How Indian SMBs Can Make Their Shipping Eco-friendlier Without Spending More

Shipping costs have two components. The base rate — weight, distance, carrier — is largely fixed. What is not fixed is how much of it goes to waste: through oversized boxes that inflate volumetric weight charges, unnecessary padding, plastic mailers that create compliance liability and failed deliveries that mean every resource spent on that shipment is spent twice.
A failed delivery does not just cost money — it doubles the environmental cost of that shipment. For many Indian SMBs, reducing RTO rates may be the most impactful way to cut both logistics waste and avoidable costs.
This guide covers four decisions. Each reduces environmental impact. Most also reduce cost.

Eco-friendly shipping is the practice of reducing the material waste, fuel consumption and carbon emissions generated by order fulfillment — through packaging choices, carrier efficiency and delivery success rates. For Indian SMBs, it means rightsizing packaging, switching to recyclable or biodegradable mailers, eliminating unnecessary void fill and reducing failed deliveries.

Sustainable shipping in Indian ecommerce does not require new investment. The highest-impact changes are structural: matching box size to product, replacing plastic mailers with kraft or certified compostable alternatives, removing unnecessary void fill and reducing RTO rates. Each change cuts material consumption and emissions. Most cut shipping costs at the same time.
Under India’s Plastic Waste Management Rules, 2016 — as amended in 2018, 2021, 2022, 2024 and most recently March 2026 — producers, importers and brand owners using plastic packaging are subject to Extended Producer Responsibility (EPR) obligations, mandatory recycled content targets and compostable packaging certification requirements. These are compliance imperative as much as an environmental one.

· 25-30% — share of COD orders in India returned to origin (ET Prime Research, as cited by Dazeinfo)
· ₹180–240 — combined forward and reverse logistics cost of each failed delivery
· 10% — minimum recycled plastic content now mandatory for flexible packaging (Category II) from 2025–26, rising to 20% from 2027–28 (PWM Rules 2026)
· 2-3% — RTO rate for prepaid orders in India, vs. 25-30% for COD

Rightsize packaging to reduce shipping cost is the single highest-leverage change an SMB can make — and it costs nothing beyond a one-time audit of your SKU-to-box-size mapping. As Amazon Shipping India’s guide to rightsizing packaging details, the financial and environmental case for getting this right is stronger than sellers may realise.
Indian carriers use a dual-billing model: every shipment is priced on actual weight or volumetric weight, whichever is higher. Volumetric weight is calculated as Length (cm) × Width (cm) × Height (cm) ÷ 5,000. The moment your packaging is bigger than it needs to be, volumetric weight exceeds actual weight — and you pay for ghost kilograms that contain nothing but air. A ClickPost study reported by The Economic Times estimates that internal logistics inefficiencies of this kind cost India’s organised retail sector over ₹2,000 crore annually.
The environmental impact runs in parallel. Oversized packaging reduces the number of parcels that fit in a delivery vehicle per trip — directly increasing fuel consumption and carbon emissions per order delivered.

Rightsizing also reduces your regulatory burden directly. Every gram of plastic packaging — bubble wrap, polybag, tape — that you eliminate through smaller boxes is a gram you do not have to track, report or offset under your EPR obligations. The compliance case for rightsizing is as real as the cost case.

Biodegradable mailers are more accessible and more cost-competitive than they were two years ago. For soft goods, apparel, stationery, books and most non-fragile D2C products, a plastic poly mailer is not the only option — and it is increasingly not the compliant one.

The governing framework is the Plastic Waste Management Rules. Here is what applies to an e-commerce SMB today.
EPR registration (2022 onwards): All producers, importers and brand owners (PIBOs) introducing plastic packaging into the market must register on the CPCB’s EPR portal and meet annual recycling and recovery targets. If your business qualifies as a producer, importer or brand owner under the Plastic Waste Management Rules and introduces plastic packaging into the market, EPR registration and reporting obligations may apply.
Compostable packaging certification (tightened in 2024): Under the Plastic Waste Management (Amendment) Rules, 2024 notified by MoEFCC on 14 March 2024, manufacturers of compostable or biodegradable plastic packaging must obtain CPCB certification before marketing or selling. If you want to use or market packaging as “compostable,” it must conform to IS/ISO 17088:2021 as specified by the Bureau of Indian Standards (BIS) and carry a valid CPCB registration number.
Mandatory recycled content (2026 onwards): The Plastic Waste Management (Amendment) Rules, 2026 notified on 31 March 2026 require PIBOs to use a minimum percentage of recycled plastic in their packaging. The schedule is as follows:

As per the 2026 amendment, recycled plastic packaging must conform to IS 14534:2023 and carry prescribed labelling, subject to sector-specific statutory restrictions.

When sourcing sustainable mailers, verify the following before ordering:
• For compostable products: confirm IS/ISO 17088:2021 certification and CPCB registration number
• For recycled-content packaging: ask for the percentage of post-consumer recycled (PCR) content
• For kraft mailers: confirm they are uncoated or water-based coated, which allows curbside recycling

Dunnage — the void fill inside a box — is where packaging waste accumulates invisibly. Bubble wrap, thermocol (expanded polystyrene), plastic air pillows and foam sheets are the most common materials used by Indian SMBs to fill the gap between product and box. Most of this material is avoidable through better box-to-product fit (Section 1) and smarter material choices.

Note on Thermocol: Expanded polystyrene (EPS) used as packaging void fill is not explicitly listed in the banned single-use plastic items schedule under the July 2022 Ministry of Environment, Forest and Climate Change (MoEFCC) notification. However, EPS falls under EPR obligations as a plastic packaging material and near-zero municipal recycling infrastructure across Indian cities means it goes to landfill at the end of its first use. Replacing it with corrugated or pulp inserts is both the more sustainable and the increasingly more cost-effective choice.

A failed delivery does not just cost money. It significantly increases the environmental footprint of an order by adding reverse logistics, extra handling and sometimes repackaging
Sustainable shipping India ecommerce strategies that focus only on packaging materials miss this entirely. Delivery success rate is the most direct measure of shipping efficiency — environmental and financial.

According to research, approximately 25–30% of cash-on-delivery (COD) orders in India are returned, compared to 2–3% for prepaid orders. Industry data from 142 Indian D2C brands tracked through 2024 shows COD contributes to 76–83% of total RTO volume in Tier-2 and Tier-3 markets. Each RTO costs a seller between ₹180–240 in combined forward and reverse logistics — and generates zero revenue.
From an environmental standpoint, every prevented RTO eliminates one full return journey of vehicle emissions, repackaging material use and carrier handling.

• Confirm delivery address via WhatsApp or SMS for all COD orders — address errors and customer unavailability together account for the majority of avoidable RTOs in Indian e-commerce
• Prompt customers to add a landmark for Tier-2 and Tier-3 pin codes
• For high-value orders, convert COD to prepaid through an incentive (small discount or free shipping upgrade)

• Choose a carrier with OTP-verified delivery — this creates a logged proof-of-delivery record and significantly reduces disputed “delivered but not received” cases
• Ensure real-time tracking is visible to the customer to reduce pre-delivery cancellations

• Act on NDR alerts within 4 hours — the probability of successful reattempt drops significantly after 24 hours
• Give the customer a concrete rescheduling option, not just a notification

Amazon Shipping’s seller dashboard surfaces NDR exceptions with rescheduling options built in — meaning sellers can act on a failed attempt before the customer raises a complaint. OTP-verified delivery creates a logged proof-of-delivery record for every completed shipment, reducing disputed delivery claims. With delivery success rates of 98%+ for prepaid shipments across 14,000+ pin codes, fewer shipments enter the RTO cycle in the first place — which is the most direct path to reducing the environmental cost of last-mile delivery.

Switching to green packaging for D2C brands creates a visible brand moment — if you communicate it correctly. The risk is overclaiming. Customers in India are increasingly skeptical of vague sustainability language (“eco-friendly,” “green,” “planet-safe”) with no substance behind it.

A single printed line on the inside flap or a small insert card is enough. It needs to be specific and verifiable — not a campaign.

Rightsizing packaging and eliminating unnecessary dunnage typically reduce material costs. Switching from plastic poly mailers to kraft mailers is cost-neutral or marginally cheaper at volume. The only meaningful cost increase is in CPCB-certified compostable mailers — typically 10–20% higher — and that differential narrows as volume increases.

In India, ‘compostable’ has a clearer certification pathway for packaging claims. Businesses should be cautious about unsupported ‘biodegradable’ claims, because they can be misleading and may not satisfy applicable compliance requirements.

This is among the persistent myths in SMB packaging decisions. Products need cushioning against the walls of the box — not room to travel freely inside it. The goal is immobilization, not isolation. An oversized box with loose void fill creates exactly the conditions for in-transit damage: the product shifts repeatedly against hard surfaces during sortation and last-mile handling. A snug-fit box with well-placed die-cut inserts or minimal kraft crumple wrap is structurally more protective, costs less to ship and uses less material.

Reducing failed deliveries has a larger environmental impact than any single packaging material switch. A seller shipping 500 orders a month at a 25% RTO rate generates 125 return journeys per month, each consuming fuel on both the forward and reverse leg. Switching from plastic to kraft mailers on those same 500 shipments reduces material waste but does nothing to eliminate those 125 double journeys. A 5-percentage-point reduction in RTO — from 25% to 20% — removes 25 full return journeys per month. No packaging change achieves an equivalent reduction in transport emissions.

Under the Plastic Waste Management Rules, 2016 as amended — with EPR obligations introduced in 2022 and progressively tightened in 2024 and 2026 — EPR registration, annual targets and mandatory recycled content requirements apply broadly to producers, importers and brand owners that introduce plastic packaging into the market. Businesses should verify whether they fall within the relevant PIBO definitions and portal requirement. The 2026 rules also introduce Registered Environment Auditors and mandatory labelling requirements.

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