The question

For a retailer facing a Deposit Return Scheme (DRS), the key financial question is simple but crucial:

“Will the handling fee we receive per returned container, together with any related income, be enough to cover the cost of buying, installing and running Reverse Vending Machines – or are we signing up for a permanent cost drag?”

A critical clarification: the £0.03 figure is only an assumption

As of January 2025, the UK Deposit Management Organisation (UK DMO) – the business‑led, not‑for‑profit operator of the upcoming DRS for England, Northern Ireland and Scotland – has not yet published the final handling fee levels that retailers will receive per in‑scope container.

That means any per‑container fee you see in models today (including £0.03 per container) is speculative and should be treated as a working placeholder, not a committed tariff.

For more detail on the UK DMO and its role, see:
https://dmouk.com/

Using a notional 3p handling fee per container is still useful for modelling, but procurement and investment decisions should be built around scenarios, not a single assumed value.

What the handling fee is supposed to pay for

In theory, the handling fee is designed to cover the non‑recoverable costs of operating return points, which can include:

• Labour for handling containers (manual or via RVM support tasks).
• Floor space and back‑room space used for RVMs and bag storage.
• Consumables (bags, paper, cleaning materials).
• Energy consumption of the RVMs.
• Maintenance and servicing.
• A reasonable contribution to capital costs over time.

Industry guidance and commentary on DRS emphasise that retailers should be compensated for their role in hosting return points and handling returned containers.

However, in practice:

• The exact fee level and its indexation over time will determine whether it fully, partially or only marginally covers your cost base.
• The volume per machine is just as important as the fee: a low fee on very high volumes may still be attractive; a higher fee on very low volumes may not be.

The RVM cost picture: what you are really paying for

From a 5–7 year perspective, the full cost of a DRS‑grade RVM estate comprises:

1. Capital and rollout

• The machine itself – sensors, mechanics, scanners, compactor, computer, payment and security components.
• Delivery, mechanical fixing and commissioning.
• Enabling works: power, network connections, any floor or wall works.
• Optional shelters or kiosks if installed outside.

RVMs are fundamentally industrial equipment with a lot of technology built in; low sticker prices that cut into robustness tend to show up later as uptime and maintenance problems.

2. Store‑level operations

• Staff effort to:

  • Change printer paper rolls.
  • Swap full bags and move them to the backroom.
  • Hand bags to collection vehicles.
  • Perform quick daily cleaning and periodic deeper checks.

• Consumables (bags, paper, basic cleaning kit).

• Front‑of‑house and back‑room space.

3. Maintenance and service

• An annual or multi‑year maintenance contract:
  • Preventive maintenance visits.
  • Reactive call‑outs under agreed SLAs (for example 4‑hour, 12‑hour, 1–2 days).

4. IT and data integration

• Initial setup of:

  • POS and voucher APIs.
  • Loyalty/API connections (if used).
  • Fleet portal integration into monitoring and reporting tools.

• Ongoing IT operations and monitoring.

Any realistic model must include all four blocks, not just “machine price ÷ X years”.

How handling fees and other income offset those costs

With an illustrative handling fee at, say, £0.03 per container, you can think in terms of:

• Handling fee income = returns volume × fee per container

For example:

• 500 containers/day × 30 days × £0.03 ≈ £450/month.
• 1,000 containers/day × 30 days × £0.03 ≈ £900/month.

To this, you can add two important, often overlooked income lines:

Media revenue from the RVM screen

An RVM with a proper media screen is a high‑engagement digital surface:

• Customers stand in front of it for 10–60 seconds.
• Often there is a short queue, all facing the screen.
• The context is positive: recycling, getting money back, sustainability.

Sold correctly to suppliers and partners, this can become a meaningful monthly revenue line per RVM, particularly if you operate hundreds of units.

Recyclever deliberately integrates a media screen into its RVM design so that:

• You have a ready‑to‑sell media asset across the estate from day one.
• It is straightforward to run brand campaigns, DRS education and your own promotions on the same hardware.

Promotion and loyalty‑linked value

By integrating RVMs into your loyalty app and voucher system, you also open the door to:

• Supplier‑funded targeted offers (for example funded discounts on specific categories or packs).
• Increased store visit frequency as customers come back to redeem deposits and promotions.
• Marginal increases in basket value when voucher redemptions are tied to broader baskets.

Those benefits are harder to express as a neat “£/container” figure but should still be recognised in the business case.

Why Recyclever’s cost base matters in this equation

The less you need to spend per machine and per year to achieve reliable DRS‑compliant performance, the easier it becomes for handling fees and media to cover your costs.

Two points are particularly important:

1. Manufactured in the UK

   • Recyclever builds its machines in the UK, with short supply chains and local engineering capability.
   • This helps keep build and logistics costs competitive, simplifies support, and reduces exposure to currency swings and long‑distance freight.

2. Technology where it pays back

   • The machines are engineered to be robust and DRS‑ready (barcode/database mode, computer vision, anti‑fraud, etc.), not stripped‑down devices that will fail in real retail environments.
   • At the same time, they avoid unnecessary complexity or “gimmicks” that inflate capex without contributing to uptime, compliance or revenue.

That combination—competitive build cost plus winning technology targeted at what actually matters—makes it more realistic for handling fees and incremental revenue to cover a high proportion of lifecycle cost.

Installing inside the shop: cost and risk advantages

Wherever physically possible, installing RVMs inside the store remains the recommended approach:

• Lower deployment cost: fewer civil works, no separate shelters, simpler permissions.
• Higher reliability: no direct exposure to rain, snow, wind, vandalism hotspots or temperature extremes.
• Better customer experience: warmer, safer, more visible return points.

All of this reduces:

• The frequency and severity of technical issues.
• The need for emergency call‑outs.
• The risk of extended downtime and lost handling‑fee income.

In short: indoor placement is not only better for customers; it directly supports the financial viability of the RVM.

Putting it together: will handling fees “fully cover” RVM costs?

Given that UK handling fees are not yet set, you cannot honestly claim “DRS will pay for everything” today. What you can say, with a disciplined model, is:

• At realistic container volumes per machine, even a modest fee per container can go a long way toward covering:

  • Operational labour and consumables.
  • Maintenance contracts.
  • A good share of capex over 5–7 years.

• If you actively monetise the RVM’s media screen and embed RVMs into your:

  • Loyalty journeys,
  • Promotion mechanics, and
  • Supplier‑funded campaigns,

  you can create additional revenue streams that push the overall economics firmly into positive territory.

• Choosing a supplier like Recyclever, with UK manufacturing, competitive cost base, strong anti‑fraud technology and an integrated media screen, materially improves the odds that:

  • Handling fees + media + promotional value will not only cover the lifecycle cost of the RVM estate, but
  • Turn your return‑point infrastructure into a net contributor rather than a bare compliance obligation.

The right way forward is therefore scenario‑based planning:

• Model multiple fee levels (for example £0.02, £0.03, £0.04 per container).
• Model low, medium and high volume assumptions by store type.
• Layer in conservative media revenue and realistic operational costs.

Then test: under how many of those combinations does the RVM estate break even or show a positive contribution?

With prudent assumptions and the right technical and commercial choices, you can move from “Do we have to do this?” to “How much value can we extract while we do what we have to do anyway?”.

Read how to generate revenue from RVMs: https://www.recyclever.com/blog/articles-10/how-can-we-convert-rvms-from-a-pure-drs-compliance-cost-into-a-revenue-and-loyalty-driver-for-our-estate-549