Sustainable packaging is a buzzword these days for the food manufacturing industry, but it’s not what you think. Yes, care for the environment is important; we have only one planet that we share and if we don’t take care of it, we’ll be out of a place to live. Sustainable packaging is more than a nod to environmentalism. It’s smart business sense—and here’s why.
Food Engineering, a publication for the food manufacturing industry, published an article related to this very topic. In it, they quote an article from the State of the Industry—U.S. Packaging Machinery Report 2017 from PMMI, The Association for Packaging and Processing Technologies in which the demand for easily recyclable packaging materials is expected to grow. If you aren’t investigating or actively using sustainable packaging, now is the time to do so, because the consumer base is shifting towards Millennials who value such touches in their products.
What Is Sustainable Packaging?
Sustainable packaging for the food industry is a concept with a loose definition. However, it should meet some or all the following characteristics:
- Safe to use – packaging that does not leach questionable (although acceptable in the industry) chemicals into food products
- Easy to recycle – consumers can easily and clearly add it to one of their recycling bins
- Low manufacturing impact – from start to finish, the manufacturing of the packaging materials does not compromise the environment or create residue or waste products that can harm the environment
- Green energy – may be sourced, made, or transported using renewable energy
- Meets manufacturers requirements – meets industry standards and requirements for safe transportation and handling of food products
Add to this the need to be transportable for the consumer, build the company’s brand awareness, and not be too expensive, and you understand why sustainable packaging can pose a challenge.
Is Sustainable Packaging Expensive?
At first glance, this list looks daunting—and expensive. However, field-tested sustainable packaging has proven to be comparable to or even less expensive than conventional packaging. Walmart tested sustainable packaging for children’s products and found that it saved $3.5 million in transportation costs alone as well as considerable energy and resource costs. The packaging was a clear winner when compared to older, conventional packaging.
Not to be outdone, food manufacturers see clear benefits as well. Coca-Cola, for example, switched to sustainable packaging and claims it saved $180 million per year. McDonald’s and other fast food restaurants, as well as convenience food manufacturing companies, are also exploring sustainable packaging as an alternative that appeals to consumers and makes sense to their bottom line.
Sustainable Packaging to Acquire and Retain Customers
We’ve saved the best news for last: sustainable packaging may help you acquire and retain loyal customers.
The Millennial demographic, defined as people born roughly between 1980 or 1985 and 2000, values environmental awareness and sustainability issues. In the United States, the Census Bureau reports that there are actually more Millennials than Baby Boomers, with 83.1 million born roughly between 1980 and 2000. In Canada, Millennials also represent the largest generation.
With such a large demographic moving into their prime years as consumers and Millennials viewing packaged food products as a daily staple rather than a sometimes treat, it makes sense for food manufacturers to switch to sustainable packaging.
Food ERP systems can help you accurately estimate the costs of such packaging and how it may impact your bottom line. With the switch to sustainable packaging, you may see an increase in sales that offsets any possible increase in production costs. The only way to know this for sure is to use your food ERP system to compare costs.
IWI Consulting Group
IWI Consulting Group works with food manufacturers and other industries to provide solutions to enhance productivity and profitability. Food ERP is just one of the many areas of ERP we work with and we support a full range of Sage software products that are perfect for manufacturing. For more information or assistance, visit IWI Consulting Group or call 1-866-916-3851.