Tag: plastic

Guest Post: Kraft Heinz’s Mission to Reduce, Recycle and Replace its Plastics Packaging

Dr. Misty Blessley is Associate Professor of Supply Chain Management at Temple U.

Kraft Heinz, the fifth largest food and beverage company in the world (founded in 2015 with the merger of Kraft Foods and H.J. Heinz companies), is on a mission to reduce, recycle and replace virgin plastics in their packaging, including their tomato ketchup bottles. In 1983, as did many firms at that time, Heinz introduced plastic bottles as the packaging of choice for its famous tomato ketchup distributed to the retail grocery channel.

Virgin plastic is newly produced plastic, and Heinz has a goal of eliminating 100 million pounds by 2030. This is a reduction of 20% when compared to their 2021 baseline. Kraft Heinz recently stated: “When deciding what packages to focus on, we first see if there’s an opportunity to remove any unneeded plastic, then we look for opportunities where we can reduce plastic weight, add recycled content, or replace plastics with other types of materials, while ensuring we do not compromise the product quality and [do] meet consumer expectations.”

Kraft Heinz was able to reduce plastic by simply removing the bag from some products and worked towards their recycling objective by swapping some virgin plastic with recyclable plastic. They are also replacing their plastic ketchup bottles with a paper-based bottle made of 100% sustainably sourced wood pulp. A prototype is currently being tested, for this first of its kind in the sauce category.

Rethinking the Ketchup bottle, Heinz teams with Pulpex to deliver paper-based packaging

The firm is partnering with Pulpex, a packaging technology company focused on delivering sustainability through renewable packaging. If the bottle in the photo looks new yet familiar, it is because Pulpex is innovating with Heinz’s iconic ketchup bottle, the same one seen on Heinz ketchup (at restaurants, as an image on foil packs and dip and squeeze packs, etc.) since 1876.

Classroom discussion questions:
1. Product decisions are fundamental to firm strategy and to competitive advantage (see pages 161 – 162 of your Heizer/Render/Munson OM text). Given the need for sustainability in operations and supply chain management, why and how has packaging become part of the product decision?
2. Why do you think Kraft Heinz and Pulpex both feel that familiar looking packaging is a customer expectation?

OM in the News: Bumble Bee’s Sustainable Packaging Push

To the Bumble Bee Seafood Company, improving the sustainability and the quality of packaging go hand in hand. The company just announced new outer packaging for its multipack tuna cans made of readily recyclable paperboard. It is the first shelf-stable seafood brand to replace its shrink wrap packaging with a recyclable alternative.

The paperboard is made of 100% recycled material with at least 35% post-consumer content, and is certified by a major sustainability nonprofit. The new packaging has debuted on 23 SKUs, from 4- to 12-can packages. By moving from shrink wrap to paperboard, Bumble Bee will eliminate 23 million pieces of plastic waste per year. (This is an important topic in Supplement 5 in your Heizer/Render/Munson text).

Beyond the sustainability aspect, Bumble Bee saw other benefits to adopting the new paperboard packaging, writes Supply Chain Dive (April 26, 2022). For one, the carton allows the products’ barcodes to be scanned more easily than the shrink wrap, and to be placed on store shelves in two different orientations. In addition, the new paperboard packaging features bright colors and a picture of the tuna cans, along with nutritional information in a way that looks clearer than was possible on the shrink wrap.

This change from shrink wrap to paperboard will move the brand from 96% to 98% readily recyclable packaging. Both the new paperboard packaging and the metal tuna cans are curbside recyclable. A company survey that found 67% of consumers wanted its product packaging to be more recyclable.

“If you think about it, the U.S. recycling system was designed 50 years ago. It was designed for paper and bottles. It’s not designed for the type of flexible plastics that we have today,” said the company’s VP of global corporate responsibility.

Classroom discussion questions:

  1. Why is Bumble Bee making this change?
  2. What other product designs do your students note that have become more sustainable?

OM in the News: Packing Your Beer 6-Pack Sustainably

For many consumers concerned about their food, packaging has become a major factor in deciding what to buy. More than 2/3 consider it important that the products they buy are in recyclable packaging, according to one report. Another study found 58% of consumers said they were likely or very likely to purchase food products in packaging that clearly states it is reusable or recyclable.

With that in mind, companies like Molson Coors can no longer just depend on the taste and ingredients of the product itself to attract consumers but increasingly what the offering is packaged in. As more companies overhaul their packaging to make it more environmentally friendly, competitors have no choice but to respond or risk getting passed over on grocery store shelves, writes SupplyChainDive (March 15, 2022).

So Coors just announced that it will begin moving out of plastic rings this year from its packaging globally in favor of fully recyclable and sustainably sourced cardboard-wrap carriers. To support the move to more sustainable packaging,  Coors is investing $85 million in its operations to upgrade machinery to allow its entire North American portfolio — covering more than 30 brands that currently use plastic rings — to use cardboard wrap carriers by the end of 2025.  Coors estimates the move to cardboard-wrap will save 1.7 million pounds of plastic waste annually by 2025. The announcement moves Coors closer to its goal of ensuring its packaging is 100% reusable, recyclable or compostable, and consumer-facing plastic packaging is made from at least 30% recycled content by 2026.

Many sustainability-minded food companies, from Nestlé and PepsiCo to General Mills and AB InBev, have improved their packaging to help them meet their own environmental goals. Coors would be the largest beer brand in North America to move away from plastic rings.

What started out as a few companies making changes to sustainable packaging has quickly gained momentum across the industry. Nestlé is moving at least some of it Carnation Breakfast Essentials offerings from plastic bottles to Tetra Pak cartons made with paper it claims is responsibly sourced. General Mills’ Nature Valley Crunchy granola bars moved to fully recyclable plastic wrappers and PepsiCo’s Frito-Lay division is introducing a compostable bag for its Off The Eaten Path brand. Coca-Cola has introduced bottles made from 100% recycled plastic material while Mars Wrigley has created biodegradable wrappers for Skittles.

Classroom discussion questions:

  1. Why is Coors making this move?
  2. What is the “triple bottom line” (see page 195 in your Heizer/Render/Munson text) and how does it apply here?

OM in the News: Nestlé Tries to Tackle Big Food’s Plastic Problem

Nestle just pledged to cut its use of plastic made from fossil fuels by 1/3 in 5 years and said it would invest $2 billion to find more recycled material, a particularly big challenge for the food industry. Sellers of everything from soap to soft drinks are under pressure from consumers and regulators to use less fossil-fuel-based plastic, as well as prevent plastic trash ending up in the ocean. In response, some big consumer-goods firms, like P&G and Unilever, have rushed to promise reductions in plastic, saying they will switch to recycled material, use refillable containers or scrap packaging entirely.

But changing to recycled plastic is especially challenging for companies that need high-quality material that is safe for direct contact with food, writes The Wall Street Journal (Jan. 16, 2020). Recycling the packaging typically used for coffee, instant noodles or candy bars is difficult and expensive because it is often made from multiple types of material, like plastic melded with aluminum or paper. Sellers of fresh food also rely on plastic film—used to wrap cucumber and broccoli—and thin plastic bags for loose items, that often can’t be recycled.

Even when plastic is technically recyclable, it often isn’t collected and recycled. That is partly because, until recently, there has been little demand for recycled plastic, so even highly recyclable plastic—like drinks bottles—leak into the environment. Nestlé’s target of reducing the 1.67 million tons of plastic it uses is a challenge. Just 2% of its plastic packaging is currently made from recycled material.

To date, there is almost no market for the hard-to-recycle material often used in food packaging. Recycling efforts are being further challenged by China’s ban on scrap imports. For decades, the country took many of the world’s recyclables and turned them into new products. Its absence from the market has hit demand and raised costs for municipalities, propelling some to scrap their recycling programs entirely. This important topic is discussed in detail in Supp. 5 in your text, Sustainability in the Supply Chain.

Classroom discussion questions:

  1. Why has China reversed its position vis a vis importing plastics?
  2.  What suggestions do students have for dealing with this serious issue?