Since the Wal-Mart packaging scorecard was formally introduced in late 2006, suppliers across the full spectrum of the company’s supply chain have been working to increase their sustainability scores and become more competitive in doing business with the largest retailer in the world. On February 1, 2008, the program was officially implemented and vendors, distributors and suppliers began to be formally evaluated based on their ability to use their packaging and materials smarter than ever before. However, many consumer packaged goods (CPG) companies are still struggling with how to improve their overall sustainability score and become a favored Wal-Mart supplier.
Reducing overall fiber in corrugated boxes is an important first step to ensuring high sustainability scores as more than 40 percent of the scorecard value is based on product-to-package ratio, material value and cube utilization. Even the smallest reductions in material use garner big savings when you consider its effects on the entire supply chain. Fiber reduction can be achieved in several ways, by improving the package design, using lower fiber corrugated board and lower weight material. A careful analysis of the entire packaging supply chain will help determine the best steps to be examined and implemented.
Innovate Your Package Design
The majority of fiber reductions come from minor or complete package redesigns in both primary and secondary packaging. Analyzing the product-to-package ratio helps identify sources of inefficiency. Reducing material from unnecessary gaps between the product and package can be a minor change that adds up to real savings over the course of time. Additionally, not all packages require box flaps to meet at closure and leaving slight gaps can help minimize corrugated use. Package redesigns involve more investment but should not be dismissed as they offer key opportunities to reduce fiber and increase sustainability.
Water-heater manufacturer A.O. Smith Water Products Company is a strong example of turning packaging alterations into increased sustainability and profits. A.O. Smith turned to the expert engineers at Georgia-Pacific’s Packaging Systems Optimization (PSO) program to develop a comprehensive plan to reduce fiber through a major package redesign.
Careful analysis of the packaging supply chain revealed that A.O. Smith could radically redesign the foundation of the box that secures the heater in place, called the locator base, by laminating the existing corrugated base and adding plastic clips to secure heaters. These small changes drastically reduced overall corrugated usage by one-third while decreasing storage and optimizing logistics. The new design also ensured proper nesting, impact resistance and enhanced vertical height for securing the heaters in the boxes. The fiber reductions not only resulted in cost savings, but also led to sustainability improvements, including a 529-ton fiber reduction, a 1,423-ton decrease of greenhouse gas (GHG) emissions and a 12,492MM BTU usage cut.
Use Less Fiber within Corrugated Board
Removing fiber from traditional corrugated board used to be challenging as it reduced strength and compromised the integrity of the package. However, alternatives such as microflute offer sustainable fiber reductions while maintaining necessary durability. This low-fiber solution fulfills primary packaging demands and, in some cases, allows the replacement of secondary packaging which enhances the ability to showcase high graphic impacts and offer Point of Purchase (POP) appeal.
Consider Lower Weight Material
Not all products require substantial amounts of corrugated material to maintain the product’s integrity. Over-packing products is not only bad for the bottom line, it’s also bad for the environment. Lower weight material could be a viable option for securing the product while improving profitability due to reduced package cost, and sustainability due to reduced fiber usage. With a variety of flute sizes available, choosing the right one could be the difference between a package containing excess material and one that is optimized for maximum benefits.
Bringing It All Together
A thorough analysis of the packaging supply chain is one way to uncover sources of inefficiency. Additionally, taking a closer look at the design of the package will help decipher a viable solution, from small changes to complete packaging line redesign.
Whether incorporating sustainability is part of a business model or a desire to meet major retailer demands, there is no reason to wait until the Wal-Mart deadline of 2013 to optimize your package. Ask your supplier for the best alternatives to meet your needs. Suppliers like Georgia-Pacific can provide the expertise to assess your packaging supply chain and help you reach high-hanging fruit otherwise overlooked from your day-to-day routine.
Georgia-Pacific’s Packaging Systems Optimization (PSO) program consists of a rigorous, five-step process, wherein a team of packaging engineers analyzes a company’s entire packaging supply chain, focusing on areas including package design, material optimization, shelf impact and SKU consolidation, as well as line productivity, material handling and distribution. After three weeks, the PSO team delivers a detailed report which clearly outlines areas where cost-savings, profitability and sustainability can be mutually achieved.
The PSO program was developed at Georgia-Pacific’s Innovation Institute, a creative, collaborative environment where Georgia-Pacific and customers identify and reduce supply chain costs, increase shelf velocity and measure sustainability factors. The Innovation Institute simulates retail and packaging environments, allowing customers to experience sustainable innovation and novel package design solutions in action. Designed to facilitate break-through thinking and next-generation packaging solutions, the Innovation Institute helps customers realize the full value of their packaging investment. For more information on Georgia-Pacific’s Innovation Institute, visit www.gpinnovates.com.
Headquartered at Atlanta, Georgia-Pacific is one of the world’s leading manufacturers and marketers of tissue, packaging, paper, pulp, building products and related chemicals. The company employs approximately 50,000 people at more than 300 locations in North America, South America and Europe.