From 1 October 2027, retailers across England, Scotland and Northern Ireland selling drinks in single-use plastic bottles or metal cans will need a way to take those containers back. This guide explains what retailers of any size need to know to help you prepare for the Deposit Return Scheme. It covers what DRS is, the timeline between now and launch, what's expected of retailers, the two ways to run a return point, the latest position on exemptions, and how First Mile can help you prepare.

What is the Deposit Return Scheme?

From October 2027, a small deposit will be added to the price of every eligible drink sold in a single-use container. Customers pay this deposit when they buy the drink and get it back in full when they return the empty bottle or can to any registered collection point.

in-scope deposit return scheme containers

The system applies to plastic bottles and aluminium cans ranging from 150ml up to 3 litres. By giving containers a clear financial value, the government hopes to stop them ending up in landfill or as street litter.

What retailers need to do now

  • Check if your shop floor space means you must operate a return point.
  • Speak to your till provider to make sure your system can add and track the 20p deposit.
  • Decide if you will collect empty bottles manually or use an automated reverse vending machine.
  • Read the exemptions criteria to see if your store qualifies to opt out.

Which retailers must operate a return point?

Required to opt-in: Grocery Retailers

Grocery retailers that sell in-scope drinks to the public for consumption off the premises are required to host a return point open to the public, unless they qualify for an exemption. This includes supermarkets of any size, grocery stores, convenience stores, and newsagents that sell drinks.

Not required to opt-in: Hospitality & food-to-go

Hospitality businesses and food-to-go retailers such as Pret, Joe & The Juice and Itsu, where in-scope drinks are sold, are not obligated to act as return points. However, both the system administrator and Government explicitly allow these types of businesses to opt into the Deposit Return Scheme.

Not required to opt-in: Online Retailers

Online retailers (including online only grocery retailers) have no mandatory obligation to operate a return point, though they can choose to register as a takeback service provider. Vending machine operators don't have to provide a return point either, but do have to display signage pointing customers to their nearest one.

Return point exemptions

The exemptions process is designed to protect businesses that physically cannot manage a return point. Only urban stores under 100m², are automatically exempt.

Your site Likely position
Urban store <100m² Automatically exempt
Urban store 100–199m² May qualify for exemption
Rural store <200m² May qualify for exemption
Larger retailer Likely needs a return point
Hospitality / food-to-go No mandatory public return point
Online-only No mandatory return point

 

The three main reasons you might be exempt are:

Store size: Urban shops with a floor space between 100m² and 199m² can apply for a size-based exemption. Rural shops under 200m² can also apply.
Proximity: You can apply for an exemption if your shop is located very close to another official return point that has agreed to accept containers on your behalf.
Safety and layout: If the physical design of your shop makes it dangerous or completely impractical to store returned bottles, you may qualify for an exemption.

Your return point duties

If you're operating a return point, your duties include:

✓ Only selling in-scope drinks from producers registered with Exchange for Change
✓ Making sure everything you sell carries the correct scheme return code and DRS logo
✓ Charging the deposit on every in-scope container sold
✓ Accepting every in-scope container a customer brings back, regardless of where they bought it
✓ Refunding the deposit at the point of return
✓ Storing returned containers safely until they're collected
✓ Displaying clear information about how the scheme works, and how customers can raise a complaint or contact Exchange for Change
Retailer deposit return scheme checklist

Who needs to register with Exchange for Change

Exchange for Change is the official operator of the Deposit Return Scheme and some businesses need to register with them.

  • Grocery retailers: All but those who are automatically exempt

  • Producers and importers: Manufacturers and importers of drinks must register

  • Hospitality & food-to-go: No need to register at present

DRS Timeline

  • June 2026

    Key confirmations: Return Handling Fee, £60m grant scheme and exemptions framework.

  • H2 2026

    Registration opens for producers and retailers. Exact date not yet confirmed.

  • 9 July 2027

    Producer product-registration deadline. Producers must register all existing in-scope products with Exchange for Change 12 weeks before launch. Retailer registration will follow once Exchange for Change confirms the onboarding timetable.

  • 1 October 2027

    DRS goes live in England, Scotland and Northern Ireland.

  • October 2031

    Wales only: Glass transition period ends and reuse target begins.

Manual and automated return points

There are two ways to operate a return point:

  • Manually, where a member of staff accepts the container over the counter and refunds the deposit, or

  • Automatically, using a reverse vending machine that the customer operates themselves.

Both count as valid return points under the scheme, and both attract a handling fee, just at different rates (more on that below).

Return type Manual Returns Reverse Vending Machine
How it works Staff take the empty containers by hand and refund the deposit via the till. Customers feed containers into a machine which issues a refund voucher.
Best suited for Smaller shops with lower footfall and limited floor space. Larger stores expecting a high volume of returns.
Staff time Requires staff interaction for every single return. Fully automated, freeing up staff for other tasks.
Storage Containers must be safely stored in the back room by staff. The machine crushes and stores the containers internally.

Does an RVM pay for itself?

ACS has publicly said its modelling suggests RVM fixed costs can exceed £10,000 per year and estimated roughly 4,000 containers/week (208,000 per year) would be needed to break even under its assumptions. Below is a simple illistrutive calculation to show what would be covered by the handling fee.

50 returns/day = 18,250 returns per year. RHF at 5p = £913/year.

250 returns/day = 91,250 returns per year. RHF at 5p = £4,563/year.

600 returns/day = 219,000 returns per year. RHF at 5p = £10,950/year.

 

First Mile offers a free DRS consultancy to help you prepare for the scheme. We also have a range of reverse vending machines available for purchase or lease.

The return handling fee

If you operate a return point you are entitled to a Return Handling Fee (RHF). This is a payment to you designed to cover the cost of equipment, staff training, and the value of the floor space or storage area you use to collect and hold containers.

The rates are:

Manual return points 3p per container
Automatic return points, Tier 1 5p per container, for up to 225,000 in-scope items returned annually
Automatic return points, Tier 2 1.3p per container, for annual returns above 225,000

Small retailer grant scheme

A £60m grant fund has been set aside by Exchange for Change to help up to 10,000 small, independent retailers meet installation and maintenance costs of installing reverse vending machines.

Grants of £6,000 will be made available per site to qualifying retailers, paid in three £2,000 annual payments. The first payment will be issued three months after the installation of an RVM.

Container collections

Exchange for Change will arrange the physical transport from return points to counting and sorting centres, utilising contracted logistics and recycling infrastructure. Full details are not currently available.

Other considerations

Before deciding how to approach DRS, most retailers will need to think about:

⭐ How much floor space or back-of-house storage you realistically have
⭐ Check your till provider to make sure your system can add and track the 20p deposit
⭐ How you'll store returned containers hygienically and securely before collection
⭐ Store and staff hygiene. With a risk of liquid spillages at both manual and automatic return points, staff need to be alert to avert slip risks. Containers may also be dirty, so having adequate hand washing facilities is important.
⭐ Staff time, particularly at busy periods, if you're going the manual route

Issuing, refunding and balancing deposits and refunds

The 20p deposit needs to be applied to any in-scope drink at the point it's sold to a consumer. It must also be refunded to them at any return point.

Hospitality and foodservice, on-premise versus off-premise

Chains like Pret, Itsu and Joe & The Juice can sell in-scope containers for takeaway or for consumption on the premises.

If a drink is sold for consumption off the premises, the deposit must be charged. The customer pays it at the till like any other sale, and can reclaim it at any registered return point once they're finished with the container.

Where a drink is sold to consume in your venue, you can choose whether to pass the deposit on to the customer or not. The deposit has already been paid to your supplier, so you’ll need to get the refund back yourself through a return point.

In Scotland, where it's clear a beverage will be drunk on-site, the deposit shouldn't be charged at all.

EPOS system commuicating DRS data

How your till ties into the scheme

Check with your till provider now to make sure your system can handle the scheme.

You will need your checkout system to automatically add the 20p deposit to the price of eligible drinks at the point of sale. It must also accurately track the deposits you refund to customers to balance the money taken in deposits against the money paid out in refunds.

Get a free DRS consultation with First Mile

Getting ready for DRS looks different depending on the size and layout of your business. First Mile works with retailers of every size to figure out the right approach for each site, from single independent shops to national multi-site chains.

We’re offering free DRS consultations to both customers and non-customers to help you prepare for the scheme. This includes:

✓ Helping you understand what DRS actually means for your business, in plain terms
✓ Assessing the requirements of individual sites, including whether a site is likely to qualify for an exemption
✓ Helping you decide between a manual return point and an RVM, based on space, footfall and expected volumes
✓ Supporting manual return point implementation, from storage layout to process design
✓ Practical help with storage, layout and day to day processes ahead of launch

We also supply reverse vending machines, built to suit retailers of any size, which are available to purchase or lease.

For qualifying small independent retailers, First Mile factors the £6,000 Exchange for Change grant into its buy and lease pricing for RVMs, rather than leaving you to wait on the staged payments Exchange for Change pays out over three years.

Claim your free DRS consultancy >

Summary

What to think about now

Work out roughly which category your site falls into, automatically exempt, likely to need to apply for an exemption, or clearly required to operate a return point. Start weighing up a manual versus automatic process based on your space and expected volumes. First Mile can help you assess your sites and put the right solution in place.

It is also an opportunity to see increased footfall, so it is worth considering looking into impulse purchase options around your return point to maximise transaction potential.

What to think about when registration opens

Once Exchange for Change opens registration and publishes the exemption application process, you'll need to register, unless you are automatically exempt. Get your chosen return point installed and tested, and get staff trained on the process, all before October 2027.

Preparing your retail business for DRS?

Talk to First Mile about the right return solution for your business, whether that's a manual return point, a reverse vending machine, or help understanding whether you might qualify for an exemption.

Get a free DRS consultation

Retailer DRS FAQs

How does a manual DRS return point actually work?

A member of staff accepts the empty container from a customer, checks it's part of the scheme (usually by scanning a barcode or checking the scheme logo), and refunds the deposit through the till. The container is then stored on site until it's collected. No machine is required, though you still need suitable storage space.

Do I have to install a reverse vending machine, or can I run a manual return point instead?

Either is a valid way to comply with DRS if you're required to operate a return point. Manual return points suit lower volumes and lower upfront cost, while an RVM takes day-to-day handling off your staff but comes with a bigger initial investment and space requirement. Which one makes sense depends on your site and expected footfall.

What is the Return Handling Fee and how much will I be paid?

It's the fee Exchange for Change pays retailers for operating a return point, intended to cover equipment, staff training and the use of your floor space. As confirmed in June 2026, manual return points are paid 3p per container. Automatic return points are paid 5p per container for up to 225,000 returns a year, dropping to 1.3p per container above that.

Is my shop automatically exempt from operating a return point?

If you're in an urban area and your retail space is under 100m², yes, you're automatically exempt and don't need to register unless you want to operate a return point voluntarily. Larger shops, and all rural shops regardless of size, need to either operate a return point or apply for one of the other exemption categories.

Can I apply for an exemption if my shop is between 100m² and 200m²?

Yes, in principle. Urban retailers with a retail space between 100m² and 199m², and rural retailers under 200m², can apply for a size-based exemption. It isn't automatic, and there's a presumption against granting exemptions to shops of 200m² or more. The full application and exemption process hasn't been published yet.

Is there financial help available for small retailers who need to install an RVM?

Exchange for Change has confirmed a £60m grant fund aimed at up to 10,000 small, independent retailers, offering £6,000 per site paid over three years. Detailed eligibility criteria are still to be published, expected in Q3 2026.

Who is running the scheme?

The scheme is run by Exchange for Change, the trading name of the UK Deposit Management Organisation (UK DMO), a not-for-profit body appointed to deliver DRS across England, Scotland and Northern Ireland. Wales is running its own, separate scheme with different rules and its own scheme administrator. Its legislation includes glass, but glass will carry a zero deposit during a transition period running to October 2031, meaning the October 2027 experience for consumers and businesses will be closely aligned with the rest of the UK at launch.

Why is DRS being introduced?

It's being introduced to cut litter and lift recycling rates. The scheme's own documentation sets out a target of returning 90% of all in-scope containers placed on the market by 2030, which is only achievable with a genuinely accessible, well distributed network of return points.

Talk to an expert

Sources: