The 5 Biggest Challenges for Implementing Procurement Sustainability Strategies in CPG Companies in Mexico’s Circular Economy

As we continue to shift toward sustainability, CPG companies in Mexico face unique challenges in adopting procurement strategies that align with a circular economy. While the benefits are clear—cost savings, improved brand image, and reduced environmental impact—implementation remains complex. Based on my experience leading supply chain transformations, here are the five biggest challenges and how we can overcome them:

1. Insufficient Recycling and Waste Management Infrastructure

Mexico's recycling and waste management infrastructure is underdeveloped, particularly outside major cities. For companies looking to close the loop on packaging or integrate recycled materials, this poses a major obstacle. Without robust systems in place, even the most well-intentioned sustainability efforts can falter.

What’s the solution? CPG companies need to form partnerships with local governments, startups, and private organizations to build infrastructure or find innovative recycling solutions. Collaboration will be key to long-term success.

2. Supplier Development and Alignment

Many of Mexico’s suppliers, especially small and medium enterprises (SMEs), are not yet equipped to meet the stringent sustainability standards that a circular economy demands. This misalignment creates challenges in securing eco-friendly materials or ensuring ethical sourcing practices.

How do we address this? Large CPG companies must support their suppliers by providing training, resources, and financial incentives to help them evolve toward sustainable practices. Investing in these partnerships will create a more resilient and aligned supply chain.

3. Cost Pressures and ROI Justification

Sustainability is often seen as an expensive endeavor, with initial costs for eco-friendly materials and processes being higher than traditional options. Convincing stakeholders to prioritize long-term gains over short-term cost savings can be difficult, especially in competitive markets where price is a key driver.

My perspective: We need to shift the conversation to the long-term benefits. Reduced waste, enhanced consumer loyalty, and compliance with future regulations will lead to significant cost savings and better ROI in the future. Let’s position sustainability as a value generator, not just a cost center.

4. Regulatory and Policy Gaps

Inconsistent or unclear regulations in Mexico around sustainability, waste management, and circular economy practices make it difficult for CPG companies to implement cohesive strategies. Without clear federal guidance on recycling mandates or extended producer responsibility (EPR), it’s hard to set a long-term path.

What’s next? We must proactively engage with policymakers to push for regulations that align with our sustainability goals. As leaders in supply chain, we have a responsibility to advocate for changes that benefit both the environment and our industry.

5. Consumer Education and Behavior Change

The success of a circular economy depends on more than just corporate initiatives—it requires active participation from consumers. In Mexico, consumer awareness about sustainability varies, and without proper education, even the best circular strategies can fall short.

How can we change this? As CPG companies, we should invest in consumer education campaigns to drive behavior change. From educating consumers on recycling to incentivizing sustainable purchases, we must foster a responsible consumption culture.

Final Thoughts Implementing sustainability strategies within Mexico’s circular economy is challenging, but not impossible. By addressing infrastructure gaps, building stronger supplier partnerships, focusing on long-term ROI, advocating for clearer regulations, and educating consumers, we can lead the charge toward a more sustainable future. It’s time for CPG companies in Mexico to not only adapt but to thrive in the circular economy.

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