change programme will be far better placed to manage complexity, protect margin, and maintain customer confidence.
What Is the UK Deposit Return Scheme?
The UK deposit return scheme (DRS) is a new system designed to increase the collection and recycling of single-use drinks containers. From 1 October 2027, consumers will pay a refundable deposit when buying certain drinks in eligible containers, including plastic bottles and metal drinks containers like aluminium cans, between 150ml and 3 litres. They will then be able to reclaim that deposit by returning the empty container through an approved return point such as a reverse vending machine.
Exchange For Change, the Deposit Management Organisation for England, Scotland, and Northern Ireland, has confirmed that a flat 20p deposit will apply to all in-scope containers when the scheme launches. Glass drinks bottles will not be part of this scheme in England, Scotland, and Northern Ireland.
Wales is taking a different approach to the rest of the UK. The Welsh scheme is expected to include glass bottles as well as PET plastic, steel, and aluminium containers. However, glass will be subject to a transition period from 1 October 2027 to 30 September 2031, during which in-scope glass containers will carry a zero-pence deposit and be exempt from DRS labelling requirements.
For consumers, the principle is simple: buy the drink, pay the deposit, return the container, and receive the deposit back. For businesses, however, the process is far more complex.
How DRS Creates Business-Wide Change
The scheme aims to support a circular economy, reduce litter, boost recycling rates, and provide a redeemable deposit to encourage uptake. This creates a lot of new responsibilities for producers, importers, retailers, wholesalers, and other businesses involved in placing drinks on the market or selling them to customers.
For producers and importers, the challenge is that the scheme changes the handoffs between departments. Product decisions affect finance, finance treatment affects invoices, invoice presentation affects customer conversations, and stock decisions affect route-to-market execution.
That interdependency is what turns DRS from a packaging task into a business change programme.
Key Areas Producers and Importers Need to Prepare for DRS
To help prepare for the new DRS, let’s look at the key areas of business operations where it will need to be planned, managed, and embedded.
1. Packaging and Product Scope
Packaging teams will play a key role in getting the business ready for DRS; they work to understand container scope, materials, labelling implications, barcode requirements, and pack transition timelines. However, they cannot deliver compliance or operational readiness in isolation.
DRS will sit alongside packaging extended producer responsibility (EPR) and create a separate set of decisions around deposits, producer fees, product registration, reporting, and customer treatment.
For example, a deposit is not the same as a price increase, and producer fees are not the same as packaging costs. These are areas that require new decisions to be agreed, controlled, and embedded across different functions, such as:
- Commercial teams may need to let customers know how deposits will be handled
- Finance may need to account for deposits, fees, and timing differences
- Enterprise resource planning (ERP) and reporting systems may need to distinguish between in-scope and out-of-scope containers.
- Supply chain teams may need to manage old and new drinks containers in parallel
- Customer service teams may need to respond to disputes or invoice queries
- Legal teams may need to review customer agreements and terms
For importers, this can be more complicated. Imported products may need UK-specific labelling, barcodes, product registration, and market allocation controls. Where the same product is brought into the UK by more than one importer, businesses will need clarity on who is responsible for registration, reporting, deposit treatment, and evidence.
If these decisions are made in silos, businesses are likely to experience inconsistent processes, duplicated effort, late-stage system changes, and avoidable commercial risk.
DRS readiness needs to be led as an organisation-wide change programme, with cross-functional ownership and clear governance. Otherwise, it becomes much harder to track and manage decisions, dependencies, and risks.
2. Financial flows
One of the most significant impacts of DRS will be financial. It introduces deposits, producer fees, reconciliation requirements, and potential timing differences that many businesses will not currently be set up to manage.
A flat deposit value of 20p may sound simple from a consumer perspective. For drinks producers, importers, retailers, wholesalers, and distributors, though, it raises several important questions about how these deposits will be managed and governed.
Businesses may also face increased exposure to cash flow risk, credit risk, and margin pressure. Depending on the route to market, deposits may pass through multiple parties before reaching the consumer, while timing differences between sale, settlement, reporting, and reimbursement could create working capital pressure.
These issues mean that DRS is as much a finance issue as a compliance one. Finance teams will need to consider:
- Deposit accounting and balance sheet treatment
- Cash flow timing and exposure
- Producer fee budgeting
- Customer credit risk
- Reconciliation controls
- VAT and tax implications (where relevant)
- Invoice and credit note treatment
- Dispute processes
- Evidence audits and management reporting
For importers, there may also be additional considerations around the point at which products are placed on the UK market, how obligations interact with customs and duty processes, and how responsibility is allocated between overseas brand owners, UK importers, and distributors.
Without early financial modelling, organisations may underestimate the true cost of implementation. The risk is not just that the business fails to comply, but that it complies inefficiently, with unnecessary leakage, margin erosion, working capital impact, or customer confusion.
3. Product master data
The DRS will also place far greater importance on product master data.
Businesses will need to have reliable data on the products they place on the market, including which products are in scope, which markets they apply to, and what materials or formats each container uses. That also means managing different barcodes and product identifiers, as well as how each SKU needs to be treated across finance, sales, reporting, and supply chain systems.
This sounds straightforward enough, right? Businesses should already know their products inside and out. In many organisations, however, product data is fragmented. Packaging attributes may sit in one system while finance treatment sits elsewhere in a separate platform. Historical product records may be incomplete, imported products may not have been built with the DRS reporting in mind, or variants may not be consistently classified. These are all weaknesses that the proposed scheme may expose.
The practical implication is that DRS readiness depends on data readiness. If product data is incomplete, inconsistent, or poorly governed, errors will flow into other areas. That means pricing, invoicing, reporting, stock management, and customer communication will all be impacted.
Businesses should therefore treat the scheme as an opportunity to strengthen data ownership, approval workflows, and product governance. Reliable product master data will be invaluable for processes like:
- Identifying in-scope and out-of-scope products
- Managing England, Scotland, Northern Ireland, and Wales-specific scheme requirements
- Handling pack, barcode, and imported product variant changes
- Enabling accurate deposit charging
- Supporting producer reporting
- Preventing misclassification
- Maintaining audit trails
- Answering customer queries
- Coordinating supply chain transition
This goes beyond whether or not an organisation can identify in-scope products today. They need to maintain accurate scheme treatment as products change, new SKUs launch, packaging is updated, and market rules evolve.
4. Connecting systems and reporting
Data alone isn’t enough to successfully adopt DRS. Businesses will need systems in place that can process, apply, and report scheme treatment consistently.
The scheme will touch ERP, finance, product information management, sales order processing, customer pricing, reporting, warehouse, and supply chain systems. In many cases, existing systems will not have been designed with deposit flows in mind.
The business needs to understand how the DRS treatment moves through the end-to-end process. For example:
- When a product is created, who confirms its scheme status?
- When a sales order is placed, how is the deposit applied?
- When stock is transferred between markets, how is its scheme status controlled?
- When a product is imported, who confirms the reporting responsibility?
- When Wales-specific glass treatment applies, how is that captured?
These types of questions cut across system ownership. A change made in the ERP may affect invoice outputs, or a product data decision may affect warehouse picking. That is why scheme system readiness should be managed as an integrated workstream, rather than as a series of disconnected fixes.
Organisations should map the full process and identify where the scheme’s logic needs to be applied, where data needs to be captured, and where controls need to be embedded. They should also allow time for testing, because many scheme issues will only become visible when processes are tested end-to-end.
5. Customer and route-to-market treatment
Customer and route-to-market treatment will be another important area of change. Customers will need to understand how the scheme affects pricing, invoicing, credits, returns, disputes, and day-to-day trading arrangements.
For many businesses, the answers will not be uniform across every channel. It may require different treatment depending on whether the route to market involves grocery, wholesale, B2B, direct-to-consumer, hospitality, or another channel.
Businesses with complex route-to-market models may need to manage deposits through intermediaries, distributors, or customer groups with different contractual and operational requirements.
The realities of DRS are often much more complex than expected. For customer treatment, teams will need answers to practical questions, such as:
- Will deposits be shown separately on invoices?
- How will customer price files be updated?
- Do customer agreements need to be amended?
- How will account managers explain scheme-related charges?
- How will disputes be escalated and resolved?
- How will promotional pricing interact with deposit values?
- How will returns, damaged goods, or credits be treated?
- How will scheme and non-scheme products be communicated?
- How will imported products be treated where responsibility is not obvious to the customer?
- How will Wales-specific treatment be explained for glass?
If customers or partners receive inconsistent explanations, unclear invoices, or unexpected charges, the result may damage commercial relationships. The best way to prepare for this is to be proactive. Review agreements, update pricing communications, and try to align customer service teams around clear escalation routes.
6. Supply chain and market allocation
From pack treatment and product classification to customer handling and market allocation, the scheme will introduce new layers of supply chain complexity. Businesses will need to manage forecasting, stock build and run-down, warehouse processes, and transition planning through a new lens.
The transition period is likely to be especially challenging. Businesses may need to manage old and new packs in parallel and ensure products meant for one market don’t go to another one. There’s also the increased risk of stranded stock, customer rejections, and incorrectly allocated stock being used after cut-off dates.
All of these new issues mean that operational teams have to think about:
- When to switch to scheme-compliant packs
- How to manage existing stock
- How to forecast demand around launch
- How to prevent incorrect stock allocation
- How to manage products sold across scheme and non-scheme markets
- How to coordinate customer-specific transition requirements
- How to handle returns or obsolete inventory
- How to monitor readiness across warehouses and distribution partners
This is particularly important for businesses with multiple production sites, third-party logistics providers, export channels, or UK-wide distribution. Operational decisions will need to be aligned with commercial commitments, finance treatment, and system readiness.
Wales adds another layer. Glass may be included in the Welsh scheme framework from launch, but with a zero-pence deposit and labelling exemption during the transition period. Producers and importers still need to understand portfolio exposure, customer expectations, data treatment, and future transition risk.
7. Governance and ownership
As DRS affects so many business functions, proper governance is the only way to tackle the changes. It is the mechanism that keeps decisions visible, connected, and owned. Without clear ownership, decisions happen in isolation, which can create delays, inconsistencies, and avoidable risk.
For example, supply chain teams may plan transition dates that don’t align with packaging availability, leading to delays. To avoid these issues, structured governance is the best path forward.
At a minimum, organisations should consider establishing:
- An executive sponsor
- A cross-functional steering group
- Defined workstream leads
- A central decision log
- A risk and issue register
- Readiness milestones
- Data ownership and approval processes
- Customer communication governance
- Finance and reporting controls
- Testing and assurance checkpoints
The main purpose of governance is to make sure decisions are visible, connected, and owned. It also helps maintain momentum, though, which is important. With the scheme scheduled for 1st October 2027, businesses may feel they have time. However, the scale of systems change, customer engagement, data cleansing, and operational planning means many decisions need to be made well in advance.
How Producers and Importers Can Prepare for DRS
Getting ready for DRS should start with a clear impact assessment. This assessment maps out every process impacted by the scheme, covering everything from product setup to supply chain execution. The main aim is to identify gaps, dependencies, risks, and decisions requiring leadership approval.
From there, businesses should build a cross-functional roadmap. Each workstream should have defined owners, milestones, and deliverables. The most important areas to prioritise include:
Product and data readiness
Identify all in-scope SKUs and validate the product attributes needed to support scheme treatment. Establish clear ownership for product master data and make sure new product introduction processes include scheme-compliance checks. Include imported products, GB-wide portfolios, Wales-specific considerations, and products with complex barcode or pack structures
Financial modelling and controls
Model the impact of deposits, fees, cash flow timing, credit exposure, and margin pressure. Then, define how deposits will be accounted for, reconciled, and audited.
Systems and reporting design
Map where DRS logic needs to sit across ERP, finance, sales, supply chain, and reporting systems. Identify whether changes can be automated, where manual controls may be required, and what testing will be needed.
Customer and contract review
Review customer agreements, pricing files, invoice formats, and account management processes. Prepare communication materials so customer-facing teams can explain changes clearly and consistently.
Supply chain transition planning
Develop a detailed plan for old and new packs, stock depletion, production switchovers, imported stock, market allocation, and customer-specific requirements.
Governance and assurance
Create a programme structure with senior sponsorship, clear decision-making, risk management, and end-to-end testing before launch.
The Real DRS Challenge Sits Inside the Business
DRS is a major operational change for drinks producers, importers, and the wider value chain. While packaging is an important part of the response, it is definitely not the only area that will require adjustments. For most businesses, the bigger hurdle is organisational readiness.
The scheme demands coordination between teams that may not usually work together in this level of detail. It requires decisions that affect cash flow, costs, systems, commercial relationships, customer confidence, product data and operational execution.
DRS International works with producers and importers to turn DRS requirements into a structured, practical change plan. We support businesses with impact assessment, readiness diagnostics, implementation planning, and cross-functional mobilisation across the areas that matter most: finance, data, systems, packaging, supply chain, commercial, customer treatment, and governance.
Speak to the DRS International team today to understand your readiness gaps and start building a clear plan for DRS implementation.