Boosting Supply Chain Efficiencies with Reusable Transport Packaging
July 12, 2012
By Justin Lehrer
In today's economic climate, retailers and suppliers are feeling the pressure to make their operations as efficient as possible to stay profitable and competitive. At the same time, environmental regulations are likely to get more stringent, and sustainable practices increasingly important for a company's reputation.
The good news is that a closer look at your shipping system may reveal opportunities to boost efficiency and decrease environmental impacts at the same time-with reusable transport packaging. Reusable totes, pallets, bins and tarps are durable, long-lasting alternatives to corrugated cardboard boxes, disposable pallets and stretch-wrap. While shipping in reusables is a common practice in some retail sectors, their potential is still underutilized in others.
Modern Milk Runs
Reusable transport packaging lends itself best to frequent and consistent deliveries made in a closed transport loop, where goods are shipped directly from the manufacturer to the retailer, and trucks bring back the empty pallets, trays and crates on the return trip. Making these "milk runs" with reusables is standard practice for the delivery of milk, bread and soft drinks.
But any closed loop shipping systems can reap the benefits of reusable transport packaging because reusables last longer, lower material costs over time and nearly eliminate packaging waste disposal costs right away. Reusables also provide superior product protection. Perishables in particular benefit from reusable plastic containers (RPCs) that hold up against moisture and allow for ventilation. Frank Ratto, vice president of marketing, introduced reusables at produce supplier Ratto Bros in Modesto, Calif. Although he was reluctant at first, he was quickly won over by the dramatic reduction in spoilage observed during processing and shipping.
Third Party Poolers
But what if a closed loop system is not an option? Today's retail chains receive tens of thousands of different products from a multitude of suppliers, few of them local. It would not be feasible for any one manufacturer to ship in a closed loop using reusables. This is where third party poolers come in. These companies lease standardized pallets and containers to suppliers of retail merchandise on an as-needed basis, often as a full-service package that includes container delivery, tracking, pick-up, cleaning, maintenance and storage.
In the produce industry, for example, empty RPCs are delivered to growers, filled and shipped first to the growers' cooling and processing facilities, then directly to the retailer's distribution center (DC). There, a number of different commodities are picked and stacked on pallets for delivery to individual stores. After use, the containers are returned from the stores to the DCs, then picked up, cleaned and redistributed by the pooler. Because all growers serviced use the same RPCs, no repackaging is needed, which reduces labor and product damage.
Kroger, the largest U.S. grocery chain has used RPCs for many years, eliminating more than 45 million pounds of waxed and corrugated boxes annually that would otherwise require disposal. "What started as a sustainable solution to ensure the highest quality of fruits and vegetables for our customers has grown into an impactful way for Kroger to reduce waste and improve supply chain efficiency," said Phil Davis, senior perishables supply chain manager for Kroger. Safeway recently followed suit transitioning to RPCs for much of its produce shipping system. For more on this see "Safeway Expands Reusable Product Container Usage to Produce."
Reusables for Less
Another key application for reusable transport packaging materials is the redistribution of bulk shipments to individual retail locations, usually via a distribution center. Breaking the larger shipments into mixed, less-than-caseload deliveries tailored to a given store's current needs reduces the storage space and inventory-related labor that stores would otherwise have to provide. With a typical payback period of less than one year, reusable totes for repacking save material and disposal costs, while offering better stability and ergonomics. The result: an overall boost in supply chain efficiency.
Pep Boys, a retail chain serving the automotive aftermarket, equipped their distribution center in Chester, N.Y., with 45,000 reusable plastic totes for the shipment of repacked goods to retail stores. The containers have attached lids and can be nested when empty, taking up little space at the store and on the return trip to the DC. Two different tote sizes enable DC staff to accommodate the wide variety of density in Pep Boys' products. This prevents totes that are too heavy to lift, as well as under-filled totes that would waste space.
In addition to "classic" reusables, new applications are increasingly becoming available. Reusable pallet wrap is quickly gaining traction, particularly in food manufacturing and distribution. Typically made of durable plastic tarp with straps and buckles, reusable pallet wrap secures pallet loads during transit and warehousing just like plastic stretch film-without the waste.
Many resources are available to help you assess and optimize the transport packaging materials used in your shipping system, including the Use Reusables campaign. Use Reusables is a joint project of public agency Stopwaste.Org and the Reusable Packaging Association, with financial support from the U.S. EPA's Climate Showcase Communities program. The campaign offers training workshops, financial assistance, expert advice and educational materials. For more information and to sign up for email notifications, visit www.UseReusables.com.
Justin Lehrer is a program manager at StopWaste.Org in Oakland, Calif. He also leads the Use Reusables campaign. Justin can be reached at firstname.lastname@example.org.
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