Manufacturers of rigid plastics packaging are increasingly responding to the demands of brand owners and co-packers who seek nimbler, more efficient supply chains and are interested in finding new ways to differentiate their containers and improve the sustainability of their operations and packaging.
It’s no surprise that branded customers, private labels and co-packers are closely scrutinizing their future supply chains by taking a holistic approach, looking at every process involved. They understand that optimized supply chain management will equate to a maximum level of sustainability benefits. Among the key supply chain considerations for rigid plastics packaging manufacturers and the brands and co-packers they supply are raw materials, manufacturing, transportation and consumer experience.
Raw Material Optimization
Center stage among supply chain management activities is innovative design and lightweighting of plastic packaging for a diverse range of end-use applications including soft drinks/water, juices/teas, food, sports drinks, personal care, household, and wine and spirits. Lightweighting can help reduce resin demands and decrease finished container weight while still producing a highly functional and high-performing container that meets sustainability needs.
Lightweight PET, along with other material options like high-density polyethylene (HDPE), are competitively priced with glass, offering improved operational efficiencies and reduced transportation costs. In terms of quality, defects are reduced and greater safety is realized for bottle fillers, retailers and consumers. A recent lifecycle analysis shows that, depending on the bottle application, PET provides a 50-60 percent reduction in carbon footprint compared to glass.
PET also offers strong stacking capability and sustainability benefits. Weight reduction improves transport and distribution efficiency by maximizing utilization of available load space. Rigid plastic containers helps to maintain top-load strength while also allowing for lower-cost substitution of secondary packaging (e.g. corrugated boxes for corrugated trays and shrink film).
Material conversion from traditional materials like glass continues unabated, since PET has an inherent carbon footprint advantage. Supply chains are also enhanced as many brand owners increasingly use recycled materials in their packaging. In addition to enhancing brand equity, using post-consumer recycled (PCR) PET and HDPE has several environmental benefits. Recycling reduces the amount of plastic sent to landfills, and using PCR helps to support the recycling infrastructure and reduces the carbon footprint vs. virgin materials. Using recycled PET or HDPE means that less petroleum is needed to make new, virgin resin. These recycled packaging materials also require less energy to produce and have a lower carbon footprint (50 percent fewer carbon emissions) than virgin PET or HDPE. Manufacturers are working to use PCR without sacrificing container performance.
Supply chain improvements are also possible through simpler manufacturing techniques and the use of new technology and less equipment and infrastructure. Among the key benefits are reduced energy use, labor savings, reduced floor space and greater production flexibility. The ultimate goal is to drive down the price-per-piece cost and gain the most favorable economies of scale. Packaging suppliers like Amcor are also exploring the use of multi-resin packaging machines that save capital, reduce required floor space and allow for new approaches to deliver finished goods more efficiently to retail shelves.
Food and beverage manufacturers initially found that partnering with packaging manufacturers in an on-site operation offered significant supply chain synergies. These practices were then adopted within the home and personal care space. An example is Amcor’s operation of an on-site bottle production facility within Method’s new advanced manufacturing facility in Chicago.
The facility is Method’s first U.S. manufacturing plant and the first LEED Platinum-certified facility in the consumer packaged goods industry. LEED, or Leadership in Energy & Environmental Design, is a green building certification program managed by the U.S. Green Building Council (USGBC) that recognizes best-in-class building strategies and practices. Amcor plays a key role as a manufacturer of 100 percent PCR PET bottles for household cleaners and hand wash products.
The benefits of on-site production of PCR containers includes a significant reduction in freight cost and carbon emissions, improvements in joint operational efficiencies, and enhanced sustainability practices. By using 100 percent PCR resin, the cradle-to-gate energy consumption of the resin compared to virgin is reduced by 52 percent and the package’s carbon footprint is lowered by 57 percent.
Transportation also poses a supply chain dilemma for brand owners and co-packers as rigid plastic packaging suppliers seek to find the optimum production model to serve their customers. Centralized manufacturing plants come at the expense of greater freight cost while more numerous regional plants result in increased capital costs that can sometimes negate the anticipated freight savings.
Packaging suppliers continue to seek manufacturing options that optimize capital, labor and freight costs. Among the key issues is a lack of truck drivers, increased regulation and a concern surrounding accidents. The move to smaller, more flexible production alternatives allows brands and co-packers a new approach to optimizing supply chain and production costs.
Rigid plastics packaging suppliers are also optimizing the supply chain when it comes to the consumer experience. Today’s environmentally conscious consumer demands products that eliminate waste and promote recycling. Consumers don’t want to be part of a perceived environmental problem. They demand highly functional products and are highly influenced by unique designs, labels and other aesthetic qualities that “pop” on the store shelf.
Manufacturers seek to create value in the supply chain by delivering even more impactful design, better bottle definition and new embossing and texturing options that help brand owners differentiate their product and stand out on the shelf. They also seek to incorporate more recycled materials in packaging.
These supply chain considerations — raw materials, manufacturing, transportation and consumer experience — are the lynchpins of Amcor’s new service offering called Amcor 360. The service is powered by LiquiForm, a revolutionary forming and filling technology where liquid product instead of air forms and fills the container in one step. The company’s research and development and operations capability bring a complete solution to customers with many benefits.
Visit amcor.com/amcor360 for more information.