DOI: 10.3303/CET25121015
Paper Received: 19 August 2025; Revised: 2 November 2025; Accepted: 11 December 2025
Please cite this article as: Aliyamone S., Almelhem M., 2025, Investigating the Operational Efficiency for the Small Asian Retailer Stores under
the Deposit Refund System: Hungary Case Study, Chemical Engineering Transactions, 121, 85-90 DOI:10.3303/CET25121015
CHEMICAL ENGINEERING TRANSACTIONS
VOL. 121, 2025
A publication of
The Italian Association
of Chemical Engineering
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Copyright © 2025, AIDIC Servizi S.r.l.
ISBN 979-12-81206-22-9; ISSN 2283-9216
Investigating the Operational Efficiency for the Small Asian
Retailer Stores under the Deposit Refund System: Hungary
Case Study
Sipaseuth Aliyamone, Marah Almelhem*
Kautz Gyula Faculty of Economics, Széchenyi István University, Egyetem tér 1, 9026 Győr, Hungary
almelhem.marah.samir.nayif@sze.hu
Waste management is crucial to achieving global sustainability goals, with the Deposit Refund System (DRS)
emerging under the Extended Producer Responsibility (EPR) framework to enhance recycling rates by
incentivising consumers to return beverage containers through refundable deposits. In Hungary, large retailers
are required to participate in DRS, while small retailers may join voluntarily. This research aims to identify key
factors influencing the voluntary participation of small Asian retail stores, focusing on economic, operational,
regulatory, and social aspects. Using semi-structured interviews with ten stores in Budapest and Győr, a
thematic analysis identified both motivators and barriers to participation. Findings indicate environmental
awareness among participants, but low operational capacity, with space constraints, labour demands, and
unclear regulations limiting engagement. Financial concerns, particularly equipment and handling costs, were
major deterrents, while the potential for increased customer traffic was seen as a benefit. The study highlights
the need for targeted financial incentives, infrastructure support, and clear policy communication to increase the
inclusion of small retailers in DRS frameworks.
1. Introduction
Waste management has become a critical global issue due to the rapid growth of urbanisation, population
growth, and unsustainable consumption, particularly from packaging and single-use plastics. In the European
Union (EU), over 2.2 Gt of waste is produced annually (European Parliament, 2023), prompting a circular
economy strategy focused on resource efficiency and waste reduction (Mertens, 2023). Beverage packaging
has a value if properly collected and recycled, holds value through bottle-to-bottle reuse into new containers,
reducing environmental harm, and conserving raw materials (Zhou et al., 2020). Many countries have adopted
economic instruments under the EPR framework, notably the DRS, which shifts the responsibility for waste
management from the municipalities to producers. The DRS incentivises consumers to return beverage
containers for a refund, improving material quality and recycling rates (Gupt and Sahay, 2015). This is
particularly evident in Germany and Denmark, where return rates exceed 90 % (Rossi et al., 2022; Zhou et al.,
2020). Hungary introduced DRS in January 2024 for plastic, glass, and metal beverage containers. However,
the operational approach and stakeholder engagement vary between countries, creating knowledge gaps,
particularly concerning small retailers (Krzywda, 2022). While large retailers that have an area of >400 m² in
Hungary are mandatory to participate, the small retailers that have an area of <400 m² can opt in voluntarily.
The voluntary participation of small retailers, opposed to the mandatory compliance of larger businesses, is
effectively analysed through Resource Constraint Theory (RCT). This theoretical framework suggests that the
strategic and operational capacity of small and medium-sized enterprises (SMEs) is fundamentally constrained
by significant limitations in financial capital, physical space, and human labour (Aggelopoulos et al., 2023). For
small Asian retailers operating with minimal margins, the decision to adopt the DRS constitutes a complex risk
assessment, where the perceived operational burden is significantly increased by their limited resources. Their
participation is primarily influenced by an assessment of viability, balancing the system's requirements with their
ability to accommodate them without affecting essential business functions. This study explores the perspectives
of small Asian retailers in Hungary regarding voluntary participation in DRS, focusing on their willingness, ability,
and influencing factors to participate. It addresses the following questions: (i) What factors influence the
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willingness of Asian retailers in Hungary to participate voluntarily in the DRS? (ii) How does DRS implementation
affect the operational efficiency of Asian retailers in Hungary? (iii) How does the DRS integration affect the
retailers’ relationship with the supplier and producer?
2. Waste Collection System
The waste collection systems are a critical component of sustainable waste management, facilitating the transfer
of solid waste from points of generation to treatment or disposal facilities (Andales, 2025; Mwanza et al., 2018).
The food and beverage sector is a major source of packaging waste, accounting for nearly 40 % of plastic in
the EU (European Commission, 2025). Traditional municipal waste systems rely on centralised infrastructure
and direct collection from households or designated points (Hidalgo et al., 2018). In a historic urban area with
narrow streets and limited space to access for collection, relying on outdated disposal methods in landfilling has
caused significant environmental harm (Conure, 2022). In the EU, only 36 % of the 2.2 Gt of waste generated
annually is recycled, with an estimated 600 Mt of recyclable materials each year. Modern curbside collection
has improved recovery efficiency but remains costly and complex (European Parliament, 2023; Rossi et al.,
2022). Improving these inefficiencies requires integrated, technology-driven strategies supported by policy
instruments such as Extended Producer Responsibility (EPR) and Deposit Refund Systems (DRS), which can
enhance collection rates, improve material recovery, and support circular economy objectives.
3. The Extended Producer Responsibilities Framework
Extended Producer Responsibilities as an environmental policy framework, shifting the responsibility for post-
consumer product management from municipalities to producers (Johannes et al., 2021). This approach
encourages sustainable product design, reduced resource use, and increased recycling (Winternitz et al., 2019).
EPR schemes can be mandatory or voluntary, imposing physical, financial, or information obligations on
producers, using a combination of regulatory and market-based tools such as take-back mandates and a deposit
return system (Watkins et al., 2017). Packaging waste, particularly plastic, constitutes over one-third of the
global plastic production, which is a major focus. A recycling rate that remains low can be seen in Figure 1
(Eurostat, 2024; Watkins et al., 2020).
Figure 1: Plastic packaging waste generated and recycled in the EU 2012-2022
Around 80 % of a product’s environmental impact is determined during the design stage (European Commission,
2025). EPR incentivises eco-design, material reduction, and reuse. Producer-led DRS exemplifies EPR by
motivating consumers to return packaging, reducing waste, and advancing circular economy goals
(Manomaivibool and Hong, 2014).
4. Deposit Refund System
The Deposit Refund System, a core EPR instrument, incentivises consumers to pay a small deposit when
purchasing beverages, refunded upon returning the empty container to designated collection points (Laubinger
et al., 2022; Walls, 2012). This model reduces litter, supports high-quality recyclable material for closed-loop
recycling, reducing the resources required for virgin material needs and associated environmental impacts
(Picuno et al., 2025). Globally, DRS models vary by social, economic, cultural, and regulatory conditions
(Krzywda, 2022). Effective systems maintain low contamination rates and integrate multiple material streams,
such as PET, HDPE, aluminium, and glass, collecting them through manual systems or reverse vending
machine (RVM) methods (GS1, 2024; Sensoneo, 2025). By 2024, 14 European countries had implemented
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national schemes, serving approximately 164 million people, with return rates in some nations exceeding 90 %
(Sensoneo, 2024). The EU’s 2024 Packaging and Packaging Waste Regulation (PPWR) mandates all member
states to achieve 90 % collection rates for plastic bottles and cans by 2029 (EUROPA, 2024). Hungary launched
its nationwide DRS in January 2024, covering PET, glass, and metal containers with capacities between 0.1
and 3 L. A fixed deposit of 50 HUF is charged at purchase and refunded at the approved collection point
(Repont|Mohu, 2025). Large retailers (>400 m²) are required to install RVMs, while smaller stores can participate
voluntarily, with those (<400 m²) eligible for exemption. The Hungarian system is operated by MOHU, managing
container registration, labelling compliance, and logistics. Producers must register products in a national
database, meet labelling standards, pay for service, and pay exchange fees to support the system’s operation.
Retailers must handle returns manually or via RVMs, maintain hygiene standards, and report the standards
(Repont|Mohu, 2025).
5. Producer and retailer behaviour under DRS
Under the EPR framework, producers are legally responsible for products and packaging end-of-life, including
post-consumer waste, to design and label (GS1, 2024; Ramasubramanian et al., 2024). In DRS, this requires
product registration, compliance labelling, and payment service, connection, and exchange fees to finance
system operations (Repont|Mohu, 2025). Although DRS inherently incentivises producers toward eco-friendly
materials and enhanced recyclability, they often delegate operational responsibilities to retailers to minimise
costs, and effective producer-retailer collaboration is essential for efficiency, such as product registration, data
synchronisation, and logistics support (Özdemir-Akyildirim, 2015; Laubinger, 2022). Retailers serve as collection
points, responsible for refunding deposits to consumers in exchange for returned beverage containers (Picuno
et al., 2025). Retailers handle empty packaging by collecting, storing, shipping, and reselling it to the operators.
Following the figure 2 shown the circulation of packaging and deposits: (1) Consumers paying a standardized
50 HUF container deposit at purchase and refunded it upon return; (2) Retailers transfer collected containers to
the system operator (MOHU) and are reimbursed for the refunded deposits; (3) Suppliers distribute products to
retailers, who purchase them along with the pre-paid deposit liability, and (4) Suppliers register with MOHU,
financing the system through participation and per-unit deposit fees (GS1, 2024). DRS participation is typically
mandatory for large stores but voluntary for small retailers, as in Hungary, where those under 400 m² can apply
for exemptions (Repont|Mohu, 2025). The collection methods include both manual and automated RVMs, with
each presenting distinct cost, labour, and space implications. Manual collection involves staff scanning
barcodes; RVMs automate the process itself (Mertens, 2023).
Figure 2: Circulation of packaging and deposit fee flow in Hungary
6. Methodology
This study adopted an exploratory qualitative design to investigate the perceptions, willingness, and operational
realities of small Asian retailers in Hungary regarding participation in the newly introduced DRS. A qualitative
approach was selected to capture context-specific experiences that quantitative methods might overlook (Suter,
2019). Purposive sampling identifies the selection of participants with direct relevance to the research objectives
(Vasileiou et al., 2024). The final sample included ten small Asian-owned retail stores from two in Győr and eight
in Budapest, each under 400 m², qualifying for exemption from mandatory DRS participation under Hungarian
regulations (Repont|Mohu, 2025). Semi-structured, in-depth interviews were conducted with store owners to
explore factors identified in prior literature as influencing retailer participation: economic considerations,
operational constraints, supplier relationships, social influences, and regulatory understanding (Picuno et al.,
2025; Zhou et al., 2020). Interviews, lasting 30 to 40 min, were audio-recorded with consent and supplemented
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by field notes detailing store layout and space availability. Interviews were conducted in English or Lao (with
researcher translation). Translation from Lao to English was carried out by the researcher, ensuring semantic
accuracy and contextual consistency. Thematic analysis, following Hennink and Kaiser (2022), was used to
organise findings into five themes: economic factors, operational efficiency, supplier relations, social influences,
and regulatory understanding, with QDA software enhancing coding consistency and traceability, ensuring that
findings were systematically linked to participant responses.
7. Results and Discussion
7.1 Awareness and Understanding of DRS
Table 1 shows that all retailers had some knowledge of the DRS, mainly from suppliers, informal networks, or
observing the implementation in large supermarkets. However, nine out of ten retailers demonstrated a partial
understanding of procedures such as container registration, exemption eligibility, or refund mechanisms. The
lack of multilingual training materials and official guidance contributed to uncertainty. This reflects broader
research suggesting that inadequate communication reduces small business engagement and hinders their
participation in environmental policy initiatives (Zhou et al., 2020). Also, refer to an agreement with the DRS
system that will help with environmental sustainability, acknowledging its potential benefits for waste reduction
and recycling, it had been mentioned 11 times.
Table 1: Retailer awareness and understanding of DRS
Code Freq. Count % Code Case
Limit Knowledge 9 3.80 % 9
System Concern 5 2.10 % 5
System Agreement 11 4.60 % 9
Method_Machine 8 3.40 % 8
Method_Manual 2 0.80 % 2
7.2 Economic Considerations
Financial concerns were the strongest barrier to participation. Most retailers emphasised the costs of labour,
storage, and equipment, particularly RVMs, which were considered unaffordable for small stores. Handling fees
were seen as necessary but insufficient to cover the full cost of participation. While some acknowledged potential
indirect benefits from attracting environmentally conscious customers, these were outweighed by concerns
about profit margins. These findings are consistent with previous studies showing that the cost–benefit
perceptions strongly influence retailer participation in DRS systems (Laubinger, 2022; Picuno et al., 2025).
7.3 Operational Efficiency
Operational challenges were highlighted by almost all participants. Limited space in a small shop under 400 m²
was cited as a critical issue for both manual storage and RVM installation. Hygiene risks from handling returned
containers were also frequently mentioned. Manual collection was described as disruptive to normal business
operations, especially during peak customer hours when staff have to collect one by one, which consumes time.
These concerns mirror those identified in earlier studies, which note that small stores face disproportionate
logistical burdens when implementing collection systems (Aggelopoulos et al., 2023).
7.4 Supplier Relations
Suppliers provided DRS-compliant labelling but offered little logistical or procedural support. Retailers were often
uncertain about barcode registration and product compliance. This lack of producer–retailer coordination
undermines system efficiency, echoing prior research showing that effective collaboration across the supply
chain is essential for smooth DRS functioning (Özdemir-Akyildirim, 2015).
7.5 Social Influences
Consumer environmental awareness is increasing, and some retailers noted customer interest in local return
points. However, stores located near large supermarkets experienced little customer demand for their
participation, as consumers were expected to return containers to the larger, well-equipped retailers. This
suggests that consumer-driven pressure is uneven and context-specific, with findings on geographic disparities
in participation (Krzywda, 2022).
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7.6 Regulatory Understanding
A lack of regulatory clarity was a recurring concern. Participants highlighted inconsistent communication, unclear
exemption procedures, and limited support tailored to small businesses. Many perceived inequity between small
and large retailers, with many retailers arguing that large chains are better positioned to absorb the financial
and operational burdens of participation than the smaller. It noted that unclear or uneven regulations undermine
stakeholder trust and reduce voluntary engagement in waste management systems (Winternitz et al., 2019).
7.7 Willingness to participate
As shown in Table 2, 70 % of the participants stated they would not voluntarily join the DRS under current
conditions, citing cost, space, and lack of guidance. However, 30 % expressed conditional willingness if
adequate incentives, infrastructure, or financial support were provided. This conditionality suggests that
participation is not rejected outright but depends on policy adjustments that address specific constraints faced
by small retailers.
Table 2: Willingness to participate
Code Freq. Count % Code Case
Voluntary_yes 3 1.30 % 3
Voluntary_no 9 3.80 % 7
Condition for participation 18 7.60 % 10
8. Conclusions
This study shows that small Asian retailers in Hungary face significant barriers to participating in the DRS. While
they recognise its environmental value, economic costs, operational constraints, limited supplier support, and
unclear regulations reduce their willingness to engage. Only a minority expressed conditional willingness,
contingent on financial and infrastructural support. The findings indicate that voluntary participation depends
less on environmental attitudes and more on economic viability, logistical feasibility, and regulatory clarity. To
achieve inclusive and effective outcomes, Hungary’s DRS must adopt targeted measures—such as scalable
handling fees, subsidies, multilingual training, and stronger producer–retailer coordination—to support small
retailers and meet EU collection targets.
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COS25_0082.pdf
Investigating the Operational Efficiency for the Small Asian Retailer Stores under the Deposit Refund System: Hungary Case Study