Five Ways to Achieve Your Sustainable Packaging Goals
While product packaging is the most visible factor, going with a biodegradable bag will not move the environmental needle much. In fact, the supply chain of a typical Consumer Packaged Goods (CPG) company is responsible for 80-90% of its carbon footprint. Per McKinsey, if consumer goods companies intend to meet their current sustainability targets, they will need to more than halve their greenhouse-gas emissions by 2030. Critical to this is working closely with their contract manufacturers (CM) to implement sustainable practices throughout their supply chain.
For sustainable product manufacturing to make a true positive impact, companies need to take a wide angle look at the problem. Here are five specific ways CPGs and CMs can work together to achieve better sustainable packaging outcomes:
Understand the Current Benefits and Limitations of Sustainable Packaging
Research conducted by the Center for Sustainable Business at NYU Stern found that sustainability-marketed products delivered 50.1% of market growth from 2013-2018, while representing 16.6% of the CPG market in dollar sales in 2018. Products marketed as sustainable grew 5.6x faster than conventionally marketed products, and 3.3x faster than the CPG market. As such, consumers have shown the desire and willingness to pay more for eco-friendly products that use sustainable options for packaging.
But transitioning to sustainable packaging is not a simple one-for-one swap with a standard plastic material. For large-scale manufacturing, 100% bioplastics are not yet available in mass. However, blended products (i.e., those with 50-80% biopolymer) are a good option to balance availability and cost. Companies should ensure their CMs have experience working with recyclable and biodegradable bioplastics made from plant materials.
Furthermore, while the barrier protection on primary packaging is not yet commercially available to meet the shelf-life consumers expect, secondary packaging like stretch / shrink wrap are great options for bioplastics. And while traditional sourcing or procurement people won’t like the cost (they are, unfortunately, 3-4x more today than virgin plastic), the total impact on the final shelf price is extremely minimal and the growth shown by sustainable products should outweigh the impact.
Design Packaging to Minimize Waste
CPG companies can reduce their environmental impact by minimizing waste and scrap alongside their CM. This includes working with the CM as part of product development to ensure R&D and design are not building scrap inherent to the manufacturing process. For materials that do end up wasted, contract manufacturers that have scalable processes and partners in recycling, animal feed and composting will further reduce environmental impact.
Source Raw Materials Responsibly
Another important aspect of sustainability for CPG companies is material sourcing. This means ensuring that the ingredients and raw materials used in their products are grown or produced in a way that is fair to workers and respectful of the environment. CMs with strong procurement and recycling programs of their own, especially in corrugate and plastics, likely have relationships with suppliers that can provide post-consumer recycled materials at scale.
Include Energy Usage in the Equation
CPG companies can also work with contract manufacturers to implement more energy-efficient practices in their manufacturing facilities. This can include things like upgrading equipment to use less energy or implementing renewable energy sources. In addition, CPG companies can work with contract manufacturers to reduce water usage and improve water management.
Lastly, CPG companies can work with contract manufacturers to promote transparency and accountability throughout the supply chain. This can include implementing traceability systems, which allow CPG companies to track the origin of ingredients and raw materials, as well as implementing third-party auditing and certification programs, which can help to ensure that sustainable practices are being followed throughout the supply chain.
In all of the above topics, MSI Express has made significant strides to help our customers achieve their sustainability goals. See here for more information and talk with us today about how we can help you achieve your sustainability goals.