Industrial Packaging – The Entry Point for Sustainability
Why Packaging is the Place to Start
We hear the question a lot. “I want my company to be more sustainable, but where do I start?” It’s understandable. Sustainability has been a topic of business discussion for many years, however recently the ramp up in concern has been steep…very steep!
Gone are the days that sustainability was simply a talking point, mostly used in conjunction with a PR campaign. Now, sustainability has a seat at the boardroom table. More companies are becoming hyper aware of the need to be more sustainable as ESG scores are on the books, and sustainability professionals have joined the C-Suite.
For starters, most companies look at their energy usage strategy or ways to reduce waste. Both are methods to reduce carbon emissions but might also have limited runway. Businesses today can purchase greener energy or offset that with localized renewables. Waste reduction was popular before the big sustainability push, simply because it was a way to cut costs and expenses. Both are great starts to a more sustainable path, but that is just the beginning.
The real game changer in the sustainability effort will be materials. Incorporating sustainable products will be paramount to reducing emissions and new, bio-friendly materials can reduce or even reverse your emissions. One of the big challenges in revamping our materials choices can be the time to market, especially when certifying new materials to meet current/future specifications.
Also, for new products, development cycles can be several years or more. Is there a way to get the advantage of carbon-reducing materials on a shorter timeline? Yes, and the answer is in a sector of business that nearly every company participates in – packaging.
Packaging might be the easiest point of entry for any business looking to become more sustainable. Why? Because packaging is rather homogenous to all businesses. If we look at products packaged inside cardboard boxes, or that are loaded into a wooden container, or wrapped on a pallet, virtually every company (sans pure service organizations) has the tools and expertise to pack and unpack goods. There is a fairly limited subset of materials used in packaging, and all represent an opportunity to go “greener”.
The Evolution of Packaging
As far as packaging goes, the technology is basically the same for everyone. Yes, some products come in specialized containers, but almost every item is packaged in a way to move through various channels in the supply chain. Let’s take soft drinks for example. They can be packaged in cans or bottles, then containerized in boxes, those boxes are then palletized for longer-range shipments. This is the same model for many products, various and layered packaging depending on the shipping method, distance traveled, and/or the degree of protection needed.
Product packaging has evolved a great deal to accommodate the needs of consumers, but also the needs of the manufacturers. Packagers have found lighter materials to protect goods – polyethylene foam vs. cardboard for example. They have also found that heavier-duty pallets can carry more weight to accommodate larger loads on a truck. The problem being that the materials of the late 20th century were not all that great for the environment, because most packaging material is cardboard/paper (40-50%), plastic (20-30%) and wood (5-10%).
These materials account for almost all packaging and can easily be replaced and/or augmented to reduce their carbon footprint. We know that wood is renewable, but not endlessly sustainable. For that reason, many pallet manufacturers have moved away from wood and towards plastics because of the increasing costs of wood-based materials and the cost to maintain wooden pallets. More expensive materials like aluminum and glass are also in the mix, however they lend themselves more easily to recycling.
Packaging Today
Packaging began to move more into the forefront from a branding standpoint since the age of mass consumerism starting in the early 20th century, and protection of goods during transport was the core reason behind packaging to begin with. However, today packaging is getting a lot of attention from a sustainability perspective – as it should! Some designers, like Guacamole Airplane even specialize exclusively in sustainable packaging.
In 2023 and beyond, there will be even more focus on how damaging (or beneficial in some cases) to our environment that product packaging is. The use of petrochemical-based plastics and the clearing of old growth timber is simply not sustainable. Recently, the need for health consciousness has served as the driving force behind some of the changes and banning some packaging materials that were dangerous. However, now there is even more focus on packing materials that pose an overall danger to the health of our planet, be it consumer or industrial packaging.
Consumer vs. Industrial Packaging
Packaging used for consumer-packaged goods (CPG) is typically inexpensive and lightweight. The packaging for these consumer products is meant to give the customer relevant information on the product they’re looking to buy. Traditionally, the information on this type of packaging illuminates the problem, solution, or how the product is different from the others. Consumer packaging is meant to position against competitors, so in some cases the packaging is clear to show the product inside, or its design is meant to stand out amongst all the other products on the display aisle at your local store. Plastic is the material of choice here.
Industrial packaging is much different. The equipment that is purchased by large manufacturers is typically expensive, voluminous, heavy, and many times even fragile.
These large industrial machines may be as big as your garage, but that doesn’t mean they are capable of surviving a drop off a loading dock or being bounced down the highway in the back of a semi-truck.
This means there is very little room for failure when packing them up for transport. Being able to see the product while packaged is of little concern. That’s why wood and heavy-duty cardboard are the materials of choice, rather than plastics. However, plastics can be used as an internal wrap to protect the contents from moisture and other contaminants.
Industrial packaging is also engineered for longer travels across varied mediums. For example, large electronic devices, say a rack of servers for a data center, need to be packaged to not only protect the device against drops but also long shipment voyages overseas (saltwater contamination), by air (extreme low temperatures) and eventually by truck (bumps and vibrations).
Industrial packaging must be robust, and many times the weight of this packaging can actually exceed the weight of the product that it’s protecting! This is why new, lighter, more sustainable materials are being sought out by packaging engineers to replace the traditional materials like woods, foams and even asbestos.
Traditional Materials
With the majority of packaging being plastics, woods and paper, it’s easy to see a more sustainable path forward. The energy (mostly fossil-based) and carbon emissions to produce packaging from these traditional materials is significant. Up until the 1950s, wood was the prevalent material used for shipping, that eventually gave way to plastics.
For generations, the crates and pallets that manufacturers relied on for their shipments were made from wood. When our GDP was 1/10 the size it is today, this was a viable solution. Since demand is consistently increasing and there’s a finite number of trees, manufacturers are forced to look for alternative solutions.
Recently, some manufacturers have realized that using wood as a shipping material comes with some major problems:
- A large percentage of the wooden pallets and crates break every year.
- Fixing these wooden parts is time-consuming and dangerous (sharp edges, rusty nails/screws, etc.).
- Continuously cutting down trees to make packaging products is not sustainable.
As the advent of plastics rose, so did its use in packaging. It’s estimated that up to 90% of plastics are used for packaging, much of that in the form of single-use applications (water bottles, candy wrappers, etc.). Since most of the plastic is petrochemical based, it’s easy to see that it comes with a high carbon footprint.
Paper and cardboard come from renewable resources (trees mostly); however the growth cycle of trees can be years or decades. Plus, harvesting in deep wooded areas and mountains demands a great deal of energy. The exact carbon footprint of paper can vary widely, but some estimates suggest that the production of one pound of paper can release between 1.5 to 2.1 pounds of carbon dioxide into the atmosphere, meaning paper is carbon-positive.
Since the world is beginning to transition toward a more sustainable future, leaders across manufacturing are actively looking for alternative materials to optimize their products and supply chains.
Fortunately, America is building reliable supply chains of more efficient bio-based materials, and these supply chains can support manufacturers by providing additives that increase the performance and reduce the carbon footprint of the raw materials already in use.
An Elite Bio-Based Alternative – Industrial Hemp
There are many bio-based materials (sans traditional wood) that are being engineered and tested as better solutions to our industrial packaging crisis. One of the most promising is Industrial Hemp as an additive for plastics, rubbers, foams, paper, and cardboard.
Even with the most eco-friendly of traditional materials, paper, the carbon offset is 1:1.5. Meaning that every pound of paper, produces 1.5 pound of CO2. Whereas hemp is carbon-negative to the tune of 3:1, and results in 3 pounds of CO2 REMOVED from the atmosphere for every pound produced! Also, hemp grows in a 90-day cycle, compared to years for trees, adding to the carbon-negative effects. On top of that, hemp has been known for centuries for its outstanding fiber characteristics.
Industrial Hemp has a 10,000+ year history of being the strongest natural fiber in the world and it has proven to be useful in thousands of applications across almost every industry, albeit on smaller scales. Today we have firms researching and developing hemp as a viable solution for industrial packaging; and the engineering efforts are finding a multitude of new uses for this robust product.
Previously, one of the major hurdles American manufacturers have faced is that they don’t have access to a reliable industrial hemp supply chain. This has prevented product developers from using high-performance bio-based additives in the next generation of products. Fortunately for manufacturers, investors, and consumers, this is all changing in real-time. Since 2017 and the advent of the 2018 Farm Bill, hemp production is up about 670% in the U.S. alone.
Hemp is Not Only Strong, It’s Light!
One of the key metrics that are measured for industrial packaging is weight. A large portion of the weight of any shipment is the packaging. If we can reduce the weight of the packaging, we can increase the number of units that are shipped in each load. Reducing the weight of packaging instantly reduces logistics costs and carbon footprint.
For example, as car parts are shipped throughout the automotive supply chain, they rely on heavy and expensive packaging. In fact, 50%+ of the weight of the shipment from one automotive supplier to another can be packaging. As you can imagine, these car parts are large, so the packaging they rely on is clunky.
Heartland’s team is actively working with automotive OEMs, as well as the tiered suppliers that support them, to reduce the cost, weight, and carbon footprint of their packaging. Reducing the weight of the packaging is one of the easiest ways that a manufacturer can make its supply chain more sustainable. Hemp additives are an easy drop-in for manufacturers that use plastic as a raw material.
Reducing our Carbon Footprint
Here we see the most powerful benefit of transitioning to natural materials. By using bio-based additives such as industrial hemp to replace or augment these traditional materials, we can realize a reduction in the carbon footprint on the magnitude of 40% or more.
At Heartland, we focus on both use cases of cardboard and plastics for packaging. Industrial hemp can be blended into virtually all cardboards and papers because of its high fiber content. Hemp can increase their performance because of its incredible fiber strength. The same is true for many plastics. On top of that, hemp is a carbon-negative material, so the carbon footprint is reduced significantly. Reducing your business’ carbon footprint is a leading indicator meeting your sustainability mandates.
Every large company today has a “sustainability mandate.” Some notable leaders include Patagonia, Tesla, Ikea, and Unilever. Microsoft even has cloud-based Sustainability Manager software.
These mandates are a way to track a company’s sustainability activities and results, and ultimately report on the actions they’re taking to become more environmentally friendly. Today, many of the top companies that are leading the sustainability movement are focused on measurably reducing their carbon footprints.
To do that, they only have a few options:
- Use less materials (which means selling fewer goods).
- Use recycled materials.
- Use clean energy.
- Use carbon-negative materials and additives to reduce the footprint of each product and its associated packaging.
These initiatives can all help companies reduce their carbon footprint, but only one is well known to all industry leaders – clean energy. Clean energy initiatives and recycling programs have been around for decades. These are not inherently new or innovative.
The top executives at large companies know that the long-term path to carbon footprint reduction is to use carbon-negative materials. Since most companies plan on expanding production, they need to find a way to reduce the carbon footprint of the materials they rely on every day. By using carbon-negative materials in your packaging, you are essentially boosting the value of your sustainability solutions with every increase in production, instead of amplifying your problems!
Industrial hemp plastic and paper additives are an easy starting point for carbon footprint reduction initiatives, and we now are seeing the beginnings of a reliable industrial hemp supply chain emerging. This means that the process of using carbon-negative materials can now move beyond the theoretical stage.
Sustainable Packaging + Marketing = A New Competitive Advantage
Most packaging conversations center around manufacturing and operations. However, we did discuss how packaging began its relationship with branding in the early 1900’s. Since that time, most packaging was used to inform the consumer about product quality, positioning and overall promotion.
Today, packaging is becoming a central topic in sustainability, and a marketer can use sustainability data to craft messaging to customers.
Follow any of the links to the companies above to see how they use sustainability data to:
- To develop sustainable products/services.
- To position their brand as environmentally responsible.
- To make data-driven decisions on sustainable business practices.
- To measure and track the impact of sustainability initiatives.
- To create targeted marketing campaigns for eco-conscious consumers.
Marketing can benefit sustainability efforts by raising awareness and highlighting the importance of sustainability and the positive impact it has on the environment and society. Marketing campaigns can also increase consumer knowledge and encourage more sustainable behavior.
We see today that companies that prioritize sustainability can differentiate themselves from their competitors and build a positive brand image, attracting customers who are conscious of environmental and social issues.
Marketing campaigns can not only promote products, but also support corporate sustainability initiatives, such as reducing carbon emissions or conserving resources. They encourage innovation by highlighting new, sustainable technologies. Finally, inspiring marketing can persuade company leaders to invest in these types of research and development projects, ultimately driving them towards a more sustainable future.
Sustainability Without Compromise
Manufacturers across the world are all looking to become more “sustainable.” But traditionally, they will hesitate if there’s an increase in cost.
In an ultra-competitive world, companies do not want to thin out their margins, and a single significant cost increase can quickly flip their business models upside down. This is something Heartland has been extremely mindful of as we work with manufacturers that are interested in industrial hemp additives.
Let’s face it, the first question that comes up in any major shift in business process will be centered around the costs. We do see major issues with customer needs and market trends, compliance, and company strategy, but at some level the driver always seems to be balancing revenue and expenses.
At times, competing at this level can be difficult. Many of the mined and synthetic goods used as additives in plastics are dirt cheap because they are abundant. How can an agriculture supply chain compete with minerals like talc and calcium carbonate? Exactly on what we just outlined earlier– weight!
Hemp materials are 80%+ lighter than the materials that they replace. This means, if a traditional plastic application would need 1 pound of talc, it would only need 0.2 to 0.3 pounds of hemp to create the same volume (in cubic feet). This means that the metric we’re competing on is not “price per pound,” it’s “cost in use.”
For example, if talc is 20 cents a pound, and hemp is 60 cents a pound, it’s cheaper to use the hemp because you need so much less of it to get the same result. This is a groundbreaking concept for manufacturers that are used to only looking at raw materials in terms of “cost per pound.” The result is sustainable packaging that’s on par, or even less than traditional methods.
For sustainable packaging to become a priority for many companies, it will require a careful balancing act. We need to make sure that the costs of switching to eco-friendly packaging don’t outweigh the benefits.
To make this happen, we must invest in innovative solutions that reduce waste without compromising product safety or performance. With the right strategies and investments, we can create a future where sustainable packaging is the norm rather than an exception.
We see a day when all businesses operate at a carbon-neutral level. They’ll exclusively use renewable energy, produce significantly less (or even no) waste, and use materials that aren’t finite, and aren’t saddled with a heavy carbon footprint.
Some directives point to a carbon-neutral economy by 2030. That’s a tall order (to say the least!) but in the transition, sustainable packaging may be the best option today, to help us reach our goals tomorrow.
Please reach out if you feel that industrial hemp materials could make a positive impact on your manufacturing operation.
Join us in creating a carbon negative future.