Empties Optimisation & Standartisation Workgroup

November 5, 2007

Empties Optimisation & Standartisation Working Group

Established to deal with currently inefficient use of resources in the whole supply chain created by a number of various different non-stackable types of secondary returnable packaging in use in the Baltic States

Working Group:Main Issues to Address

• Returnable Transportation Packaging (RTP) standartisation within/between product categoriescategories

• RTP pooling opportunities

• Efficient RTP criteria

• HOT: Dairy crates standartisation

Current Dairy Crates Overview: Manufacturer Perspective

Crate for polypacks protected with additional

carton walls from 2 sides

Current Dairy Crates Overview: Manufacturer Perspective

Current Dairy Crates Overview: Manufacturer Perspective

Ideal (Missing) Polypack Crate Criteria

• Same sizes in terms of length and width as currently used box

• Closed by walls from all 4 sides, holding the product inside the crate

• Bottom part closed• Interstackable - could be placed one on another • Easy to handle (storing, moving, displaying, returning, • Easy to handle (storing, moving, displaying, returning,

washing)• Fits manufacturer packaging lines (automatic lines)• Has hand-holders• Effective in cooling• Cost-efficient• Products should be visible for shoppers• Optimum colour for display in store is light grey

Non-Returnable Packaging– “Simple” carton boxes vs.

– Retail Ready Packaging

Current Dairy Packaging Overview: Retailer Perspective

Returnable packaging– Different through countries

Current Situation in DairyCurrent Dairy Packaging Overview: Retailer Perspective

LV

LT

LT

LT EE

LVLT

LV LV

• 15-20 different types of crates per country distributed

• Different sizes & standards

• Non-stackable: high risk of damage & shrink, decreased on shelf availability

Dairy Plastic CratesCurrent Dairy Packaging Issues

shelf availability

• Proper crates missing for milk in plastic and small size products, manual not efficient solutions prepared by suppliers

• Complicated handling & return

Dairy Crates in the Baltic’s Today

Current Dairy Crates Overview: Plastic Manufacturer Perspective

High costs = high sales prices due so many different types of crates in use

World Practice of Dairy Crates

Current Dairy Crates Overview: Common Needs

• Fit current industry standards of primary packaging

• Product quality protection• Hygiene • Hygiene • Ease of handling at all points of supply chain• Merchandising efficiency• Stackability• Optimised number of products inside• Reduction of transport and warehousing costs• Excellence in Point of Sales

Working Group Work-in-Progress

Only 3, maximum 4 types of cratesAll stack together in one systemMuch easier and faster handling (storing,

moving, displaying, returning, washing, returning)returning)

Bigger orders = lower costsLess waste

Dairy Crates Potential Solution

Dairy Crates Solution - Interstacking

Dairy Crates Standartisation Benefits for Manufacturers

• Cost effectiveness for manufacturers due to production processes automatisation:– savings in labour costs– savings in packaging material/carton

• Lower prices for crates – bigger orders • Lower prices for crates – bigger orders from producers/ all Baltic manufacturers would create economy of scale for crate manufacturers and drive costs down

• Common solution for all retailers – no risk due to standardised secondary packaging

• Standardisation process should start from high volume products

• Savings due to stackable packaging solutions

• Increased efficiency due to possibilities to have shorter controlling time in sales process with coding

Dairy Crates Standartisation Benefits in Logistics

sales process with coding of crates – scanner solutions

• Effective and acceptable sales units – higher efficiency in terminal picking processes

• On-shelf availability increase• Less vulnerable packaging would reduce waste

• More attractive and clear shelves layout in stores drives customer saisfaction

• Efficient transportation, handling and return• There is a difference in handling 20 vs 2 types of crates

Dairy Crates Standartisation Benefits for Consumer & Retailer

• There is a difference in handling 20 vs 2 types of crates• Efficient use of space and human resources• Speed of handling in all chain• Appropriate size of the crate

• Re-usable packaging is friendlier to environment• Biggest benefit is agreeing same crate standards and

labelling, so all parties benefit from standardised empties

Join us!

If this topic is relevant for your business, join us in room Gamma1, 2. floor @ 12.50

Efficient Distribution and Transportation