Closing the Loop on California’s Small-Format Plastics

The Smalls Consortium, led by Closed Loop Partners’ Center for the Circular Economy, is partnering with industry heavyweights including L'Oréal, Kraft Heinz, and CVS Health. By collaborating with Potential Industries, a veteran recycling operator in Southern California, the group intends to test infrastructure adjustments and market demand strategies. This effort is specifically timed to align with California’s SB 54 law, which mandates new producer responsibility standards starting January 1, 2027.

For major brands, the stakes are both environmental and operational. Marissa McGowan of L'Oréal describes the project as a business imperative to secure future material supply and mitigate supply chain risks. Unlike previous efforts, the program focuses on the full value chain—linking sorting improvements at the facility level with the creation of stable end markets that can actually utilize the recovered plastics.

This initiative serves as a practical proving ground for the Circular Action Alliance, which is currently developing EPR program plans for several states. By collecting data-driven evidence in real-world conditions, the Consortium hopes to move beyond theoretical models. The project builds on four years of research, including pilot studies in New York, and now aims to establish a template for small-format recovery that can be exported to other regions facing similar regulatory shifts.