Victoria Kickham started her career as a newspaper reporter in the Boston area before moving into B2B journalism. She has covered manufacturing, distribution and supply chain issues for a variety of publications in the industrial and electronics sectors, and now writes about everything from forklift batteries to omnichannel business trends for DC Velocity.
Business leaders are looking at all aspects of their operations to find ways to become more environmentally friendly these days, from energy and water usage in their facilities, to fuel consumption in their transportation networks, to the types of paper and packaging they consume across their operations. Experts say packaging is an especially hot topic, and they point to the growing ranks of businesses seeking sustainable solutions for product transport—the boxes, trays, pallets, and containers used to move products through their supply chains.
Demand for reusable transport packaging (RTP), as it’s known, increased 66% in 2020 and was expected to rise 88% in 2021 on its way to even higher levels this year, according to the Reusable Packaging Association (RPA), which published its first annual “State of the Industry” report on RTP in late 2020 and plans to release new data later this year. Consumers’ concern for the environment and the growing use of automated equipment throughout the supply chain were driving forces cited at the time, and they continue to be key motivators, according to Norm Kukuk, president of reusable packaging manufacturer Orbis and a member of RPA, which represents both suppliers and users of reusable packaging.
“We are seeing more interest, absolutely,” says Kukuk, emphasizing the increased demand for reusables in the food, medical, and pharmaceutical industries, which have also been major adopters of automated material handling equipment. “Our plastic packaging is high tolerance [so it can be used more easily] on conveyors and in automation. Because of that, [plastic] pallets and handheld totes are seeing more demand.”
But plastic isn’t the only reusable getting attention. Metal and wood factor into it as well, according to RPA, which defines reusable transport packaging solutions as those made from durable materials designed for multiple uses in rigorous operations and logistics systems. They stand in contrast to “one-way” packaging solutions, such as corrugated boxes and containers, which are designed for a single use before being recycled or tossed in a landfill. Reusable transport packaging represented a little more than 20% of the total global packaging market in 2020, also according to RPA, a figure that is rising as business customers and consumers alike seek to become part of the circular economy.
“These packaging products are designed for lasting use in a system that ensures their effective recovery and return for continuous purpose,” according to RPA. “Reusable transport packaging products are largely designed for business-to-business applications, although the growth of e-commerce and home delivery applications is opening opportunities for the effective use of reusable packaging for transporting merchandise to households” as well.
MAKING A ROUND TRIP
The goal of reusable transport packaging is to replace one-way solutions with those that can be used multiple times. Pallets are a case in point. Both wood and plastic pallets can be reused, and increasingly, the plastic variety are being used over and over again in food and beverage operations, often because they are easy to clean and are less prone to contamination, according to Kukuk. Third-party logistics service providers (3PLs) are investing more in this type of reusable packaging as well, he says.
“Our goal is to replace limited-use with high-volume-reuse packaging,” says Kukuk, adding that Orbis’ plastic pallets, in particular, are designed for the circular economy—where they’re used as many times as possible. It’s all part of a broader effort to develop a “circular supply chain,” in which the reusables are returned to the point of origin to be refilled and sent out again. In other models, reusables are managed by a third party that pools pallets, containers, and other reusables and then readies them for reuse by other partners in the pooling system.
The frequency of reuse varies. Pallet lifespan, for instance, largely depends on how the unit is used, and manufacturers of both the plastic and wood varieties tout the virtues of whichever type they make. Kukuk says one of Orbis’ plastic pallets recently underwent testing at the Virginia Tech Center for Packaging and Unit Load Design and was found to have a lifespan of more than 400 cycles, for instance. Meanwhile, experts at the National Wooden Pallet & Container Association note that wood is the only 100% renewable and recyclable reusable product available, and that wooden pallets still dominate the market. But no matter where a company stands on the issue, both products fit the bill as reusable transport packaging and can become part of a company’s environmental sustainability story—especially as environmental, social, and governance (ESG) initiatives gain prominence in supply chains.
“Our customers have ESG [objectives] that they are committed to, [and] we are helping them understand how reusable packaging can help them meet those goals,” Kukuk explains, noting that Orbis recently hired a sustainability director to advance those efforts.
A separate industry study on the demand for returnable transport packaging underscores those sentiments. A March 2023 report from the market research firm Future Market Insights estimated that the returnable transport packaging market would hit nearly $28 billion this year and rise to nearly $46 billion over the next 10 years, primarily due to an increased focus on reuse and recycling worldwide, ongoing demands to reduce waste, and a push to reduce the utilization of single-use packages in favor of the round-trip variety. The report cites the retail, food and beverage, logistics, chemicals, and building and construction sectors as key market drivers.
A CASE IN POINT
A recent sustainable packaging project by the materials science company W.L. Gore & Associates illustrates the ways in which companies are trying to reduce their environmental impact by rethinking the way they transport goods. Gore—which is best known for its waterproof, breathable Gore-Tex fabrics—switched from using single-use cardboard containers to transport large, bulky rolls of one of its products to using reusable metal racks. Ken Staz, the company’s U.S. regional logistics operations leader, presented details of the project at the recent annual meeting of the Warehousing Education and Research Council (WERC), a warehouse industry trade group.
Staz explained that the previous shipping method required customers to either discard or recycle the cardboard boxes once the product was received—taking the disposal decision out of Gore’s hands. To gain more control over the process, Gore built a prototype of a reusable metal shipping rack that could accommodate the 240-pound rolls of product. Once the product has been removed, the racks can be broken down at the customer location and shipped back for re-use. Today, Gore is using the racks for international shipments, which are handled by the company’s third-party logistics service provider. The 3PL manages the labeling and tracking of the racks for shipping as well as sorting, inspecting, and restocking the racks at Gore’s facilities after they’ve been returned.
Staz told attendees the project will achieve a return on investment (ROI) in just over three years and has yielded annual cost savings as well.
Above all, he says, it reinforces the company’s desire to be kinder to the environment and demonstrates its willingness to take on projects aimed at meeting that goal.
“Today, sustainability is more front of mind than it has been historically,” he told attendees.
Progress in generative AI (GenAI) is poised to impact business procurement processes through advancements in three areas—agentic reasoning, multimodality, and AI agents—according to Gartner Inc.
Those functions will redefine how procurement operates and significantly impact the agendas of chief procurement officers (CPOs). And 72% of procurement leaders are already prioritizing the integration of GenAI into their strategies, thus highlighting the recognition of its potential to drive significant improvements in efficiency and effectiveness, Gartner found in a survey conducted in July, 2024, with 258 global respondents.
Gartner defined the new functions as follows:
Agentic reasoning in GenAI allows for advanced decision-making processes that mimic human-like cognition. This capability will enable procurement functions to leverage GenAI to analyze complex scenarios and make informed decisions with greater accuracy and speed.
Multimodality refers to the ability of GenAI to process and integrate multiple forms of data, such as text, images, and audio. This will make GenAI more intuitively consumable to users and enhance procurement's ability to gather and analyze diverse information sources, leading to more comprehensive insights and better-informed strategies.
AI agents are autonomous systems that can perform tasks and make decisions on behalf of human operators. In procurement, these agents will automate procurement tasks and activities, freeing up human resources to focus on strategic initiatives, complex problem-solving and edge cases.
As CPOs look to maximize the value of GenAI in procurement, the study recommended three starting points: double down on data governance, develop and incorporate privacy standards into contracts, and increase procurement thresholds.
“These advancements will usher procurement into an era where the distance between ideas, insights, and actions will shorten rapidly,” Ryan Polk, senior director analyst in Gartner’s Supply Chain practice, said in a release. "Procurement leaders who build their foundation now through a focus on data quality, privacy and risk management have the potential to reap new levels of productivity and strategic value from the technology."
Businesses are cautiously optimistic as peak holiday shipping season draws near, with many anticipating year-over-year sales increases as they continue to battle challenging supply chain conditions.
That’s according to the DHL 2024 Peak Season Shipping Survey, released today by express shipping service provider DHL Express U.S. The company surveyed small and medium-sized enterprises (SMEs) to gauge their holiday business outlook compared to last year and found that a mix of optimism and “strategic caution” prevail ahead of this year’s peak.
Nearly half (48%) of the SMEs surveyed said they expect higher holiday sales compared to 2023, while 44% said they expect sales to remain on par with last year, and just 8% said they foresee a decline. Respondents said the main challenges to hitting those goals are supply chain problems (35%), inflation and fluctuating consumer demand (34%), staffing (16%), and inventory challenges (14%).
But respondents said they have strategies in place to tackle those issues. Many said they began preparing for holiday season earlier this year—with 45% saying they started planning in Q2 or earlier, up from 39% last year. Other strategies include expanding into international markets (35%) and leveraging holiday discounts (32%).
Sixty percent of respondents said they will prioritize personalized customer service as a way to enhance customer interactions and loyalty this year. Still others said they will invest in enhanced web and mobile experiences (23%) and eco-friendly practices (13%) to draw customers this holiday season.
That challenge is one of the reasons that fewer shoppers overall are satisfied with their shopping experiences lately, Lincolnshire, Illinois-based Zebra said in its “17th Annual Global Shopper Study.”th Annual Global Shopper Study.” While 85% of shoppers last year were satisfied with both the in-store and online experiences, only 81% in 2024 are satisfied with the in-store experience and just 79% with online shopping.
In response, most retailers (78%) say they are investing in technology tools that can help both frontline workers and those watching operations from behind the scenes to minimize theft and loss, Zebra said.
Just 38% of retailers currently use AI-based prescriptive analytics for loss prevention, but a much larger 50% say they plan to use it in the next 1-3 years. That was followed by self-checkout cameras and sensors (45%), computer vision (46%), and RFID tags and readers (42%) that are planned for use within the next three years, specifically for loss prevention.
Those strategies could help improve the brick and mortar shopping experience, since 78% of shoppers say it’s annoying when products are locked up or secured within cases. Adding to that frustration is that it’s hard to find an associate while shopping in stores these days, according to 70% of consumers. In response, some just walk out; one in five shoppers has left a store without getting what they needed because a retail associate wasn’t available to help, an increase over the past two years.
The survey also identified additional frustrations faced by retailers and associates:
challenges with offering easy options for click-and-collect or returns, despite high shopper demand for them
the struggle to confirm current inventory and pricing
lingering labor shortages and increasing loss incidents, even as shoppers return to stores
“Many retailers are laying the groundwork to build a modern store experience,” Matt Guiste, Global Retail Technology Strategist, Zebra Technologies, said in a release. “They are investing in mobile and intelligent automation technologies to help inform operational decisions and enable associates to do the things that keep shoppers happy.”
The survey was administered online by Azure Knowledge Corporation and included 4,200 adult shoppers (age 18+), decision-makers, and associates, who replied to questions about the topics of shopper experience, device and technology usage, and delivery and fulfillment in store and online.
An eight-year veteran of the Georgia company, Hakala will begin his new role on January 1, when the current CEO, Tero Peltomäki, will retire after a long and noteworthy career, continuing as a member of the board of directors, Cimcorp said.
According to Hakala, automation is an inevitable course in Cimcorp’s core sectors, and the company’s end-to-end capabilities will be crucial for clients’ success. In the past, both the tire and grocery retail industries have automated individual machines and parts of their operations. In recent years, automation has spread throughout the facilities, as companies want to be able to see their entire operation with one look, utilize analytics, optimize processes, and lead with data.
“Cimcorp has always grown by starting small in the new business segments. We’ve created one solution first, and as we’ve gained more knowledge of our clients’ challenges, we have been able to expand,” Hakala said in a release. “In every phase, we aim to bring our experience to the table and even challenge the client’s initial perspective. We are interested in what our client does and how it could be done better and more efficiently.”
Although many shoppers will
return to physical stores this holiday season, online shopping remains a driving force behind peak-season shipping challenges, especially when it comes to the last mile. Consumers still want fast, free shipping if they can get it—without any delays or disruptions to their holiday deliveries.
One disruptor that gets a lot of headlines this time of year is package theft—committed by so-called “porch pirates.” These are thieves who snatch parcels from front stairs, side porches, and driveways in neighborhoods across the country. The problem adds up to billions of dollars in stolen merchandise each year—not to mention headaches for shippers, parcel delivery companies, and, of course, consumers.
Given the scope of the problem, it’s no wonder online shoppers are worried about it—especially during holiday season. In its annual report on package theft trends, released in October, the
security-focused research and product review firm Security.org found that:
17% of Americans had a package stolen in the past three months, with the typical stolen parcel worth about $50. Some 44% said they’d had a package taken at some point in their life.
Package thieves poached more than $8 billion in merchandise over the past year.
18% of adults said they’d had a package stolen that contained a gift for someone else.
Ahead of the holiday season, 88% of adults said they were worried about theft of online purchases, with more than a quarter saying they were “extremely” or “very” concerned.
But it doesn’t have to be that way. There are some low-tech steps consumers can take to help guard against porch piracy along with some high-tech logistics-focused innovations in the pipeline that can protect deliveries in the last mile. First, some common-sense advice on avoiding package theft from the Security.org research:
Install a doorbell camera, which is a relatively low-cost deterrent.
Bring packages inside promptly or arrange to have them delivered to a secure location if no one will be at home.
Consider using click-and-collect options when possible.
If the retailer allows you to specify delivery-time windows, consider doing so to avoid having packages sit outside for extended periods.
These steps may sound basic, but they are by no means a given: Fewer than half of Americans consider the timing of deliveries, less than a third have a doorbell camera, and nearly one-fifth take no precautions to prevent package theft, according to the research.
Tech vendors are stepping up to help. One example is
Arrive AI, which develops smart mailboxes for last-mile delivery and pickup. The company says its Mailbox-as-a-Service (MaaS) platform will revolutionize the last mile by building a network of parcel-storage boxes that can be accessed by people, drones, or robots. In a nutshell: Packages are placed into a weatherproof box via drone, robot, driverless carrier, or traditional delivery method—and no one other than the rightful owner can access it.
Although the platform is still in development, the company already offers solutions for business clients looking to secure high-value deliveries and sensitive shipments. The health-care industry is one example: Arrive AI offers secure drone delivery of medical supplies, prescriptions, lab samples, and the like to hospitals and other health-care facilities. The platform provides real-time tracking, chain-of-custody controls, and theft-prevention features. Arrive is conducting short-term deployments between logistics companies and health-care partners now, according to a company spokesperson.
The MaaS solution has a pretty high cool factor. And the common-sense best practices just seem like solid advice. Maybe combining both is the key to a more secure last mile—during peak shipping season and throughout the year as well.